- Latest available (Revised)
- Point in Time (20/03/2003)
- Original (As enacted)
Version Superseded: 04/03/2004
Point in time view as at 20/03/2003.
Building Societies Act 1986, Part VIII is up to date with all changes known to be in force on or before 31 October 2024. There are changes that may be brought into force at a future date. Changes that have been made appear in the content and are referenced with annotations.
Changes and effects yet to be applied by the editorial team are only applicable when viewing the latest version or prospective version of legislation. They are therefore not accessible when viewing legislation as at a specific point in time. To view the ‘Changes to Legislation’ information for this provision return to the latest version view using the options provided in the ‘What Version’ box above.
Modifications etc. (not altering text)
C1Pt. VIII (ss. 71–82) excluded by S.I. 1986/2168, art. 12(1)(a)
C2Pt. VIII (ss. 71–82) modified (temp.until 1.1.1993) by S.I. 1990/1392, art. 6(3)
Textual Amendments
F1Words in s. 71 cross-heading omitted (17.8.2001 for certain purposes) and repealed (1.12.2001) by S.I. 2001/2617, arts. 2(a)(b), 8, 13(1)(2), Sch. 3 para. 163(a), Sch. 4 (with art. 13(3), Sch. 5); S.I. 2001/3538, art. 2(1)
(1)Every building society shall—
(a)cause accounting records to be kept, F3. . .
F3(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
in accordance with this section.
(2)The accounting records of a society must be such as to—
(a)explain its transactions;
(b)disclose, with reasonable accuracy and promptness, the state of the business of the society at any time;
(c)enable the directors properly to discharge the duties imposed on them by or under this Act and their functions of direction of the affairs of the society; and
(d)enable the society properly to discharge the duties imposed on it by or under this Act;
and must be kept in an orderly manner.
(3)The accounting records shall in particular contain—
(a)entries from day to day of all sums received and paid by the society and the matters in respect of which they are received or paid;
(b)entries from day to day of every transaction entered into by the society which will or there is reasonable ground for expecting may give rise to liabilities or assets of the society other than insignificant assets or liabilities in respect of the management of the society; and
(c)a record of the assets and liabilities of the society and in particular of assets and liabilities of any class specifically regulated by or under [F4section 6 or 7].
F5(4). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F5(5). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F5(6). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F5(7). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(8)The accounting records shall be kept at the society’s principal office or at such other place or places as the directors think fit, and shall at all times be open to inspection by the directors.
(9)Accounting records shall be preserved for six years from the date on which they were made.
(10)Where a building society has [F6connected undertakings], the society shall also secure that such accounting records are kept F7. . . by the society and the [F6connected undertakings] as will enable the society to comply with the requirements of this section in relation to the business of the society and those [F6connected undertakings].
[F8(10A)The Commission may, for the purpose of implementing the Council Directive on the supervision of credit institutions on a consolidated basis (No. 92/30/EEC) F9, direct that subsection (10) above shall have effect in relation to any building society specified in the direction as if any associated body of the society so specified were linked to it by resolution.]
F10(11). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textual Amendments
F2Words in s. 71 side-note repealed (1.12.2001) by S.I. 2001/2617, arts. 2(b), 13(2), Sch. 4 (with art. 13(3), Sch. 5); S.I. 2001/3538, art. 2(1)
F3S. 71(1)(b) and the preceding word “and" repealed (1.12.2001) by S.I. 2001/2617, arts. 2(b), 13(2), Sch. 4 (with art. 13(3), Sch. 5); S.I. 2001/3538, art. 2(1)
F4Words in s. 71(3)(c) substituted (1.12.1997 in specified cases and for specified purposes and otherwise in accordance with art. 2(2)(3)(5) of S.I. 1997/2668) by 1997 c. 32, ss. 43, 47(3), Sch. 7 para. 29(1); S.I. 1997/2668, art. 2, Sch. Pt. II(w)(z)(xvi)
F5S. 71(4)-(7) repealed (1.12.2001) by S.I. 2001/2617, arts. 2(b), 13(2), Sch. 4 (with art. 13(3), Sch. 5); S.I. 2001/3538, art. 2(1)
F6Words in s. 71(10) substituted (1.12.1997 in specified cases and for specified purposes and otherwise in accordance with art. 2(2)(3)(5) of S.I. 1997/2668) by 1997 c. 32, ss. 43, 47(3), Sch. 7 para. 29(3)(a)-(c); S.I. 1997/2668, art. 2, Sch. Pt. II(w)(z)(xvi)
F7Words in s. 71(10) repealed (1.12.2001) by S.I. 2001/2617, arts. 2(b), 13(2), Sch. 4 (with art. 13(3), Sch. 5); S.I. 2001/3538, art. 2(1)
F8S. 71(10A) repealed (1.12.1997 in specified cases and for specified purposes and otherwise in accordance with art. 2(2)(3)(5) of S.I. 1997/2668) by 1997 c. 32, ss. 43, 46(2), 47(3), Sch. 7 para. 29(4), Sch. 9; S.I. 1997/2668, art. 2, Sch. Pt. II(w)(z)(xvi)(cc)(x)
F9OJ No. L110, 28.4.92, p.52.
F10S. 71(11) repealed (1.12.2001) by S.I. 2001/2617, arts. 2(b), 13(2), Sch. 4 (with art.13(3), Sch. 5); S.I. 2001/3538, art. 2(a)
Modifications etc. (not altering text)
C3S. 71 modified (temp.) by S.I. 1986/2168, art. 12(2)(d)
C4S. 71(1)–(10) excluded (temp.) by S.I. 1986/2168, art. 12(2)(a)
(1)Subject to subsection (4) below, the directors of every building society shall prepare with respect to each financial year of the society—
(a)an income and expenditure account showing the income and expenditure for that year, [F11and]
(b)a balance sheet showing the state of its affairs as at the end of that year, F12. . .
