Explanatory Note
(This note is not part of the Regulations.)
1. These Regulations amend provisions in Part VIII of the Companies (Northern Ireland) Order 1986 (“the 1986 Order”) concerning the accounts of small and medium-sized companies (as defined in Article 255 of the 1986 Order). They also make certain minor and consequential amendments to other accounting provisions of Part VIII.
2. Regulation 1 makes provision concerning the application of the regulations, and contains transitional provisions.
3. Regulation 2 substitutes a new Article 254 (special provisions for small companies) and Schedule 8 (form and content of accounts prepared by small companies), and inserts a new Schedule 8A (form and content of abbreviated accounts of small companies delivered to the registrar of companies). The effect of these amendments is to set out in full the provisions governing the form and content of the accounts and reports prepared by small companies and delivered to the registrar, rather than, as previously, operating as a derogation from Schedule 4 to the 1986 Order. The new Article 254(8) also simplifies the statements required on the balance sheets and in the directors' reports of small companies. Otherwise there are no changes of substance.
4. Regulation 3 inserts a new Article 254A (special provisions for medium-sized companies) which brings together the special provisions applying to the accounts of medium-sized companies and simplifies the statement required on the balance sheet of such companies. Otherwise there are no changes of substance.
5. Regulations 4 and 6 restate (without changes of substance) the provisions of the 1986 Order concerning the circumstances in which the special provisions for small and medium-sized companies do not apply (new Article 255A) and the preparation of group accounts by small companies (new Article 256A).
6. Regulation 5 inserts a new Article 255B, which restates the provisions previously contained in paragraph 24 of Schedule 8 to the 1986 Order concerning the special auditors' report required when a small or medium-sized company delivers abbreviated accounts to the registrar of companies. There are two changes of substance. Firstly, the auditors are no longer required to make a report to the directors as was formerly provided by paragraph 24(1) of Schedule 8. Secondly, the special report of the auditors delivered to the registrar need no longer in all cases be accompanied by, or set out in full, the auditors' report under Article 243. It need only do so where the Article 243 report was qualified, or contained a statement under Article 245(2) (accounts, records or returns inadequate or accounts not agreeing with records and returns) or Article 245(3) (failure to obtain necessary information and explanations).
7. Regulation 7 contains amendments to the 1986 Order consequential on the amendments effected by regulations 2 to 6. It also makes other minor amendments to the provisions in Part VIII of the 1986 Order. In particular regulation 7(4) makes amendments to Article 258 consequential both on the amendments effected by regulations 2 to 6 and on the repeal of Article 258(2)(a) of the 1986 Order effected by regulation 10 of the Companies (1986 Order) (Miscellaneous Accounting Amendments) Regulations (Northern Ireland) 1997 (S.R. 1997 No. 314). Regulation 7(9) further amends paragraph 48(1)(b) of Schedule 4 to the 1986 Order to make clear that disclosure should only be of amounts due after more than 5 years. Regulation 7(10)(a), (11) and (12) makes amendments consequential on the repeal of paragraph 59 of Schedule 4 to the 1986 Order effected by regulation 13(1) of, and paragraph 15 of Schedule 1 to, S.R. 1997 No. 314.