Companies Act 1985

271 Requirements for last annual accounts. E+W+S

(1) If the company’s last annual accounts constitute the only accounts relevant under section 270, the statutory requirements in respect of them are as follows.

(2) The accounts must have been properly prepared in accordance with this Act, or have been so prepared subject only to matters which are not material for determining, by reference to items mentioned in section 270(2), whether the distribution would contravene the relevant section; and, without prejudice to the foregoing—

(a) so much of the accounts as consists of a balance sheet must give a true and fair view of the state of the company’s affairs as at the balance sheet date, and

(b) so much of the accounts as consists of a profit and loss account must give a true and fair view of the company’s profit or loss for the period in respect of which the accounts were prepared.

(3) The auditors must have made their report on the accounts under [F1 section 235]; and the following subsection applies if the report is a qualified report, that is to say, it is not a report without qualification to the effect that in the auditors’ opinion the accounts have been properly prepared in accordance with this Act.

(4) The auditors must in that case also have stated in writing (either at the time of their report or subsequently) whether, in their opinion, the matter in respect of which their report is qualified is material for determining, by reference to items mentioned in section 270(2), whether the distribution would contravene the relevant section; F2 . . . .

[F3 (4A) A copy of the auditors' statement under subsection (4) must—

(a) in the case of a private company, have been circulated to members along with the copies of the accounts sent to them under section 238(1);

(b) in the case of a public company, have been laid before the company in general meeting.]

(5) A statement under subsection (4) suffices for purposes of a particular distribution not only if it relates to a distribution which has been proposed but also if it relates to distributions of any description which includes that particular distribution, notwithstanding that at the time of the statement it has not been proposed.

Textual Amendments

F1 Words substituted (subject to the transitional and saving provisions mentioned in S.I. 1990/355, arts. 6–9) by Companies Act 1989 (c. 40, SIF 27), ss. 23, 213(2), Sch. 10 para. 4

F2 Words in s. 271(4) omitted (1.10.2007 with effect as mentioned in Sch. 4 para. 3(8) of the amending S.I.) by virtue of The Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), art. 10(1), Sch. 4 para. 3(7) (with art. 12)

F3 S. 271(4A) inserted (1.10.2007 with effect as mentioned in Sch. 4 para. 3(8) of the amending S.I.) by The Companies Act 2006 (Commencement No. 3, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/2194), art. 10(1), Sch. 4 para. 3(7) (with art. 12)

Modifications etc. (not altering text)

C1 Ss. 270-276 modified (5.10.2004) by Energy Act 2004 (c. 20), ss. 39, 198(2), Sch. 6 para. 7 (with s. 38(2), Sch. 6 para. 8); S.I. 2004/2575, art. 2(1), Sch. 1

C2 S. 271 modified by Airports Act 1986 (c. 31, SIF 9), s. 83(4), Sch. 5 para. 9(1)

C3 S. 271 modified by Electricity Act 1989 (c. 29, SIF 44:1), s. 112(3), Sch. 17 paras. 35(1), 39(1)

C4 Ss. 270 - 276 applied (with modifications) (27. 12. 1991) by S.I. 1991/2908, art. 2, Sch. para. 7(1)

Ss. 270-276 applied (with modifications) (24.11.1995) by S.I. 1995/3023, art. 7(1)(2)

C5 Ss. 270 - 276 modified (6. 1. 1992) by British Technology Group Act 1991 (c. 66, SIF 64), s. 17(3), Sch. 3 para. 7(1); S.I. 1991/2721, art.2

Ss. 270-276 modified (8.11.1995) by 1995 c. 37, s. 6, Sch. 2 para. 7(1)

Ss. 270-276 modified (24.7.1996) by 1996 c. 55, ss. 134, 149(1)(f), Sch. 6 para. 4(1)

C6 Ss. 270-276 applied (prosp.) by Horserace Betting and Olympic Lottery Act 2004 (c. 25), ss. 6(6), 40