(c)a statement of the source and application of the funds during that year.
(2)F13 . . ., if, at the end of its financial year, a building society has [F14subsidiary undertakings] , the directors shall also prepare, with respect to that year, group accounts dealing respectively with the income and expenditure, [F15and the state of the affairs], of the society and the [F14subsidiary undertakings].
(3)The directors of a building society which has [F14subsidiary undertakings] shall secure that, except where in their opinion there are good reasons against it, the financial year of each of its [F14subsidiary undertakings] coincides with the society’s own financial year.
F16(4). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F17(5). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F17(6). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(7)The [F18Treasury may by regulations]—
(a)add to the classes of documents to be comprised in a society’s accounts to be prepared for each financial year under subsection (1) or (2) above;
(b)make provision as to the matters to be included in any document so added;
(c)modify the requirements of this Part as to the matters to be stated in any document comprised in the society’s accounts; and
(d)reduce the classes of documents to be comprised in a society’s accounts.
(8)Regulations under subsection (7) above may make different provision for different descriptions of society, and may include incidental and supplementary provisions.
(9)The power to make regulations under subsection (7) above is exercisable by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.
(10)The accounts prepared with respect to a society’s financial year under this section (whether as individual accounts or group accounts), with the notes to them, are referred to in this Part as “the annual accounts”.
Textual Amendments
F11Word in s. 72(1)(a) inserted (23.3.1999) by S.I. 1999/248, reg. 3, Sch. para. 2(1)
F12Word in s. 72(1)(c) omitted (23.3.1999) by virtue of S.I. 1999/248, reg. 3, Sch. para. 2(1)
F13Words in s. 72(2) omitted by virtue of S.I. 1991/1729, art. 4(1).
F14Words in ss. 71-82 (Pt. VIII) substituted by S.I. 1991/1729, art. 3.
F15Words in s. 72(2) substituted (23.3.1999) by S.I. 1999/248, reg. 3, Sch. para. 2(2)
F16S. 72(4) repealed (23.3.1999) by S.I. 1999/248, reg. 3, Sch. para. 2(3)
F17S. 72(5)(6) omitted by virtue of S.I. 1991/1729, art. 4(2).
F18Words in s. 72(7) substituted (17.8.2001 for certain purposes and otherwise 1.12.2001) by S.I. 2001/2617, arts. 2(a)(b), 8, 13(1), Sch. 3 para. 164 (with art. 13(3), Sch. 5); S.I. 2001/3538, art. 2(1)
Modifications etc. (not altering text)
C5S. 72(7)(8): Functions of the Building Societies Commission transferred (1.12.2001) to the Treasury by S.I. 2001/2617, arts. 2(b), 4(1), Sch. 1 Pt. III (with art. 5); S.I. 2001/3538, art. 2(1)
(1)The annual accounts of a building society shall conform to the requirements of this section and regulations made under it.
(2)Every income and expenditure account shall give a true and fair view of the income and expenditure of the society for the financial year.
(3)Every balance sheet shall give a true and fair view of the state of the affairs of the society as at the end of the financial year.
F19(4). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(5)Subsections [F20(2) and (3)] above, in their application to the group accounts of a society, are to be read as referring to the society and (so far as it concerns the members of the society) the [F21subsidiary undertakings] dealt with in the group accounts.
(6)The annual accounts shall also contain, whether in the form of notes or otherwise, such supplementary information as is prescribed.
(7)The [F22Treasury shall by regulations] make provision with respect to the contents and the form of the annual accounts.
(8)Without prejudice to the generality of subsections (6) and (7) above, the regulations may—
(a)prescribe accounting principles and rules;
(b)require corresponding information for a preceding financial year;
(c)require the accounts of societies to deal also with [F23their associated undertakings];
(d)make different provision for different descriptions of society;
(e)require the accounts to give particulars of the emoluments, pensions, compensation for loss of office and financial interests of directors, other officers and employees of prescribed descriptions of the society;
and may permit group accounts to be prepared in other than consolidated form.
(9)Where compliance with regulations under this section would not secure compliance with the requirements of subsection [F24(2) or (3)] above the directors shall take such steps with regard to the contents or form of the accounts, in addition to or, if additions do not suffice, in derogation of the provisions of the regulations, as they think necessary to secure compliance with those subsections and record, in the notes to the accounts, what they have done, the reasons for it and its effects.
(10)The power to make regulations under this section is exercisable by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.
(11)It is the duty of every director, other officer and employee of a building society as respects whom prescribed particulars are by virtue of subsection (8)(e) above required to be given in the accounts to give notice of such matters as may be necessary to enable the society to give those particulars in the accounts.
(12)In this section “prescribed” means prescribed in regulations under it.
