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The Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008

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Individual accountsU.K.

This section has no associated Explanatory Memorandum

9.  Sections 394 to 397 M1 apply to LLPs, modified so that they read as follows—

394.    Duty to prepare individual accounts

The members of every LLP must prepare accounts for the LLP for each of its financial years [F1unless the LLP is exempt from that requirement under section 394A]. Those accounts are referred to as the LLP's “individual accounts”.

394A.     [F2Individual accounts: exemption for dormant subsidiaries

(1) An LLP is exempt from the requirement to prepare individual accounts in a financial year if—

(a)it is itself a subsidiary undertaking,

(b)it has been dormant throughout the whole of that year, and

(c)its parent undertaking is established under the law of [F3any part of the United Kingdom].

(2) Exemption is conditional upon compliance with all of the following conditions—

(a)all members of the LLP must agree to the exemption in respect of the financial year in question,

(b)the parent undertaking must give a guarantee under section 394C in respect of that year,

(c)the LLP must be included in the consolidated accounts drawn up for that year or to an earlier date in that year by the parent undertaking in accordance with—

[F4(i)if the undertaking is a company, the requirements of this Part of this Act, or, if the undertaking is not a company, the legal requirements which apply to the drawing up of consolidated accounts for that undertaking, or]

(ii)[F5UK-adopted international accounting standards],

(d)the parent undertaking must disclose in the notes to the consolidated accounts that the LLP is exempt from the requirement to prepare individual accounts by virtue of this section,

(e)the designated members of the LLP must deliver to the registrar, within the period for filing the LLP’s account and auditor’s report for that year—

(i)a written notice of the agreement referred to in subsection (2)(a),

(ii)the statement referred to in section 394C(1),

(iii)a copy of the consolidated accounts referred to in subsection (2)(c),

(iv)a copy of the auditor’s report on those accounts, and

(v)a copy of the consolidated annual report drawn up by the parent undertaking.

394B.     LLPs excluded from the dormant subsidiaries exemption

An LLP is not entitled to the exemption conferred by section 394A (dormant subsidiaries) if it was at any time within the financial year in question—

[F6(za)a traded LLP,]

(a)an LLP that—

(i)is an authorised insurance company, a banking LLP, an e-money issuer, a MiFID investment firm or a UCITS management company, or

(ii)carries on insurance market activity, or

(b)an employers’ association as defined in section 122 of the Trade Union and Labour Relations (Consolidation) Act 1992 (c.52) or Article 4 of the Industrial Relations (Northern Ireland) Order 1992 (S.I. 1992/807) (NI 5).

394C.    Dormant subsidiaries exemption: parent undertaking declaration of guarantee

(1) A guarantee is given by a parent undertaking under this section when the designated members of the subsidiary LLP deliver to the registrar a statement by the parent undertaking that it guarantees the subsidiary LLP under this section.

(2) The statement under subsection (1) must be authenticated by the parent undertaking and must specify—

(a)the name of the parent undertaking,

[F7(b)the registered number of the parent undertaking (if any),]

F8(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(d)the name and registered number of the subsidiary LLP in respect of which the guarantee is being given,

(e)the date of the statement, and

(f)the financial year to which the guarantee relates.

(3) A guarantee given under this section has the effect that—

(a)the parent undertaking guarantees all outstanding liabilities to which the subsidiary LLP is subject at the end of the financial year to which the guarantee relates, until they are satisfied in full, and

(b)the guarantee is enforceable against the parent undertaking by any person to whom the subsidiary LLP is liable in respect of those liabilities.]

395.    Individual accounts: applicable accounting framework

(1) An LLP's individual accounts may be prepared—

(a)in accordance with section 396 (“non-IAS individual accounts”), or

(b)in accordance with [F9UK-adopted international accounting standards] (“IAS individual accounts”).

This is subject to the following provisions of this section and to section 407 (consistency of financial reporting within group).

(2) After the first financial year in which the members of an LLP prepare IAS individual accounts (“the first IAS year”), all subsequent individual accounts of the LLP must be prepared in accordance with [F9UK-adopted international accounting standards] unless there is a relevant change of circumstance. [F10This is subject to subsection (3A).]

