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Sections 64(8) & 72.

SCHEDULE 6N.I.GROUP ACCOUNTS

This schedule has no associated Explanatory Notes

InterpretationN.I.

1—(1) This paragraph applies for the purposes of this Schedule.N.I.

(2) A charity is a “parent charity” if it is (or is to be treated as) a parent undertaking in relation to one or more other undertakings in accordance with the provisions of section 1162 of, and Schedule 7 to, the Companies Act 2006 (c. 46).

(3) Each undertaking in relation to which a parent charity is (or is to be treated as) a parent undertaking in accordance with those provisions is a “subsidiary undertaking” in relation to the parent charity.

(4) But sub-paragraph (3) does not have the result that any of the following is a “subsidiary undertaking”—

(a)any special trusts of a charity,

(b)any institution which, by virtue of a direction under section 1(4), is to be treated as forming part of a charity for the purposes of this Part of this Act, or

(c)any charity to which a direction under section 1(5) applies for those purposes.

(5) “The group”, in relation to a parent charity, means that charity and its subsidiary undertaking or undertakings, and any reference to the members of the group is to be construed accordingly.

(6) For the purposes of—

(a)this paragraph, and

(b)the operation of the provisions mentioned in sub-paragraph (2) for the purposes of this paragraph,

undertaking” has the meaning given by sub-paragraph (7).

(7) For those purposes “undertaking” means—

(a)an undertaking as defined by section 1161(1) of the Companies Act 2006 (c. 46), or

(b)a charity which is not an undertaking as so defined.

Commencement Information

I1Sch. 6 para. 1 in operation at 1.1.2016 by S.R. 2015/383, art. 2(3), Sch.

Accounting recordsN.I.

2—(1) The charity trustees—N.I.

(a)of a parent charity, or

(b)of any charity which is a subsidiary undertaking,

must ensure that the accounting records kept in respect of the charity under section 63(1) or, as the case may be, section 386 of the Companies Act 2006 (duty to keep accounting records) not only comply with the requirements of that provision but also are such as to enable the charity trustees of the parent charity to ensure that, where any group accounts are prepared by them under paragraph 3(2), those accounts comply with the relevant requirements.

(2) If a parent charity has a subsidiary undertaking in relation to which the requirements of section 63(1) or section 386 of the Companies Act 2006 do not apply, the charity trustees of the parent charity must take reasonable steps to secure that the undertaking keeps such accounting records as to enable the trustees to ensure that, where any group accounts are prepared by them under paragraph 3(2), those accounts comply with the relevant requirements.

(3) In this paragraph “the relevant requirements” means the requirements of regulations under paragraph 3.

Commencement Information

I2Sch. 6 para. 2 in operation at 1.1.2016 by S.R. 2015/383, art. 2(3), Sch.

Preparation of group accountsN.I.

3—(1) This paragraph applies in relation to a financial year of a charity if—N.I.

(a)the charity is a parent charity at the end of that year; and

(b)(where it is a company) it is not required to prepare consolidated accounts for that year under section 399 of the Companies Act 2006 (c. 46) (duty to prepare group accounts), whether or not such accounts are in fact prepared.

(2) The charity trustees of the parent charity must prepare group accounts in respect of that year.

(3) “Group accounts” means consolidated accounts—

(a)relating to the group, and

(b)complying with such requirements as to their form and contents as may be prescribed by regulations made by the Department.

(4) Without prejudice to the generality of sub-paragraph (3), regulations under that sub-paragraph may make provision—

(a)for any such accounts to be prepared in accordance with such methods and principles as are specified or referred to in the regulations;

(b)for dealing with cases where the financial years of the members of the group do not all coincide;

(c)as to any information to be provided by way of notes to the accounts.

(5) Regulations under that sub-paragraph may also make provision—

(a)for determining the financial years of subsidiary undertakings for the purposes of this Schedule;

(b)for imposing on the charity trustees of a parent charity requirements with respect to securing that such financial years coincide with that of the charity.

(6) If the requirement in sub-paragraph (2) applies to the charity trustees of a parent charity (other than a parent charity which is a company) in relation to a financial year—

(a)that requirement so applies in addition to the requirement in section 64(1), and

(b)the option of preparing the documents mentioned in section 64(3) is not available in relation to that year (whatever the amount of the charity's gross income for that year).