Textual Amendments
F19S. 73(4) repealed (23.3.1999) by S.I. 1999/248, reg. 3, Sch. para. 3(1)
F20Words in s. 73(5) substituted (23.3.1999) by S.I. 1999/248, reg. 3, Sch. para. 3(2)
F21Words in ss. 71-82 (Pt. VIII) substituted by S.I. 1991/1729, art. 3
F22Words in s. 73(7) substituted (17.8.2001 for certain purposes and otherwise 1.12.2001) by S.I. 2001/2617, arts. 2(a)(b), 8, 13(1), Sch. 3 para. 165 (with art. 13(3), Sch. 5); S.I. 2001/3538, art. 2(1)
F23Words in s. 73(8)(c) substituted (1.12.1997 in specified cases and for specified purposes and otherwise in accordance with art. 2(2)(3)(5) of S.I. 1997/2668) by 1997 c. 32, ss. 43, 47(3), Sch. 7 para. 30; S.I. 1997/2668, art. 2, Sch. Pt. II(w)(z)(xvii)
F24Words in s. 73(9) substituted (23.3.1999) by S.I. 1999/248, reg. 3, Sch. para. 3(3)
Modifications etc. (not altering text)
C6S. 73(6)-(8): Functions of the Building Societies Commission transferred (1.12.2001) to the Treasury by S.I. 2001/2617, arts. 2(b), 4(1), Sch. 1 Pt. III (with art. 5); S.I. 2001/3538, art. 2(1)
(1)The directors of every building society shall, by reference to the annual accounts and other records and information at their disposal, prepare with respect to each financial year of the society a statement (referred to in this Act as “the annual business statement”) relating to prescribed aspects of the business of the society during the year.
(2)Where the society has [F25connected undertakings] the annual business statement shall deal also with prescribed aspects of the business of the [F25connected undertakings] during the year to which it relates.
(3)The annual business statement shall contain such information relating to such aspects of the business of the society and shall be in such form as the [F26Treasury prescribe by regulations]; and in this section “prescribed” means prescribed by regulations under this subsection.
(4)Without prejudice to the generality of subsections (1) to (3) above the regulations may require the annual business statements of building societies to include prescribed information about directors and past directors and persons connected with them and other officers and past officers and persons connected with them and their financial interests.
(5)The information comprising the annual business statement shall give a true representation of the matters in respect of which it is given.
(6)To such extent as may be prescribed matters contained in the society’s annual business statement shall not be the subject of report by the auditors under section 78.
(7)The power to make regulations under subsection (3) above is exercisable by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.
(8)It is the duty of every director or other officer of a building society to give notice to the society of such matters relating to himself or his financial interests as may be necessary for the purposes of compliance with the preceding provisions of this section.
(9)Any person who fails to comply with subsection (8) above shall be liable on summary conviction to a fine not exceeding level 5 on the standard scale.
(10)Any director who fails to comply with subsection (1) above shall be liable on conviction on indictment or on summary conviction to a fine not exceeding, on summary conviction, the statutory maximum.
Textual Amendments
F25Words in s. 74(2) substituted (1.12.1997 in specified cases and for specified purposes and otherwise in accordance with art. 2(2)(3)(5) of S.I. 1997/2668) by 1997 c. 32, ss. 43, 47(3), Sch. 7 para. 31; S.I. 1997/2668, art. 2, Sch. Pt. II(w)(z)(xviii)
F26Words in s. 74(3) substituted (17.8.2001 for certain purposes and otherwise 1.12.2001) by S.I. 2001/2617, arts. 2(a)(b), 8, 13(1), Sch. 3 para. 166 (with art. 13(3), Sch. 5); S.I. 2001/3538, art. 2(1)
Modifications etc. (not altering text)
C7S. 74(3)(4): Functions of the Building Societies Commission transferred (1.12.2001) to the Treasury by S.I. 2001/2617, arts. 2(b), 4(1), Sch. 1 Pt. III (with art. 5); S.I. 2001/3538, art. 2(1)
(1)The directors of a building society shall prepare for submission to the annual general meeting a report on the business of the society containing—
(a)a fair review of the development of its business during the financial year and of its position at the end of it, and
(b)such information relating to such aspects of the business of the society or the society and any [F27connected undertakings] as may be prescribed by regulations made by the F28. . . Treasury, and
[F29(c)a statement as to the matters mentioned in subsection (1A) below.]
[F30(1A)The said matters are—
(a)whether the society has acquired or established, or allowed a subsidiary undertaking to acquire or establish, a business to which subsection (3) and subsection (4) or, as the case may be, subsection (5) of section 92A applied;
(b)if the society has acquired or established, or allowed such an undertaking to acquire or establish, such a business, what the business is and whether the society complied with the requirements of subsection (1) of that section; and
(c)if the society did not comply with those requirements, why the society nevertheless proceeded, or allowed the undertaking to proceed, with the acquisition or establishment.]
(2)Where the society has [F31connected undertakings] the report shall, in addition to containing the information prescribed in relation to them under subsection (1)(b) above, review the development of the business of the society and its [F32connected undertakings] during the year and their position at the end of it.
(3)The power to make regulations under subsection (1) above is exercisable by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.
(4)If a directors’ report does not contain [F33the review, information and statement required by subsection (1) above and, where applicable, the review required by subsection (2) above], each director shall be liable on conviction on indictment or on summary conviction to a fine not exceeding, on summary conviction, the statutory maximum.
