Companies Act 1985

Accountants' reports

17 If the proceeds of the issue of the shares or debentures are to be applied directly or indirectly in the purchase of any business, or any part of the proceeds of the issue is to be so applied, there shall be set out in the prospectus a report made by accountants upon—

(a) the profits or losses of the business in respect of each of the 5 financial years immediately preceding the issue of the prospectus, and

(b) the assets and liabilities of the business at the last date to which the accounts of the business were made up.

18 (1) The following applies if—

(a) the proceeds of the issue are to be applied directly or indirectly in any manner resulting in the acquisition by the company of shares in any other body corporate, or any part of the proceeds is to be so applied, and

(b) by reason of that acquisition or anything to be done in consequence of or in connection with it, that body corporate will become a subsidiary of the company.

(2) There shall be set out in the prospectus a report made by accountants upon—

(a) the profits or losses of the other body corporate in respect of each of the 5 financial years immediately preceding the issue of the prospectus, and

(b) the assets and liabilities of the other body corporate at the last date to which its accounts were made up.

(3) The accountants' report required by this paragraph shall—

(a) indicate how the profits or losses of the other body corporate dealt with by the report would, in respect of the shares to be acquired, have concerned members of the company and what allowance would have fallen to be made, in relation to assets and liabilities so dealt with, for holders of other shares, if the company had at all material times held the shares to be acquired, and

(b) where the other body corporate has subsidiaries, deal with the profits or losses and the assets and liabilities of the body corporate and its subsidiaries in the manner provided by paragraph 16(3) above in relation to the company and its subsidiaries.