Part 15Accounts and reports
Chapter 5Directors' report
Directors' report
418Contents of directors' report: statement as to disclosure to auditors
1
This section applies to a company unless—
a
it is exempt for the financial year in question from the requirements of Part 16 as to audit of accounts, and
b
the directors take advantage of that exemption.
2
The directors' report must contain a statement to the effect that, in the case of each of the persons who are directors at the time the report is approved—
a
so far as the director is aware, there is no relevant audit information of which the company’s auditor is unaware, and
b
he has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company’s auditor is aware of that information.
3
“Relevant audit information” means information needed by the company’s auditor in connection with preparing his report.
4
A director is regarded as having taken all the steps that he ought to have taken as a director in order to do the things mentioned in subsection (2)(b) if he has—
a
made such enquiries of his fellow directors and of the company’s auditors for that purpose, and
b
taken such other steps (if any) for that purpose,
as are required by his duty as a director of the company to exercise reasonable care, skill and diligence.
5
Where a directors' report containing the statement required by this section is approved but the statement is false, every director of the company who—
a
knew that the statement was false, or was reckless as to whether it was false, and
b
failed to take reasonable steps to prevent the report from being approved,
commits an offence.
6
A person guilty of an offence under subsection (5) is liable—
a
on conviction on indictment, to imprisonment for a term not exceeding two years or a fine (or both);
b
on summary conviction—
i
in England and Wales, to imprisonment for a term not exceeding twelve months or to a fine not exceeding the statutory maximum (or both);
ii
in Scotland or Northern Ireland, to imprisonment for a term not exceeding six months, or to a fine not exceeding the statutory maximum (or both).