Textual Amendments
F27Words in s. 75(1)(b) substituted (1.12.1997 in specified cases and for specified purposes and otherwise in accordance with art. 2(2)(3)(5) of S.I. 1997/2668) by 1997 c. 32, ss. 43, 47(3), Sch. 7 para. 32(1)(a); S.I. 1997/2668, art. 2, Sch. Pt. II(w)(z)(xix)
F28Words in s. 75(1)(b) repealed (1.12.2001) by S.I. 2001/2617, arts. 2(b), 13(2), Sch. 4 (with art. 13(3), Sch. 5); S.I. 2001/3538, art. 2(1)
F29S. 75(1)(c) substituted (1.12.1997 in specified cases and for specified purposes and otherwise in accordance with art. 2(2)(3)(5) of S.I. 1997/2668) by 1997 c. 32, ss. 43, 47(3), Sch. 7 para. 32(1)(b); S.I. 1997/2668, art. 2, Sch. Pt. II(w)(z)(xix)
F30S. 75(1A) inserted (1.12.1997 in specified cases and for specified purposes and otherwise in accordance with art. 2(2)(3)(5) of S.I. 1997/2668) by 1997 c. 32, ss. 43, 47(3), Sch. 7 para. 32(2); S.I. 1997/2668, art. 2, Sch. Pt. II(w)(z)(xix)
F31Words in s. 75(2) substituted (1.12.1997 in specified cases and for specified purposes and otherwise in accordance with art. 2(2)(3)(5) of S.I. 1997/2668) by 1997 c. 32, ss. 43, 47(3), Sch. 7 para. 32(3)(a); S.I. 1997/2668, art. 2, Sch. Pt. II(w)(z)(xix)
F32Words in s. 75(2) substituted (1.12.1997 in specified cases and for specified purposes and otherwise in accordance with art. 2(2)(3)(5) of S.I. 1997/2668) by 1997 c. 32, ss. 43, 47(3), Sch. 7 para. 32(3)(b); S.I. 1997/2668, art. 2, Sch. Pt. II(w)(z)(xix)
F33Words in s. 75(4) substituted (1.12.1997 in specified cases and for specified purposes and otherwise in accordance with art. 2(2)(3)(5) of S.I. 1997/2668) by 1997 c. 32, ss. 43, 47(3), Sch. 7 para. 32(4); S.I. 1997/2668, art. 2, Sch. Pt. II(w)(z)(xix)
Modifications etc. (not altering text)
C8S. 75(1)(b): Functions of the Building Societies Commission transferred (1.12.2001) to the Treasury by S.I. 2001/2617, arts. 2(b), 4(1), Sch. 1 Pt. III (with art. 5); S.I. 2001/3538, art. 2(1)
(1)The directors of a building society shall, with respect to each financial year, prepare for members and depositors a summary financial statement for that year, that is to say, a statement derived from the annual accounts, annual business statement and director’s report, giving a summary account of the society’s financial development during and financial position at the end of the year.
(2)Where the society has [F34connected undertakings] the statement shall (so far as they are dealt with in the group accounts) give an account of the financial development and position of the society and its [F35connected undertakings].
(3)The [F36Treasury may by regulations] make provision with respect to—
(a)the form of the summary financial statement, and
(b)the information which must be included in it.
(4)Every summary financial statement shall also include in the prescribed form statements to the effect that—
(a)it is only a summary of information in the accounts, business statement and directors’ report;
(b)in so far as it summarises the information in the accounts, those accounts have been audited;
(c)the accounts, business statement and director’s report will be available to members and depositors free of charge on demand at every office of the society after a specified date.
(5)Every summary financial statement shall include a statement of the auditors’ opinion as to its consistency with the accounts, business statement and directors’ report and its conformity with the requirements of this section and regulations made under it.
(6)The power to make regulations under subsection (3) above is exercisable by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.
(7)The summary financial statement shall be signed by two directors on behalf of the board of directors and by the chief executive of the society.
[F37(8)Not later than 21 days before the date of the annual general meeting at which the accounts and reports are to be considered, the society shall send one copy of the documents to which this subsection applies to every member of the society who is entitled to receive notice of the meeting, and two copies of the documents to which this subsection applies to the Authority.
(8A)The documents to which subsection (8) applies are—
(a)the summary financial statement, and
(b)where subsection (8) extends under section 78(6) to the auditors’ report also, the auditors’ report.]
[F38(8B)Where a copy of the summary financial statement or of the auditor’s report is required to be sent to a member under subsection (8)—
(a)it may be sent to him electronically only if it is sent to an electronic address notified to the society by the member for the purpose; but
(b)the requirement to send it shall also be treated as satisfied if the conditions set out in subsection (8C) are satisfied.
(8C)The conditions of this subsection are satisfied in the case of a copy of a summary financial statement or auditor’s report if—
(a)the society and the member have agreed that information that is required to be sent to him may instead be accessed by him on a web site;
(b)the agreement applies to the summary financial statement or auditor’s report in question;
(c)the member is notified, in a manner agreed between him and the society, of—
(i)the publication of the summary financial statement and (where applicable) the auditor’s report on a web site,
(ii)the address of that web site, and
(iii)the place on that web site where the statement and (where applicable) the report may be accessed, and how it may be accessed;
(d)the notification given for the purposes of paragraph (c) is given not less than 21 days before the date of the annual general meeting at which the accounts and reports are to be considered; and
(e)a copy of the statement and (where applicable) the report is published on the web site throughout a period beginning at least 21 days before the date of meeting.
(8D)Where, in a case in which subsection (8C) is relied on for compliance with a requirement of subsection (8)—
(a)a copy of a summary financial statement or auditor’s report is published for a part, but not all, of the period mentioned in subsection (8C)(e), and
(b)the failure to publish it throughout that period is wholly attributable to circumstances which it would not be reasonable to have expected the society or the officer to prevent or avoid,
the failure shall not invalidate the proceedings of the meeting at which the accounts and reports are considered, and no offence is committed under subsection (10) by reason of that failure.]
(9)A copy of the summary financial statement and, where this subsection extends under section 78(6) to the auditors’ report also, of the auditors’ report shall be given or sent by the society free of charge, at any time during the period ending with the publication of the next summary financial statement, to—
F39[(a)any individual who for the first time subscribes for shares in the society, on his first subscribing for the shares, and]
(b)any member of the society who was not sent a copy under subsection (8)(a) above, within seven days of his making a demand for a copy.
