|
| |
|
| |
482 | Fixing of auditor’s remuneration |
| |
(1) | The remuneration of an auditor appointed by the members of a company must |
| |
be fixed by the members by ordinary resolution or in such manner as the |
| |
members may by ordinary resolution determine. |
| 5 |
(2) | The remuneration of an auditor appointed by the directors of a company must |
| |
be fixed by the directors. |
| |
(3) | The remuneration of an auditor appointed by the Secretary of State must be |
| |
fixed by the Secretary of State. |
| |
(4) | For the purposes of this section “remuneration” includes sums paid in respect |
| 10 |
| |
(5) | This section applies in relation to benefits in kind as to payments of money. |
| |
483 | Disclosure of terms of audit appointment |
| |
(1) | The Secretary of State may make provision by regulations for securing the |
| |
disclosure of the terms on which a company’s auditor is appointed, |
| 15 |
remunerated or performs his duties. |
| |
| Nothing in the following provisions of this section affects the generality of this |
| |
| |
| |
(a) | require disclosure of— |
| 20 |
(i) | a copy of any terms that are in writing and |
| |
(ii) | a written memorandum setting out any terms that are not in |
| |
| |
(b) | require disclosure to be at such times, in such places and by such means |
| |
as are specified in the regulations; |
| 25 |
(c) | require the place and means of disclosure to be stated— |
| |
(i) | in a note to the company’s annual accounts (in the case of its |
| |
individual accounts) or in such manner as is specified in the |
| |
regulations (in the case of group accounts), |
| |
(ii) | in the directors’ report, or |
| 30 |
(iii) | in the auditor’s report on the company’s annual accounts. |
| |
(3) | The provisions of this section apply to a variation of the terms mentioned in |
| |
subsection (1) as they apply to the original terms. |
| |
(4) | Regulations under this section are subject to affirmative resolution procedure. |
| |
484 | Disclosure of services provided by auditor or associates and related |
| 35 |
| |
(1) | The Secretary of State may make provision by regulations for securing the |
| |
| |
(a) | the nature of any services provided for a company by the company’s |
| |
auditor (whether in his capacity as auditor or otherwise) or by his |
| 40 |
| |
|
| |
|
| |
|
(b) | the amount of any remuneration received or receivable by a company’s |
| |
auditor, or his associates, in respect of any such services. |
| |
| Nothing in the following provisions of this section affects the generality of this |
| |
| |
(2) | The regulations may provide— |
| 5 |
(a) | for disclosure of the nature of any services provided to be made by |
| |
reference to any class or description of services specified in the |
| |
regulations (or any combination of services, however described); |
| |
(b) | for the disclosure of amounts of remuneration received or receivable in |
| |
respect of services of any class or description specified in the |
| 10 |
regulations (or any combination of services, however described); |
| |
(c) | for the disclosure of separate amounts so received or receivable by the |
| |
company’s auditor or any of his associates, or of aggregate amounts so |
| |
received or receivable by all or any of those persons. |
| |
| 15 |
(a) | provide that “remuneration” includes sums paid in respect of expenses; |
| |
(b) | apply to benefits in kind as well as to payments of money, and require |
| |
the disclosure of the nature of any such benefits and their estimated |
| |
| |
(c) | apply to services provided for associates of a company as well as to |
| 20 |
those provided for a company; |
| |
(d) | define “associate” in relation to an auditor and a company respectively. |
| |
(4) | The regulations may provide that any disclosure required by the regulations is |
| |
| |
(a) | in a note to the company’s annual accounts (in the case of its individual |
| 25 |
accounts) or in such manner as is specified in the regulations (in the |
| |
| |
(b) | in the directors’ report, or |
| |
(c) | in the auditor’s report on the company’s annual accounts. |
| |
(5) | If the regulations provide that any such disclosure is to be made as mentioned |
| 30 |
in subsection (4)(a) or (b), the regulations may require the auditor to supply the |
| |
directors of the company with any information necessary to enable the |
| |
| |
(6) | Regulations under this section are subject to negative resolution procedure. |
| |
| 35 |
| |
| |
485 | Auditor’s report on company’s annual accounts |
| |