(7) If the requirement in sub-paragraph (2) applies to the charity trustees of a parent charity in relation to a financial year and the charity is a company, that requirement so applies in addition to the requirement in section 394 of the Companies Act 2006 (duty to prepare individual accounts).

(8) Sub-paragraph (2) has effect subject to paragraph 4.

Commencement Information

I3Sch. 6 para. 3(1)(2) (6)-(8) in operation at 1.1.2016 by S.R. 2015/383, art. 2(3), Sch.

I4Sch. 6 para. 3(3)-(5) in operation at 28.11.2015 for specified purposes by S.R. 2015/383, art. 2(2)

I5Sch. 6 para. 3(3)-(5) in operation at 1.1.2016 in so far as not already in operation by S.R. 2015/383, art. 2(3), Sch.

Exceptions relating to requirement to prepare group accountsN.I.

4—(1) The requirement in paragraph 3(2) does not apply to the charity trustees of a parent charity in relation to a financial year if at the end of that year it is itself a subsidiary undertaking in relation to another charity.N.I.

(2) The requirement in paragraph 3(2) does not apply to the charity trustees of a parent charity in relation to a financial year if the aggregate gross income of the group for that year does not exceed such sum as is specified in regulations made by the Department.

(3) Regulations made by the Department may prescribe circumstances in which a subsidiary undertaking may or (as the case may be) must be excluded from group accounts required to be prepared under paragraph 3(2) for a financial year.

(4) Where, by virtue of such regulations, each of the subsidiary undertakings which are members of a group is either permitted or required to be excluded from any such group accounts for a financial year, the requirement in paragraph 3(2) does not apply to the charity trustees of the parent charity in relation to that year.

Commencement Information

I6Sch. 6 para. 4(1)(4) in operation at 1.1.2016 by S.R. 2015/383, art. 2(3), Sch.

I7Sch. 6 para. 4(2)(3) in operation at 28.11.2015 for specified purposes by S.R. 2015/383, art. 2(2)

I8Sch. 6 para. 4(2)(3) in operation at 1.1.2016 in so far as not already in operation by S.R. 2015/383, art. 2(3), Sch.

Preservation of group accountsN.I.

5—(1) The charity trustees of a charity shall preserve any group accounts prepared by them under paragraph 3(2) for at least 6 years from the end of the financial year to which the accounts relate.N.I.

(2) Subsection (4) of section 63 shall apply in relation to the preservation of any such accounts as it applies in relation to the preservation of any accounting records (the references to subsection (3) of that section being construed as references to sub-paragraph (1) above).

(3) For the purposes of sub-paragraph (2), section 63 applies as if subsection (5) of that section were omitted.

Commencement Information

I9Sch. 6 para. 5 in operation at 1.1.2016 by S.R. 2015/383, art. 2(3), Sch.

Audit accounts of larger groupsN.I.

6—(1) This paragraph applies where group accounts are prepared for a financial year of a parent charity under paragraph 3(2) and—N.I.

(a)the aggregate gross income of the group in that year exceeds the relevant income threshold, or

(b)the aggregate gross income of the group in that year exceeds the relevant income threshold and at the end of the year the aggregate value of the assets of the group (before deduction of liabilities) exceeds the relevant assets threshold.

(2) In sub-paragraph (1)—

(a)the reference in head (a) or (b) to the relevant income threshold is a reference to the sum prescribed as the relevant income threshold for the purposes of that head, and

(b)the reference in head (b) to the relevant assets threshold is a reference to the sum prescribed as the relevant assets threshold for the purposes of that head.

Prescribed” means prescribed by regulations made by the Department.

(3) This paragraph also applies where group accounts are prepared for a financial year of a parent charity under paragraph 3(2) and the appropriate audit provision applies in relation to the parent charity's own accounts for that year.

(4) If this paragraph applies in relation to a financial year of a parent charity by virtue of sub-paragraph (1) or (3), the group accounts for that year shall be audited by a person within section 65(2)(a) or (b).

(5) Where it appears to the Commission that sub-paragraph (4) has not been complied with in relation to that year within 10 months from the end of that year—

(a)the Commission may by order require the group accounts for that year to be audited by a person within section 65(2)(a) or (b), and

(b)if it so orders, the auditor shall be a person appointed by the Commission.

(6) Section 65(8) shall apply in relation to any such audit as it applies in relation to an audit carried out by an auditor appointed under section 65(6) (reading the reference to the funds of the charity as a reference to the funds of the parent charity).