[F40(9A)Where a copy of the summary financial statement or of the auditor’s report is required under subsection (9)(a) to be sent to an individual who for the first time subscribes for shares in the society (“new subscriber”)—
(a)it may be sent to him electronically only if it is sent to an electronic address notified to the society by that new subscriber for the purpose before or at the time when he subscribes for the shares; but
(b)the requirement to send it shall also be treated as satisfied if the conditions set out in subsection (9B) are satisfied.
(9B)The conditions of this subsection are satisfied in the case of a copy of a summary financial statement or of an auditor’s report if—
(a)before or at the time when he subscribes for the shares, the society and the new subscriber have agreed that information that is required to be sent to him may instead be accessed by him on a web site;
(b)the agreement applies to the summary financial statement or to the auditor’s report in question;
(c)before or at the time when he subscribes for the shares, the new subscriber is notified, in a manner agreed between him and the society, of—
(i)the publication of the summary financial statement or auditor’s report on a web site,
(ii)the address of that web site, and
(iii)the place on that web site where that statement or that report may be accessed, and how it may be accessed; and
(d)a copy of the summary financial statement or of the auditor’s report is published on that web site throughout a period beginning on the date on which the new subscriber is notified in accordance with paragraph (c) and ending no later than the date of the publication of the next summary financial statement.
(9C)Where a copy of the summary financial statement or of the auditor’s report is required to be sent to a member under subsection (9)(b)—
(a)it may be sent to him electronically only if it is sent to an electronic address notified to the society by that member for the purpose; but
(b)the requirement to send it shall also be treated as satisfied if the conditions set out in subsection (9D) are satisfied.
(9D)The requirements of this subsection are satisfied in the case of a copy of a summary financial statement or of an auditor’s report if—
(a)the society and that member have agreed that information that is required to be sent to him may instead be accessed by him on a web site;
(b)the agreement applies to the summary financial statement or auditor’s report in question;
(c)within the seven days specified in subsection (9)(b), the member is notified, in a manner agreed between him and the society, of—
(i)the publication of the summary financial statement or auditor’s report on a web site,
(ii)the address of that web site, and
(iii)the place on that web site where the statement or report may be accessed, and how it may be accessed; and
(d)a copy of the summary financial statement or of the auditor’s report is published on that web site throughout a period beginning on the date on which the member is notified in accordance with paragraph (c) and ending no earlier than the date of the publication of the next summary financial statement.
(9E)Where, in a case in which subsection (9A)(b) or (9C)(b) is relied on for compliance with a requirement under subsection (9),
(a)a copy of a summary financial statement or auditor’s report is published for a part, but not all, of the period mentioned in paragraph (d) of subsection (9B) or (9D) (as the case may be), but
(b)the failure to publish that copy of a statement or report throughout that period is wholly attributable to circumstances which it would not be reasonable to have expected the society or the officer to prevent or avoid,
the failure shall not prevent the requirements of subsection (9) from being treated as fulfilled in relation to that copy of a statement or report, and no offence is committed under subsection (11) by reason of that failure.]
(10)If default is made by a building society in complying with subsection (8) above, the society shall be liable on summary conviction—
(a)to a fine not exceeding level 5 on the standard scale; and
(b)in the case of a continuing offence, to an additional fine not exceeding £200 for every day during which the offence continues,
and so shall any officer who is also guilty of the offence.
(11)If default is made by a building society in complying with subsection (9) above, the society shall be liable on summary conviction—
(a)to a fine not exceeding level 3 on the standard scale; and
(b)in the case of a continuing offence, to an additional fine not exceeding £40 for every day during which the offence continues,
and so shall any officer who is also guilty of the offence.
(12)The [F41Authority shall keep one of the copies] of the summary financial statement received by it under subsection (8) above in the public file of the society.
Textual Amendments
F34Words in s. 76(2) substituted (1.12.1997 in specified cases and for specified purposes and otherwise in accordance with art. 2(2)(3)(5) of S.I. 1997/2668) by 1997 c. 32, ss. 43, 47(3), Sch. 7 para. 33(1)(a); S.I. 1997/2668, art. 2, Sch. Pt. II(w)(z)(xx)
F35Words in s. 76(2) substituted (1.12.1997 in specified cases and for specified purposes and otherwise in accordance with art. 2(2)(3)(5) of S.I. 1997/2668) by 1997 c. 32, ss. 43, 47(3), Sch. 7 para. 33(1)(b); S.I. 1997/2668, art. 2, Sch. Pt. II(w)(z)(xx)
F36Words in s. 76(3) substituted (17.8.2001 for certain purposes and otherwise 1.12.2001) by S.I. 2001/2617, arts. 2(a)(b), 8, 13(1), Sch. 3 para. 168(a) (with art. 13(3), Sch. 5); S.I. 2001/3538, art. 2(1)
F37S. 76(8)(8A) substituted (17.8.2001 for certain purposes and otherwise 1.12.2001) for s. 76(8) by S.I. 2001/2617, arts. 2(a)(b), 8, 13(1), Sch. 3 para. 168(b) (with art. 13(3), Sch. 5); S.I. 2001/3538, art. 2(1)
F38S. 76(8B)-(8D) inserted (20.3.2003) by The Building Societies Act 1986 (Electronic Communications) Order 2003 (S.I. 2003/404), arts. 1(1), 6(2)
F39S. 76(9)(a) substituted (9.6.1997) by 1997 c. 32, s. 43, Sch. 7 para. 33(2); S.I. 1997/1427, art. 2(k)(n)(viii)
F40S. 76(9A)-(9E) inserted (20.3.2003) by The Building Societies Act 1986 (Electronic Communications) Order 2003 (S.I. 2003/404), arts. 1(1), 6(3)
F41Words in s. 76(12) substituted (17.8.2001 for certain purposes and otherwise 1.12.2001) by S.I. 2001/2617, arts. 2(a)(b), 8, 13(1), Sch. 3 para. 168(c) (with art. 13(3), Sch. 5); S.I. 2001/3538, art. 2(1)
Modifications etc. (not altering text)
C9S. 76(3): Functions of the Building Societies Commission transferred (1.12.2001) to the Treasury by S.I. 2001/2617, arts. 2(b), 4(1), Sch. 1 Pt. III (with art. 5); S.I. 2001/3538, art. 2(1)
(1)Every building society shall at each annual general meeting appoint an auditor or auditors to hold office from the conclusion of that meeting until the conclusion of the next annual general meeting.