(3) There is a relevant change of circumstance if, at any time during or after the first IAS year—

(a)the LLP becomes a subsidiary undertaking of another undertaking that does not prepare IAS individual accounts,

(b)the LLP ceases to be a subsidiary undertaking,

(c)the LLP ceases to be an LLP with securities admitted to trading on a [F11UK regulated market], or

(d)a parent undertaking of the LLP ceases to be an undertaking with securities admitted to trading on a [F12UK regulated market].

[F13(3A) After a financial year in which the members of an LLP prepare IAS individual accounts, the members may change to preparing non-IAS individual accounts for a reason other than a relevant change of circumstance provided they have not changed to non-IAS individual accounts in the period of five years preceding the first day of that financial year.

(3B) In calculating the five year period for the purpose of subsection (3A), no account should be taken of a change due to a relevant change of circumstance.]

(4) If, having changed to preparing non-IAS individual accountsF14... , the members again prepare IAS individual accounts for the LLP, subsections (2) and (3) apply again as if the first financial year for which such accounts are again prepared were the first IAS year.

396.    Non-IAS individual accounts

[F15(A1) Non-IAS individual accounts must state—

(a)the part of the United Kingdom in which the LLP is registered,

(b)the LLP’s registered number,

(c)the address of the LLP’s registered office, and

(d)where appropriate, the fact that the LLP is being wound up.]

(1) Non-IAS individual accounts must comprise—

(a)a balance sheet as at the last day of the financial year, and

(b)a profit and loss account.

(2) The accounts must—

(a)in the case of the balance sheet, give a true and fair view of the state of affairs of the LLP as at the end of the financial year, and

(b)in the case of the profit and loss account, give a true and fair view of the profit or loss of the LLP for the financial year.

[F16(2A) In the case of the individual accounts of an LLP which qualifies as a micro-entity in relation to the financial year (see sections 384A and 384B), the micro-entity minimum accounting items included in the LLP’s accounts for the year are presumed to give the true and fair view required by subsection (2).]

(3) The accounts must comply with the provisions of—

(a)regulation 3 of the Small Limited Liability Partnerships (Accounts) Regulations 2008 (non-IAS individual accounts of LLP subject to the small LLPs regime) (S.I. 2008/1912), or

(b)regulations 3 and 4 of the Large and Medium-sized Limited Liability Partnerships (Accounts) Regulations 2008 (non-IAS individual accounts of large and medium-sized LLPs) (S.I. 2008/1913),

as to the form and content of the balance sheet and profit and loss account, and additional information to be provided by way of notes to the accounts..

(4) If compliance with the regulations specified in subsection (3), and any other provision made by or under this Act as to the matters to be included in an LLP's individual accounts or in notes to those accounts, would not be sufficient to give a true and fair view, the necessary additional information must be given in the accounts or in a note to them.

(5) If in special circumstances compliance with any of those provisions is inconsistent with the requirement to give a true and fair view, the members must depart from that provision to the extent necessary to give a true and fair view. Particulars of any such departure, the reasons for it and its effect must be given in a note to the accounts.

[F17(6) Subsections (4) and (5) do not apply in relation to the micro-entity minimum accounting items included in the individual accounts of an LLP for a financial year in relation to which the LLP qualifies as a micro-entity.]

397.    [F18IAS individual accounts

(1) IAS individual accounts must state—

(a)the part of the United Kingdom in which the LLP is registered,

(b)the LLP’s registered number,

(c)the address of the LLP’s registered office, and

(d)where appropriate, the fact that the LLP is being wound up.

(2) The notes to the accounts must state that the accounts have been prepared in accordance with [F19UK-adopted international accounting standards].]

Textual Amendments

F3Words in reg. 9 substituted (31.12.2020 with effect in relation to financial years beginning on or after IP completion day) by The Accounts and Reports (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/145), regs. 1(2)(b), 2, Sch. 3 para. 15(a)(i) (with reg. 7(2)) (as amended by S.I. 2020/523, regs. 1(2), 10, 11); 2020 c. 1, Sch. 5 para. 1(1)

F4Words in reg. 9 substituted (31.12.2020 with effect in relation to financial years beginning on or after IP completion day) by The Accounts and Reports (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/145), regs. 1(2)(b), 2, Sch. 3 para. 15(a)(ii) (with reg. 7(2)) (as amended by S.I. 2020/523, regs. 1(2), 10, 11); 2020 c. 1, Sch. 5 para. 1(1)