(1) | A company’s auditor must make a report to the company’s members on all |
| |
annual accounts of the company of which copies are, during his tenure of |
| 40 |
| |
(a) | in the case of a private company, to be sent out to members under |
| |
| |
|
| |
|
| |
|
(b) | in the case of a public company, to be laid before the company in |
| |
general meeting under section 421. |
| |
(2) | The auditor’s report must include— |
| |
(a) | an introduction identifying the annual accounts that are the subject of |
| |
the audit and the financial reporting framework that has been applied |
| 5 |
in their preparation, and |
| |
(b) | a description of the scope of the audit identifying the auditing |
| |
standards in accordance with which the audit was conducted. |
| |
(3) | The report must state clearly whether, in the auditor’s opinion, the annual |
| |
| 10 |
(a) | give a true and fair view— |
| |
(i) | in the case of an individual balance sheet, of the state of affairs |
| |
of the company as at the end of the financial year, |
| |
(ii) | in the case of an individual profit and loss account, of the profit |
| |
or loss of the company for the financial year, |
| 15 |
(iii) | in the case of group accounts, of the state of affairs as at the end |
| |
of the financial year and of the profit or loss for the financial |
| |
year of the undertakings included in the consolidation as a |
| |
whole, so far as concerns members of the company; |
| |
(b) | have been properly prepared in accordance with the relevant financial |
| 20 |
| |
(c) | have been prepared in accordance with the requirements of this Act |
| |
(and, where applicable, Article 4 of the IAS Regulation). |
| |
| Expressions used in this subsection that are defined for the purposes of Part 15 |
| |
(see section 458) have the same meaning as in that Part. |
| 25 |
(4) | The auditor’s report— |
| |
(a) | must be either unqualified or qualified, and |
| |
(b) | must include a reference to any matters to which the auditor wishes to |
| |
draw attention by way of emphasis without qualifying the report. |
| |
486 | Auditor’s report on directors’ report |
| 30 |
| The auditor must state in his report on the company’s annual accounts whether |
| |
in his opinion the information given in the directors’ report for the financial |
| |
year for which the accounts are prepared is consistent with those accounts. |
| |
487 | Auditor’s report on auditable part of directors’ remuneration report |
| |
(1) | If the company is a quoted company, the auditor, in his report on the |
| 35 |
company’s annual accounts for the financial year, must— |
| |
(a) | report to the company’s members on the auditable part of the directors’ |
| |
| |
(b) | state whether in his opinion that part of the directors’ remuneration |
| |
report has been properly prepared in accordance with this Act. |
| 40 |
(2) | For the purposes of this Part, “the auditable part” of a directors’ remuneration |
| |
report is the part identified as such by regulations under section 403. |
| |
|
| |
|
| |
|
Duties and rights of auditors |
| |
| |
(1) | A company’s auditor, in preparing his report, must carry out such |
| |
investigations as will enable him to form an opinion as to— |
| |
(a) | whether adequate accounting records have been kept by the company |
| 5 |
and returns adequate for their audit have been received from branches |
| |
| |
(b) | whether the company’s individual accounts are in agreement with the |
| |
accounting records and returns, and |
| |
(c) | in the case of a quoted company, whether the auditable part of the |
| 10 |
company’s directors’ remuneration report is in agreement with the |
| |
accounting records and returns. |
| |
(2) | If the auditor is of opinion— |
| |
(a) | that adequate accounting records have not been kept, or that returns |
| |
adequate for their audit have not been received from branches not |
| 15 |
| |
(b) | that the company’s individual accounts are not in agreement with the |
| |
accounting records and returns, or |
| |
(c) | in the case of a quoted company, that the auditable part of its directors’ |
| |
remuneration report is not in agreement with the accounting records |
| 20 |
| |
| the auditor shall state that fact in his report. |
| |
(3) | If the auditor fails to obtain all the information and explanations which, to the |
| |
best of his knowledge and belief, are necessary for the purposes of his audit, he |
| |
shall state that fact in his report. |
| 25 |
| |
(a) | the requirements of regulations under section 394 (disclosure of |
| |
directors’ benefits: remuneration, pensions and compensation for loss |