(7) If this paragraph applies in relation to a financial year of a parent charity by virtue of sub-paragraph (1)—

(a)subject to head (b), the appropriate audit provision shall apply in relation to the parent charity's own accounts for that year (whether or not it would otherwise so apply);

(b)where the parent charity is a company and its own accounts for that year are not required to be audited in accordance with Part 16 of the Companies Act 2006 (c. 46), section 65(2) shall apply in relation to those accounts (whether or not it would otherwise so apply).

(8) In this paragraph, “the appropriate audit provision”, in relation to a financial year of a parent company, means—

(a)subject to head (b), section 65(2);

(b)if the parent charity is a company, section 65(2) or Part 16 of the Companies Act 2006 (as the case may be).

Commencement Information

I10Sch. 6 para. 6(1) (3)-(8) in operation at 1.1.2016 by S.R. 2015/383, art. 2(3), Sch.

I11Sch. 6 para. 6(2) in operation at 28.11.2015 for specified purposes by S.R. 2015/383, art. 2(2)

I12Sch. 6 para. 6(2) in operation at 1.1.2016 in so far as not already in operation by S.R. 2015/383, art. 2(3), Sch.

Examination of accounts of smaller groupsN.I.

7—(1) This paragraph applies where—N.I.

(a)group accounts are prepared for a financial year of a parent charity under paragraph 3(2), and

(b)paragraph 6 does not apply in relation to that year.

(2) If this paragraph applies in relation to a financial year of a parent charity, subsections (3) to (9) of section 65 shall apply in relation to the group accounts for that year as they apply in relation to the accounts of a charity for a financial year in relation to which subsection (2) of that section does not apply, but subject to the modifications in sub-paragraph (3) below.

(3) The modifications are—

(a)any reference to the charity trustees of the charity is to be construed as a reference to the charity trustees of the parent charity;

(b)any reference to the charity's gross income in the financial year in question is to be construed as a reference to the aggregate gross income of the group in that year; and

(c)any reference to the funds of the charity is to be construed as a reference to the funds of the parent charity.

(4) If the group accounts for a financial year of a parent charity are to be examined or audited in accordance with section 65(3) (as applied by sub-paragraph (2) above), section 65(3) shall apply in relation to the parent charity's own accounts for that year (whether or not it would otherwise so apply).

Commencement Information

I13Sch. 6 para. 7 in operation at 1.1.2016 by S.R. 2015/383, art. 2(3), Sch.

Supplementary provisions relating to audits, etc.N.I.

8—(1) Section 66(1) shall apply in relation to audits and examinations carried out under or by virtue of paragraph 6 or 7, but subject to the modifications in sub-paragraph (2) below.N.I.

(2) The modifications are—

(a)in paragraph (b), the reference to section 65 is to be construed as a reference to paragraph 6 above or to any of that section as applied by paragraph 7 above;

(b)also in paragraph (b), the reference to any such statement of accounts as is mentioned in sub-paragraph (i) of that paragraph is to be construed as a reference to group accounts prepared for a financial year under paragraph 3(2) above;

(c)in paragraph (c), any reference to section 65 is to be construed as a reference to that section as applied by paragraph 7 above;

(d)in paragraphs (d) and (e), any reference to the charity concerned or a charity is to be construed as a reference to any member of the group; and

(e)in paragraph (f), the reference to the requirements of section 65(2) or (3) is to be construed as a reference to the requirements of paragraph 6(4) [F1or of section 65(3) as applied] by paragraph 7(2) above.

(3) Without prejudice to the generality of section 66(1)(e), as modified by sub-paragraph (2)(d) above, regulations made under that provision may make provision corresponding or similar to any provision made by section 499 or 500 of the Companies Act 2006 (c. 46) in connection with the rights exercisable by an auditor of a company in relation to a subsidiary undertaking of the company.

(4) In section 66(2) the reference to section [F266](1)(d) or (e) includes a reference to that provision as it applies in accordance with this paragraph[F3and for this purpose the reference in section 66(2)(b) to the charity trustees for the time being of the charity concerned is to be construed as a reference to the charity trustees for the time being of such member of the group as the Commission thinks appropriate].

Textual Amendments

Commencement Information

I14Sch. 6 para. 8(1)(2)(4) in operation at 1.1.2016 by S.R. 2015/383, art. 2(3), Sch.