(2)Schedule 11 to this Act has effect as regards—
(a)the appointment of auditors;
(b)their qualifications and grounds of disqualification, and
(c)the resignation and removal of auditors.
(1)The auditors of a building society shall make a report to the members on the annual accounts which are to be laid before the society at the annual general meeting during their tenure of office.
(2)The auditors’ report shall F42. . . be open to inspection by any member [F43at the annual general meeting of the building society].
(3)The auditors shall, in their report under subsection (1) above, also make a report to the members on—
(a)the annual business statement, and
(b)the directors’ report,
in so far as subsection (7) below requires them to do so.
(4)The auditors’ report shall state whether the annual accounts have been prepared so as to conform to the requirements of this Part and the regulations made under it and whether, in the opinion of the auditors, they give a true and fair view—
(a)in the case of the income and expenditure account, of the income and expenditure of the society for the financial year, [F44and]
(b)in the case of the balance sheet, of the state of the affairs of the society as at the end of the financial year, F45. . .
(c)in the case of the statement of the source and application of funds, of the manner in which the business of the society has been financed and in which its financial resources have been used during the year.
(5)Subsection (4) above, in its application to the group accounts of a society, is to be read as referring to the society and (so far as it concerns the members of the society) the [F46subsidiary undertakings] dealt with in the group accounts.
(6)If the auditors’ report includes a qualification of their opinion that the annual accounts give a true and fair view of the matters specified in subsection (4) above, subsections (8) and (9) of section 76 extend also to the auditors’ report.
(7)The auditors’ report, in so far as it deals with the documents specified in subsection (3) above, shall state whether they have been prepared so as to conform to the requirements of sections 74 and 75 respectively and the regulations thereunder and whether, in the opinion of the auditors—
(a)the information given in the annual business statement gives a true representation of the matters in respect of which it is given, and
(b)the information given in the directors’ report is consistent with the accounting records and the annual accounts for the year.
(8)The auditors’ report on the annual business statement shall not deal with any matters which, by virtue of section 74(6), are not to be the subject of report under this section.
(9)The auditors of a building society shall, as regards the statement of particulars of transactions falling within section 65 which the society is to make available for "inspection by members under section 68(3), examine the statement before it is made available to members and make a report to the members on it; and the report shall be annexed to the statement before it is so made available.
(10)The auditors’ report under subsection (9) above shall state whether in their opinion the statement contains the particulars required by section 68; and where their opinion is that it does not, they shall include in their report, so far as they are reasonably able to do so, a statement giving the requisite particulars.
Textual Amendments
F42Words in s. 78(2) repealed (11.1.1996) by S.I. 1995/3233, art. 6(a)
F43Words in s. 78(2) inserted (11.1.1996) by S.I. 1995/3233, art. 6(b)
F44Word in s. 78(4)(a) inserted (23.3.1999) by S.I. 1999/248, reg. 3, Sch. para. 4
F45S. 78(4)(c) and the word “and" immediately preceding omitted (23.3.1999) by virtue of S.I. 1999/248, reg. 3, Sch. para. 4
F46Words in ss. 71-82 (Pt. VIII) substituted (1.1.1993) by S.I. 1991/1729, art. 3.
Modifications etc. (not altering text)
C10S. 78 restricted (1. 1. 1993) by S.I. 1992/359, reg. 9(4) (with reg. 2(2))
(1)It is the duty of the auditors of a building society in preparing their report to the members under section 78, to carry out such investigations as will enable them to form an opinion as to the following matters—
(a)whether proper accounting records have been kept under section 71,
F47(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(c)whether the annual accounts are in agreement with the accounting records.
(2)If the auditors are of the opinion that the annual accounts are not in agreement with the accounting records they shall state that fact in their report.
(3)Every auditor of a building society has—
(a)a right of access at all times to the accounting and other records of the society and all other documents relating to its business, and
(b)a right to require from the officers of the society such information and explanations as he thinks necessary for the performance of the duties of the auditors.
(4)Where a building society has a [F48connected undertaking], then—
(a)if the [F48connected undertaking] is a body corporate incorporated in any part of the United Kingdom, it is the duty of the [F48connected undertaking] and its auditors to give to the society’s auditors such information and explanation, and such access to documents, as those auditors may reasonably require for the purposes of their duties as auditors of the society;
(b)in any other case, it is the duty of the society, if required by its auditors to do so, to take all such steps as are reasonably open to it to obtain from the [F48connected undertaking] such information and explanation and such access as are mentioned above.
[F49(5)Subsection (4) above applied as regards any body associated with the society which is not a [F50subsidiary undertaking]] as it applies as regards a [F50subsidiary undertaking] of the society.
(6)If the auditors fail to obtain all the information and explanations and the access to documents which, to the best of their knowledge and belief, are necessary for the purposes of their audit, they shall state that fact in their report.
(7)The auditors of a building society have the right—
(a)to attend any general meeting of the society, and to receive all notices of and other communications relating to any general meeting which any member of the society is entitled to receive, and
(b)to be heard at any meeting which they attend on any part of the business of the meeting which concerns them as auditors.
