http://www.legislation.gov.uk/id/uksi/1996/189

http://www.legislation.gov.uk/uksi/1996/189/regulation/14/made

The Companies Act 1985 (Miscellaneous Accounting Amendments) Regulations 1996

Legislation

King's Printer of Acts of Parliament

2016-03-11

COMPANIES

These Regulations make a number of miscellaneous amendments to the provisions of the Companies Act 1985(c. 6) (“the 1985 Act”) concerning accounts and audit. The principal changes are as follows:Regulation 2 amends section 224 of the 1985 Act (accounting reference periods and accounting reference date) to alter the method by which the accounting reference date of companies incorporated on or after 1st April 1996 is calculated.Regulation 3 amends section 225 of the 1985 Act (alteration of accounting reference date) to widen the circumstances in which the accounting reference date of a company may be changed.Regulation 5(3) amends section 234 of the 1985 Act (duty to prepare directors' report) by inserting in subsection (4) a reference to new Part VI of Schedule 7 to the 1985 Act. Regulation 14(5) amends Schedule 7 to the 1985 Act by the insertion of a new Part VI. Part VI provides that the directors' report of public companies and large private companies which are subsidiaries of a public company must contain a statement of the company’s policy on payment of its suppliers. Companies which follow any code or standard on payment practice must state what code or standard is followed and where information about it can be found; companies which do not follow such codes or standards must give a fuller statement on their payment practices.Regulation 10 amends section 249B of the 1985 Act (cases where exemption from audit not available). The amendment enables a company which would otherwise be disqualified from claiming exemption from audit under section 249A of the 1985 Act for a financial year because it was a subsidiary undertaking for any period in that year, to claim that exemption provided it was dormant throughout that period.Regulation 13 and paragraphs 3, 4, 6, 10 and 18 of Schedule 5 to the Regulations make certain amendments to the provisions of the 1985 Act concerning the accounts of insurance companies and groups so as to align those provisions more closely with the provisions of the Insurance Accounts Directive (Council Directive 91/674/EEC Official Journal No. L374 of 31.12.91, pages 7 to 31). Regulation 14(8) and Schedule 6 to the Regulations contain amendments to Schedule 11 to the 1985 Act (modifications of Part VIII where company’s accounts prepared in accordance with special provisions for banking or insurance companies) consequential on those amendments.Regulation 14(1) and Schedule 1 to the Regulations contain amendments to Schedule 4 to the 1985 Act (form and content of company accounts).Regulation 14(2) and Schedule 2 to the Regulations contain amendments to Schedule 4A to the 1985 Act (form and content of group accounts).Regulation 14(3) and Schedule 3 to the Regulations contain amendments to Schedule 5 to the 1985 Act (disclosure of information : related undertakings).Regulation 14(4) repeals certain provisions in Schedule 7 to the 1985 Act concerning the matters to be dealt with in the directors' report.Regulation 14(6) and Schedule 4 to the Regulations contain amendments to Schedule 9 to the 1985 Act (form and content of accounts of banking companies and groups).Regulation 14(7) and Schedule 5 to the Regulations contain amendments to Schedule 9A to the 1985 Act (form and content of accounts of insurance companies and groups) in addition to those mentioned in paragraph e) above.Regulation 15 makes certain minor and consequential amendments to sections 231 and 255A of, and Schedules 7 and 8 to, the 1985 Act, and regulation 16 makes provision concerning the application of the Regulations and contains transitional provisions.

Amendment of Schedules14

1

Schedule 4 to the 1985 Act (form and content of company accounts)15 is amended in accordance with Schedule 1 to these Regulations.

2

Schedule 4A to the 1985 Act (form and content of group accounts)16 is amended in accordance with Schedule 2 to these Regulations.

3

Schedule 5 to the 1985 Act (disclosure of information: related undertakings)17 is amended in accordance with Schedule 3 to these Regulations.

4

The following provisions of Schedule 7 to the 1985 Act (matters to be dealt with in the directors' report) are hereby repealed—

a

paragraph 1(1) (significant changes in fixed assets)18,

b

paragraph 5A (insurance effected for officers or auditors)19, and

c

Part IV (health, safety and welfare at work of company’s employees).

5

At the end of that Schedule insert the following Part—

PART VIPOLICY ON THE PAYMENT OF CREDITORS
12
1
This Part of this Schedule applies to a report by the directors of a company for a financial year if—
a
the company was at any time within the financial year a public company, or
b
the company did not qualify as small or medium-sized in relation to the financial year by virtue of section 247 and was at any time within the year a member of a group of which the parent company was a public company.
2
The report shall, with respect to the financial year immediately following that covered by the report, state—
a
whether in respect of some or all of its suppliers it is the company’s policy to follow any code or standard on payment practice and, if so, the name of the code or standard and the place where information about, and copies of, the code or standard can be obtained,
b
whether in respect of some or all of its suppliers it is the company’s policy—
i
to settle the terms of payment with those suppliers when agreeing the terms of each transaction,
ii
to ensure that those suppliers are made aware of the terms of payment, and
iii
to abide by the terms of payment,
c
where the company’s policy is not as mentioned in paragraph (a) or (b) in respect of some or all of its suppliers, what its policy is with respect to the payment of those suppliers.
3
If the company’s policy is different for different suppliers or classes of suppliers, the report shall identify the suppliers or classes of suppliers to which the different policies apply.
4
For the purposes of this Part of this Schedule a supplier is any person whose claim on the reporting company in respect of goods or services supplied would be included under “trade creditors” within “Creditors; amounts falling due within one year” in a balance sheet drawn up in accordance with balance sheet format 1 in Schedule 4.

6

Schedule 9 to the 1985 Act (form and content of accounts of banking companies and groups)20 is amended in accordance with Schedule 4 to these Regulations.

7

Schedule 9A to the 1985 Act (form and content of accounts of insurance companies and groups)21 is amended in accordance with Schedule 5 to these Regulations.

8

Schedule 11 to the 1985 Act (modifications of Part VIII where company’s accounts prepared in accordance with special provisions for banking or insurance companies)22 is amended in accordance with Schedule 6 to these Regulations.