I15Sch. 6 para. 8(3) in operation at 28.11.2015 for specified purposes by S.R. 2015/383, art. 2(2)

I16Sch. 6 para. 8(3) in operation at 1.1.2016 in so far as not already in operation by S.R. 2015/383, art. 2(3), Sch.

Duty of auditors, etc. to report matters to CommissionN.I.

9—(1) Section 67(2) to (5) F4... shall apply in relation to a person appointed to audit, or report on, any group accounts under or by virtue of paragraph 6 or 7 as they apply in relation to a person such as is mentioned in section 67(1).N.I.

(2) In section 67(2)(a), as it applies in accordance with sub-paragraph (1), the reference to the charity or any connected institution or body is to be construed as a reference to the parent charity or any of its subsidiary undertakings.

Textual Amendments

Commencement Information

I17Sch. 6 para. 9 in operation at 1.1.2016 by S.R. 2015/383, art. 2(3), Sch.

Annual reportsN.I.

10—(1) This paragraph applies where group accounts are prepared for a financial year of a parent charity under paragraph 3(2).N.I.

(2) The annual report prepared by the charity trustees of the parent charity in respect of that year under section 68 shall include—

(a)such a report by the trustees on the activities of the charity's subsidiary undertakings during that year, and

(b)such other information relating to any of those undertakings,

as may be prescribed by regulations made by the Department.

(3) Without prejudice to the generality of sub-paragraph (2), regulations under that sub-paragraph may make provision—

(a)for any such report as is mentioned in head (a) of that sub-paragraph to be prepared in accordance with such principles as are specified or referred to in the regulations;

(b)enabling the Commission to dispense with any requirement prescribed by virtue of sub-paragraph (2)(b) in the case of a particular subsidiary undertaking or a particular class of subsidiary undertaking.

(4) When transmitted to the Commission in accordance with section 68(3), the annual report shall have attached to it both the group accounts prepared for that year under paragraph 3(2) and—

(a)a copy of the report made by the auditor on those accounts; or

(b)where those accounts have been examined under section 65 (as applied by paragraph 7 above), a copy of the report made by the person carrying out the examination.

(5) The requirements in this paragraph are in addition to those in section 68.

Commencement Information

I18Sch. 6 para. 10(1)(4)(5) in operation at 1.1.2016 by S.R. 2015/383, art. 2(3), Sch.

I19Sch. 6 para. 10(2)(3) in operation at 28.11.2015 for specified purposes by S.R. 2015/383, art. 2(2)

I20Sch. 6 para. 10(2)(3) in operation at 1.1.2016 in so far as not already in operation by S.R. 2015/383, art. 2(3), Sch.

Public inspection of annual reports, etc.N.I.

11  In section 69(3), the reference to a charity's most recent accounts includes, in relation to a charity whose charity trustees have prepared any group accounts under paragraph 3(2), the group accounts most recently prepared by them.N.I.

Commencement Information

I21Sch. 6 para. 11 in operation at 1.1.2016 by S.R. 2015/383, art. 2(3), Sch.

OffencesN.I.

12—(1) Section 71(1) applies in relation to a requirement within sub-paragraph (2) as it applies in relation to a requirement within section 71(1)(a).N.I.

(2) A requirement is within this sub-paragraph where it is imposed by section 68(3), taken with—

(a)section 68(4) and (5), and

(b)paragraph 10(4) above,

as applicable.

(3) In sub-paragraph (2) the reference to section 68(3) is a reference to that provision as applied by paragraph 10(4).

(4) In section 71(1)(b) the reference to section 69(3) includes a reference to that provision as extended by paragraph 11.

Commencement Information

I22Sch. 6 para. 12 in operation at 1.1.2016 by S.R. 2015/383, art. 2(3), Sch.

Aggregate gross incomeN.I.

13  The Department may by regulations make provision for determining for the purposes of this Schedule the amount of the aggregate gross income for a financial year of a group consisting of a parent charity and its subsidiary undertaking or undertakings.N.I.

Commencement Information

I23Sch. 6 para. 13 in operation at 28.11.2015 for specified purposes by S.R. 2015/383, art. 2(2)

I24Sch. 6 para. 13 in operation at 1.1.2016 in so far as not already in operation by S.R. 2015/383, art. 2(3), Sch.

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