(8)If a building society or other body corporate fails to comply with subsection (4) above, the society or other body shall be liable on summary conviction to a fine not exceeding level 3 on the standard scale and so shall any oficer of the society or, as the case may be, of the other body who is also guilty of the offence; and if an auditor fails without reasonable excuse to comply with paragraph (a) of that subsection he shall be liable, on summary conviction, to such a fine.
(9)If a person who is an officer of a building society or of a body which is a [F51connected undertaking of] the society knowingly or recklessly makes to the auditors of that or another society or body a statement which—
(a)conveys or purports to convey any information or explanation which the auditors require, or are entitled to require, as auditors of the society or other body, as the case may be, and
(b)is false or misleading in a material particular,
that person shall be liable—
(i)on conviction on indictment, to imprisonment for a term not exceeding two years or to a fine, or both; and
(ii)on summary conviction, to imprisonment for a term not exceeding six months or to a fine not exceeding the statutory maximum, or both.
Textual Amendments
F47S. 79(1)(b) repealed (1.12.2001) by S.I. 2001/2617, arts. 2(b), 13(2), Sch. 4 (with art. 13(3), Sch. 5); S.I. 2001/3538, art. 2(1)
F48Words in s. 79(4) substituted (1.12.1997 in specified cases and for specified purposes and otherwise in accordance with art. 2(2)(3)(5) of S.I. 1997/2668) by 1997 c. 32, ss. 43, 47(3), Sch. 7 para. 34(1); S.I. 1997/2668, art. 2, Sch. Pt. II(w)(z)(xxi)
F49S. 79(5) repealed (1.12.1997 in specified cases and for specified purposes and otherwise in accordance with art. 2(2)(3)(5) of S.I. 1997/2668) by 1997 c. 32, ss. 43, 46(2), 47(3), Sch. 7 para. 34(2), Sch. 9; S.I. 1997/2668, art. 2, Sch. Pt. II(w)(y)(z)(xxi)(cc)(xi)
F50Words in ss. 71-82 (Pt. VIII) substituted by S.I. 1991/1729, art. 3.
F51Words in s. 79(9) substituted (1.12.1997 in specified cases and for specified purposes and otherwise in accordance with art. 2(2)(3)(5) of S.I. 1997/2668) by 1997 c. 32, ss. 43, 47(3), Sch. 7 para. 34(3); S.I. 1997/2668, art. 2, Sch. Pt. II(w)(z)(xxi)
Modifications etc. (not altering text)
C11S. 79(1)(2) modified (temp.) by S.I. 1986/2168, art. 12(2)(e)
(1)Every balance sheet of a building society shall be signed by two directors on behalf of the board of directors and by the chief executive of the society.
(2)The income and expenditure account, F52. . . and the annual business statement shall be annexed to the balance sheet, and so shall any group accounts; and the auditor’s report shall be attached to it.
(3)The income and expenditure account, F53. . . and the annual business statement shall be approved by the board of directors before the balance sheet is signed on their behalf, and so shall any group accounts; and the date of their approval of those documents shall be endorsed on the balance sheet.
(4)The directors’ report shall be attached to the balance sheet.
(5)If a balance sheet has not been signed as required by subsection (1) above, and a copy of it is issued, circulated or published, the building society shall be liable on summary conviction to a fine not exceeding level 3 on the standard scale and so shall any officer who is also guilty of the offence.
(6)If any copy of a balance sheet is issued, circulated or published—
(a)without having annexed to it a copy of the income and expenditure account, or
F54(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(c)without having annexed to it a copy of the annual business statement, or
(d)without having attached to it a copy of the auditors’ report, or
(e)without having attached to it a copy of the directors’ report,
the building society shall be liable on summary conviction to a fine not exceeding level 3 on the standard scale and so shall any officer who is also guilty of the offence.
Textual Amendments
F52Words in s. 80(2) omitted (23.3.1999) by virtue of S.I. 1999/248, reg. 3, Sch. para. 5(1)
F53Words in s. 80(3) omitted (23.3.1999) by virtue of S.I. 1999/248, reg. 3, Sch. para. 5(2)
F54S. 80(6)(b) omitted (23.3.1999) by virtue of S.I. 1999/248, reg. 3, Sch. para. 5(3)
(1)The directors of every building society shall lay before the society at the annual general meeting the annual accounts for the last financial year.
(2)The directors of every building society shall send [F56two copies] of the annual accounts for the last financial year to the [F57Authority] not later than 14 days before the annual general meeting at which the accounts are to be considered.
(3)Every building society shall, as from the date by which at the latest its directors are required to send them to the [F58Authority], make copies of the annual accounts available free of charge to members of and depositors with the society at every office of the society and, free of charge, shall send copies of those documents to any member or depositor who demands it.
[F59(3A)Where a copy of the annual accounts is required to be sent to a member or depositor under subsection (3)—
(a)they may be sent to him electronically only if they are sent to an electronic address notified to the society by that member or depositor for the purpose; but
(b)the requirement to send them shall also be treated as satisfied if the conditions set out in subsection (3B) are satisfied.
(3B)The conditions of this subsection are satisfied in the case of a copy of the annual accounts if—
(a)the society and the member or depositor have agreed that information that is required to be sent to him may instead be accessed by him on a web site;
(b)the agreement applies to the annual accounts in question;
(c)within seven days of his demand, the member or depositor is notified, in a manner agreed for the purpose between him and the society, of—
(i)the publication of the accounts on a web site,
(ii)the address of that web site, and
(iii)the place on that web site where the accounts may be accessed, and how they may be accessed; and
(d)the accounts are published on that web site throughout the period beginning on the date on which the member or depositor is notified in accordance with paragraph (c) and ending with the conclusion of the annual general meeting at which the accounts are to be considered.]