| |
of office) are not complied with in the annual accounts, or |
| |
(b) | in the case of a quoted company, the requirements of regulations under |
| 30 |
section 403 as to information forming the auditable part of the |
| |
directors’ remuneration report are not complied with in that report, |
| |
| the auditor must include in his report, so far as he is reasonably able to do so, |
| |
a statement giving the required particulars. |
| |
(5) | If the directors of the company have prepared accounts and reports in |
| 35 |
accordance with the small companies regime and in the auditor’s opinion they |
| |
were not entitled so to do, the auditor shall state that fact in his report. |
| |
489 | Auditor’s general right to information |
| |
(1) | An auditor of a company— |
| |
(a) | has a right of access at all times to the company’s books, accounts and |
| 40 |
vouchers (in whatever form they are held), and |
| |
(b) | may require any of the following persons to provide him with such |
| |
information or explanations as he thinks necessary for the performance |
| |
of his duties as auditor. |
| |
| 45 |
|
| |
|
| |
|
(a) | any officer or employee of the company; |
| |
(b) | any person holding or accountable for any of the company’s books, |
| |
| |
(c) | any subsidiary undertaking of the company which is a body corporate |
| |
incorporated in the United Kingdom; |
| 5 |
(d) | any officer, employee or auditor of any such subsidiary undertaking or |
| |
any person holding or accountable for any books, accounts or vouchers |
| |
of any such subsidiary undertaking; |
| |
(e) | any person who fell within any of paragraphs (a) to (d) at a time to |
| |
which the information or explanations required by the auditor relates |
| 10 |
| |
(3) | A statement made by a person in response to a requirement under this section |
| |
may not be used in evidence against him in criminal proceedings except |
| |
proceedings for an offence under section 491. |
| |
(4) | Nothing in this section compels a person to disclose information in respect of |
| 15 |
which a claim to legal professional privilege (in Scotland, to confidentiality of |
| |
communications) could be maintained in legal proceedings. |
| |
490 | Auditor’s right to information from overseas subsidiaries |
| |
(1) | Where a parent company has a subsidiary undertaking that is not a body |
| |
corporate incorporated in the United Kingdom, the auditor of the parent |
| 20 |
company may require it to obtain from any of the following persons such |
| |
information or explanations as he may reasonably require for the purposes of |
| |
| |
| |
| 25 |
(b) | any officer, employee or auditor of the undertaking; |
| |
(c) | any person holding or accountable for any of the undertaking’s books, |
| |
| |
(d) | any person who fell within paragraph (b) or (c) at a time to which the |
| |
information or explanations relates or relate. |
| 30 |
(3) | If so required, the parent company must take all such steps as are reasonably |
| |
open to it to obtain the information or explanations from the person concerned. |
| |
(4) | A statement made by a person in response to a requirement under this section |
| |
may not be used in evidence against him in criminal proceedings except |
| |
proceedings for an offence under section 491. |
| 35 |
(5) | Nothing in this section compels a person to disclose information in respect of |
| |
which a claim to legal professional privilege (in Scotland, to confidentiality of |
| |
communications) could be maintained in legal proceedings. |
| |
491 | Auditor’s rights to information: offences |
| |
(1) | A person commits an offence who knowingly or recklessly makes to an auditor |
| 40 |
of a company a statement (oral or written) that— |
| |
(a) | conveys or purports to convey any information or explanations which |
| |
the auditor requires, or is entitled to require, under section 489, and |
| |
(b) | is misleading, false or deceptive in a material particular. |
| |
|
| |
|
| |
|
(2) | A person guilty of an offence under subsection (1) 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 |
| 5 |
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 |
| |
| 10 |
(3) | A person who fails to comply with a requirement under section 489 without |
| |
delay commits an offence unless it was not reasonably practicable for him to |
| |
provide the required information or explanations. |
| |
(4) | If a parent company fails to comply with section 490, an offence is committed |
| |
| 15 |
| |
(b) | every officer of the company who is in default. |
| |
(5) | A person guilty of an offence under subsection (3) or (4) is liable on summary |
| |
conviction to a fine not exceeding level 3 on the standard scale. |
| |
(6) | Nothing in this section affects any right of an auditor to apply for an injunction |
| 20 |
(in Scotland, an interdict or an order for specific performance) to enforce any |
| |
of his rights under section 489 or 490. |
| |
492 | Auditor’s rights in relation to resolutions and meetings |
| |
(1) | In relation to a written resolution proposed to be agreed to by a private |
| |
company, the company’s auditor is entitled to receive all such communications |
| 25 |
relating to the resolution as, by virtue of any provision of Chapter 2 of Part 13 |
| |
of this Act, are required to be supplied to a member of the company. |
| |
(2) | A company’s auditor is entitled— |
| |
(a) | to receive all notices of, and other communications relating to, any |
| |
general meeting which a member of the company is entitled to receive, |
| 30 |
(b) | to attend any general meeting of the company, and |
| |
(c) | to be heard at any general meeting which he attends on any part of the |
| |
business of the meeting which concerns him as auditor. |
| |
(3) | Where the auditor is a firm, the right to attend or be heard at a meeting is |
| |
exercisable by an individual authorised by the firm in writing to act as its |
| 35 |
representative at the meeting. |
| |
Signature of auditor’s report |
| |
493 | Signature of auditor’s report |
| |
(1) | The auditor’s report must state the name of the auditor and be signed and |
| |
| 40 |
(2) | Where the auditor is an individual, the report must be signed by him. |
| |
|
| |
|
| |
|
(3) | Where the auditor is a firm, the report must be signed by the senior statutory |
| |
auditor in his own name, for and on behalf of the auditor. |
| |
494 | Senior statutory auditor |
| |
(1) | The senior statutory auditor means the individual identified by the firm as |
| |
senior statutory auditor in relation to the audit in accordance with— |
| 5 |
(a) | standards issued by the European Commission, or |
| |
(b) | if there is no applicable standard so issued, any relevant guidance |
| |
| |
(i) | the Secretary of State, or |
| |
(ii) | a body appointed by order of the Secretary of State. |
| 10 |
(2) | The person identified as senior statutory auditor must be eligible for |
| |
appointment as auditor of the company in question (see Chapter 2 of Part 35 of |
| |
| |
(3) | The senior statutory auditor is not, by reason of being named or identified as |
| |
senior statutory auditor or by reason of his having signed the auditor’s report, |
| 15 |
subject to any civil liability to which he would not otherwise be subject. |
| |
(4) | An order appointing a body for the purpose of subsection (1)(b)(ii) is subject to |
| |
negative resolution procedure. |
| |
495 | Names to be stated in published copies of auditor’s report |
| |
(1) | Every copy of the auditor’s report that is published by or on behalf of the |
| 20 |
| |
(a) | state the name of the auditor and (where the auditor is a firm) the name |
| |
of the person who signed it as senior statutory auditor, or |
| |
(b) | if the conditions in section 496 (circumstances in which names may be |
| |
omitted) are met, state that a resolution has been passed and notified to |
| 25 |
the Secretary of State in accordance with that section. |
| |
(2) | For the purposes of this section a company is regarded as publishing the report |
| |
if it publishes, issues or circulates it or otherwise makes it available for public |
| |
inspection in a manner calculated to invite members of the public generally, or |
| |
any class of members of the public, to read it. |
| 30 |
(3) | If a copy of the auditor’s report is published without the statement required by |
| |
this section, an offence is committed by— |
| |
| |
(b) | every officer of the company who is in default. |
| |
(4) | A person guilty of an offence under this section is liable on summary |
| 35 |
conviction to a fine not exceeding level 3 on the standard scale. |
| |
496 | Circumstances in which names may be omitted |
| |
(1) | The auditor’s name and, where the auditor is a firm, the name of the person |
| |
who signed the report as senior statutory auditor, may be omitted from— |
| |
(a) | published copies of the report, and |
| 40 |
(b) | the copy of the report delivered to the registrar under Chapter 10 of |
| |
Part 15 (filing of accounts and reports), |
| |
| if the following conditions are met. |
| |
|
| |
|