F5Words in reg. 9 substituted (31.12.2020 with effect in relation to accounts for financial years beginning on or after IP completion day) by The International Accounting Standards and European Public Limited-Liability Company (Amendment etc.) (EU Exit) Regulations 2019 (S.I. 2019/685), reg. 1(2), Sch. 1 para. 58(3)(a) (with reg. 1(3)-(8), Sch. 1 para. 65); 2020 c. 1, Sch. 5 para. 1(1)

F6Words in reg. 9 inserted (with effect in accordance with reg. 2(2)-(5) of the amending S.I.) by The Limited Liability Partnerships, Partnerships and Groups (Accounts and Audit) Regulations 2016 (S.I. 2016/575), regs. 2(1), 8(3)

F7Words in reg. 9 substituted (31.12.2020 with effect in relation to financial years beginning on or after IP completion day) by The Accounts and Reports (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/145), regs. 1(2)(b), 2, Sch. 3 para. 15(b)(i) (with reg. 7(2)) (as amended by S.I. 2020/523, regs. 1(2), 10, 11); 2020 c. 1, Sch. 5 para. 1(1)

F8Words in reg. 9 omitted (31.12.2020 with effect in relation to financial years beginning on or after IP completion day) by virtue of The Accounts and Reports (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/145), regs. 1(2)(b), 2, Sch. 3 para. 15(b)(ii) (with reg. 7(2)) (as amended by S.I. 2020/523, regs. 1(2), 10, 11); 2020 c. 1, Sch. 5 para. 1(1)

F9Words in reg. 9 substituted (31.12.2020 with effect in relation to accounts for financial years beginning on or after IP completion day) by The International Accounting Standards and European Public Limited-Liability Company (Amendment etc.) (EU Exit) Regulations 2019 (S.I. 2019/685), reg. 1(2), Sch. 1 para. 58(3)(b) (with reg. 1(3)-(8), Sch. 1 para. 65); 2020 c. 1, Sch. 5 para. 1(1)

F11Words in reg. 9 substituted (31.12.2020 with effect in relation to financial years beginning on or after IP completion day) by The Accounts and Reports (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/145), regs. 1(2)(b), 2, Sch. 3 para. 15(c)(i) (with reg. 7(2)) (as amended by S.I. 2020/523, regs. 1(2), 10, 11); 2020 c. 1, Sch. 5 para. 1(1)

F12Words in reg. 9 substituted (31.12.2020 with effect in relation to financial years beginning on or after IP completion day) by The Accounts and Reports (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/145), regs. 1(2)(b), 2, Sch. 3 para. 15(c)(ii) (with reg. 7(2)) (as amended by S.I. 2020/523, regs. 1(2), 10, 11); 2020 c. 1, Sch. 5 para. 1(1)

F15Words in reg. 9 inserted (with effect in accordance with reg. 2(2)-(5) of the amending S.I.) by The Limited Liability Partnerships, Partnerships and Groups (Accounts and Audit) Regulations 2016 (S.I. 2016/575), regs. 2(1), 8(4)(a)

F16Words in reg. 9 inserted (with effect in accordance with reg. 2(2)-(5) of the amending S.I.) by The Limited Liability Partnerships, Partnerships and Groups (Accounts and Audit) Regulations 2016 (S.I. 2016/575), regs. 2(1), 8(4)(b)

F17Words in reg. 9 inserted (with effect in accordance with reg. 2(2)-(5) of the amending S.I.) by The Limited Liability Partnerships, Partnerships and Groups (Accounts and Audit) Regulations 2016 (S.I. 2016/575), regs. 2(1), 8(4)(c)

F18Words in reg. 9 substituted (with effect in accordance with reg. 2(2)-(5) of the amending S.I.) by The Limited Liability Partnerships, Partnerships and Groups (Accounts and Audit) Regulations 2016 (S.I. 2016/575), regs. 2(1), 8(5)

F19Words in reg. 9 substituted (31.12.2020 with effect in relation to accounts for financial years beginning on or after IP completion day) by The International Accounting Standards and European Public Limited-Liability Company (Amendment etc.) (EU Exit) Regulations 2019 (S.I. 2019/685), reg. 1(2), Sch. 1 para. 58(3)(c) (with reg. 1(3)-(8), Sch. 1 para. 65); 2020 c. 1, Sch. 5 para. 1(1)

Marginal Citations

M1Section 395 was amended by regulation 9 of S.I. 2008/393.

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