(4)If default is made in complying with subsection (1) or (2) above, every person who was a director at any time during the relevant period shall be liable on summary conviction—
(a)to a fine not exceeding level 5 on the standard scale; and
(b)in the case of a continuing offence, to an additional fine not exceeding £200 for every day during which the offence continues.
(5)If, on demand made of it under subsection (3) above, a building society fails, in accordance with that subsection, to make available or, as the case may be, within seven days of the demand, to send, to a person a copy of the annual accounts the society shall be liable on summary conviction—
(a)to a fine not exceeding level 3 on the standard scale; and
(b)in the case of a continuing offence, to an additional fine not exceeding £40 for every day during which the offence continues,
and so shall any officer who is also guilty of the offence.
[F60(5A)Where, in a case in which subsection (3A)(b) is relied on for compliance with a requirement under subsection (3)—
(a)a copy of the annual accounts is published for a part, but not all, of the period mentioned in subsection (3B)(d), but
(b)the failure to publish it throughout that period is wholly attributable to circumstances which it would not be reasonable to have expected the society or the officer to prevent or avoid,
no offence is committed under subsection (5) by reason of that failure.]
(6)In subsection (4) above “the relevant period” means the period beginning at the end of the last financial year and ending with the date which falls 14 days before the annual general meeting following the end of that year.
(7)The [F61Authority shall keep one of the copies] of the annual accounts of a building society received by it under subsection (2) above in the public file of the society.
(8)In this section any reference to the annual accounts includes a reference to the documents annexed or attached to them under section 80.
Textual Amendments
F55Words in s. 81 side-note substituted (17.8.2001 for certain purposes and otherwise 1.12.2001) by S.I. 2001/2617, arts. 2(a)(b), 8, 13(1), Sch. 3 para. 170(a) (with art. 13(3), Sch. 5); S.I. 2001/3538, art. 2(1)
F56Words in s. 81(2) substituted (17.8.2001 for certain purposes and otherwise 1.12.2001) by S.I. 2001/2617, arts. 2(a)(b), 8, 13(1), Sch. 3 para. 170(b)(i) (with art. 13(3), Sch. 5); S.I. 2001/3538, art. 2(1)
F57Words in s. 81(2) substituted (17.8.2001 for certain purposes and otherwise 1.12.2001) by S.I. 2001/2617, arts. 2(a)(b), 8, 13(1), Sch. 3 para. 170(b)(ii) (with art. 13(3), Sch. 5); S.I. 2001/3538, art. 2(1)
F58Words in s. 81(3) substituted (17.8.2001 for certain purposes and otherwise 1.12.2001) by S.I. 2001/2617, arts. 2(a)(b), 8, 13(1), Sch. 3 Pt. II para. 170(c) (with art. 13(3), Sch. 5); S.I. 2001/3538, art. 2(1)
F59S. 81(3A)(3B) inserted (20.3.2003) by The Building Societies Act 1986 (Electronic Communications) Order 2003 (S.I. 2003/404), arts. 1(1), 7(2)
F60S. 81(5A) inserted (20.3.2003) by The Building Societies Act 1986 (Electronic Communications) Order 2003 (S.I. 2003/404), arts. 1(1), 7(3)
F61Words in s. 81(7) substituted (17.8.2001 for certain purposes and otherwise 1.12.2001) by S.I. 2001/2617, arts. 2(a)(b), 8, 13(1), Sch. 3 para. 170(d) (with art. 13(3), Sch. 5); S.I. 2001/3538, art. 2(1)
Textual Amendments
F62S. 82 repealed (1.12.2001) by S.I. 2001/2617, arts. 2(b), 13(2), Sch. 4 (with art. 13(3), Sch. 5); S.I. 2001/3538, art. 2(1)
The Whole Act you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.
Would you like to continue?
The Whole Act you have selected contains over 200 provisions and might take some time to download.
Would you like to continue?
The Whole Act you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.
Would you like to continue?
The Schedules you have selected contains over 200 provisions and might take some time to download. You may also experience some issues with your browser, such as an alert box that a script is taking a long time to run.
Would you like to continue?
Latest Available (revised):The latest available updated version of the legislation incorporating changes made by subsequent legislation and applied by our editorial team. Changes we have not yet applied to the text, can be found in the ‘Changes to Legislation’ area.
Original (As Enacted or Made): The original version of the legislation as it stood when it was enacted or made. No changes have been applied to the text.
Point in Time: This becomes available after navigating to view revised legislation as it stood at a certain point in time via Advanced Features > Show Timeline of Changes or via a point in time advanced search.
Geographical Extent: Indicates the geographical area that this provision applies to. For further information see ‘Frequently Asked Questions’.
Show Timeline of Changes: See how this legislation has or could change over time. Turning this feature on will show extra navigation options to go to these specific points in time. Return to the latest available version by using the controls above in the What Version box.
Access essential accompanying documents and information for this legislation item from this tab. Dependent on the legislation item being viewed this may include:
This timeline shows the different points in time where a change occurred. The dates will coincide with the earliest date on which the change (e.g an insertion, a repeal or a substitution) that was applied came into force. The first date in the timeline will usually be the earliest date when the provision came into force. In some cases the first date is 01/02/1991 (or for Northern Ireland legislation 01/01/2006). This date is our basedate. No versions before this date are available. For further information see the Editorial Practice Guide and Glossary under Help.
Use this menu to access essential accompanying documents and information for this legislation item. Dependent on the legislation item being viewed this may include:
Click 'View More' or select 'More Resources' tab for additional information including: