|
| |
|
that need to be brought to the attention of members or creditors of the |
| |
| |
(2) | If he considers that there are no circumstances in connection with his ceasing |
| |
to hold office that need to be brought to the attention of members or creditors |
| |
of the company, he must deposit at the company’s registered office a statement |
| 5 |
| |
(3) | Where an auditor of a quoted company ceases for any reason to hold office, he |
| |
must deposit at the company’s registered office a statement of the |
| |
circumstances connected with his ceasing to hold office. |
| |
(4) | The statement required by this section must be deposited— |
| 10 |
(a) | in the case of resignation, along with the notice of resignation; |
| |
(b) | in the case of failure to seek re-appointment, not less than 14 days |
| |
before the end of the time allowed for next appointing an auditor; |
| |
(c) | in any other case, not later than the end of the period of 14 days |
| |
beginning with the date on which he ceases to hold office. |
| 15 |
(5) | A person ceasing to hold office as auditor who fails to comply with this section |
| |
| |
(6) | In proceedings for such an offence it is a defence for the person charged to |
| |
show that he took all reasonable steps and exercised all due diligence to avoid |
| |
the commission of the offence. |
| 20 |
(7) | A person guilty of an offence under this section is liable— |
| |
(a) | on conviction on indictment, to a fine; |
| |
(b) | on summary conviction, to a fine not exceeding the statutory |
| |
| |
510 | Company’s duties in relation to statement |
| 25 |
(1) | This section applies where the statement deposited under section 509 states the |
| |
circumstances connected with the auditor’s ceasing to hold office. |
| |
(2) | The company must within 14 days of the deposit of the statement either— |
| |
(a) | send a copy of it to every person who under section 405 is entitled to be |
| |
sent copies of the accounts, or |
| 30 |
| |
(3) | If it applies to the court, the company must notify the auditor of the |
| |
| |
(4) | If the court is satisfied that the auditor is using the provisions of section 509 to |
| |
secure needless publicity for defamatory matter— |
| 35 |
(a) | it shall direct that copies of the statement need not be sent out, and |
| |
(b) | it may further order the company’s costs (in Scotland, expenses) on the |
| |
application to be paid in whole or in part by the auditor, even if he is |
| |
not a party to the application. |
| |
| The company must within 14 days of the court’s decision send to the persons |
| 40 |
mentioned in subsection (2)(a) a statement setting out the effect of the order. |
| |
(5) | If no such direction is made the company must send copies of the statement to |
| |
the persons mentioned in subsection (2)(a) within 14 days of the court’s |
| |
decision or, as the case may be, of the discontinuance of the proceedings. |
| |
|
| |
|
| |
|
(6) | In the event of default in complying with this section an offence is committed |
| |
by every officer of the company who is in default. |
| |
(7) | In proceedings for such an offence it is a defence for the person charged to |
| |
show that he took all reasonable steps and exercised all due diligence to avoid |
| |
the commission of the offence. |
| 5 |
(8) | A person guilty of an offence under this section is liable— |
| |
(a) | on conviction on indictment, to a fine; |
| |
(b) | on summary conviction, to a fine not exceeding the statutory |
| |
| |
511 | Copy of statement to be sent to registrar |
| 10 |
(1) | Unless within 21 days beginning with the day on which he deposited the |
| |
statement under section 509 the auditor receives notice of an application to the |
| |
court under section 510, he must within a further seven days send a copy of the |
| |
statement to the registrar. |
| |
(2) | If an application to the court is made under section 510 and the auditor |
| 15 |
subsequently receives notice under subsection (5) of that section, he must |
| |
within seven days of receiving the notice send a copy of the statement to the |
| |
| |
(3) | An auditor who fails to comply with subsection (1) or (2) commits an offence. |
| |
(4) | In proceedings for such an offence it is a defence for the person charged to |
| 20 |
show that he took all reasonable steps and exercised all due diligence to avoid |
| |
the commission of the offence. |
| |
(5) | A person guilty of an offence under this section is liable— |
| |
(a) | on conviction on indictment, to a fine; |
| |
(b) | on summary conviction, to a fine not exceeding the statutory |
| 25 |
| |
512 | Duty of auditor to notify appropriate audit authority |
| |
| |
(a) | in the case of a major audit, an auditor ceases for any reason to hold |
| |
| 30 |
(b) | in the case of an audit that is not a major audit, an auditor ceases to hold |
| |
office before the end of his term of office, |
| |
| the auditor ceasing to hold office must notify the appropriate audit authority. |
| |
| |
(a) | inform the appropriate audit authority that he has ceased to hold office, |
| 35 |
| |
(b) | be accompanied by a copy of the statement deposited by him at the |
| |
company’s registered office in accordance with section 509. |
| |
(3) | If the statement so deposited is to the effect that he considers that there are no |
| |
circumstances in connection with his ceasing to hold office that need to be |
| 40 |
brought to the attention of members or creditors of the company, the notice |
| |
must also be accompanied by a statement of the reasons for his ceasing to hold |
| |
| |
|
| |
|
| |
|
(4) | The auditor must comply with this section— |
| |
(a) | in the case of a major audit, at the same time as he deposits a statement |
| |
at the company’s registered office in accordance with section 509; |
| |
(b) | in the case of an audit that is not a major audit, at such time (not being |
| |
earlier than the time mentioned in paragraph (a)) as the appropriate |
| 5 |
audit authority may require. |
| |
(5) | A person ceasing to hold office as auditor who fails to comply with this section |
| |
| |
(6) | If that person is a firm an offence is committed by— |
| |
| 10 |
(b) | every officer of the firm who is in default. |
| |
(7) | In proceedings for an offence under this section it is a defence for the person |
| |
charged to show that he took all reasonable steps and exercised all due |
| |
diligence to avoid the commission of the offence. |
| |
(8) | A person guilty of an offence under this section is liable— |
| 15 |
(a) | on conviction on indictment, to a fine; |
| |
(b) | on summary conviction, to a fine not exceeding the statutory |
| |
| |
513 | Duty of company to notify appropriate audit authority |
| |
(1) | Where an auditor ceases to hold office before the end of his term of office, the |
| 20 |
company must notify the appropriate audit authority. |
| |
| |
(a) | inform the appropriate audit authority that the auditor has ceased to |
| |
| |
| 25 |
(i) | a statement by the company of the reasons for his ceasing to |
| |
| |
(ii) | if the copy of the statement deposited by the auditor at the |
| |
company’s registered office in accordance with section 509 |
| |
contains a statement of circumstances in connection with his |
| 30 |
ceasing to hold office that need to be brought to the attention of |
| |
members or creditors of the company, a copy of that statement. |
| |
(3) | The company must give notice under this section not later than 14 days after |
| |
the date on which the auditor’s statement is deposited at the company’s |
| |
registered office in accordance with section 509. |
| 35 |
(4) | If a company fails to comply with this section, an offence is committed by— |
| |
| |
(b) | every officer of the company who is in default. |
| |
(5) | In proceedings for such an offence it is a defence for the person charged to |
| |
show that he took all reasonable steps and exercised all due diligence to avoid |
| 40 |
the commission of the offence. |
| |
(6) | A person guilty of an offence under this section is liable— |
| |
(a) | on conviction on indictment, to a fine; |
| |
(b) | on summary conviction, to a fine not exceeding the statutory |
| |
| 45 |
|
| |
|
| |
|
514 | Information to be given to accounting authorities |
| |
(1) | The appropriate audit authority on receiving notice under section 512 or 513 of |
| |
an auditor’s ceasing to hold office— |
| |
(a) | must inform the accounting authorities, and |
| |
(b) | may if it thinks fit forward to those authorities a copy of the statement |
| 5 |
or statements accompanying the notice. |
| |
(2) | The accounting authorities are— |
| |
(a) | the Secretary of State, and |
| |
(b) | any person authorised by the Secretary of State for the purposes of |
| |
section 440 (revision of defective accounts: persons authorised to apply |
| 10 |
| |
(3) | If either of the accounting authorities is also the appropriate audit authority it |
| |
is only necessary to comply with this section as regards any other accounting |
| |
| |
(4) | If the court has made an order under section 510(4) directing that copies of the |
| 15 |
statement need not be sent out by the company, sections 444 and 445 |
| |
(restriction on further disclosure) apply in relation to the copies sent to the |
| |
accounting authorities as they apply to information obtained under section 443 |
| |
(power to require documents etc). |
| |
515 | Meaning of “appropriate audit authority” and “major audit” |
| 20 |
(1) | In sections 512, 513 and 514 “appropriate audit authority” means— |
| |
(a) | in the case of a major audit, the Secretary of State or the body to whom |
| |
the Secretary of State has delegated functions under section 881 or 882 |
| |
| |
(b) | in the case of an audit that is not a major audit, the relevant supervisory |
| 25 |
| |
(2) | In sections 512 and this section “major audit” means a statutory audit |
| |
| |
(a) | a company any of whose securities have been admitted to the official |
| |
list (within the meaning of Part 6 of the Financial Services and Markets |
| 30 |
| |
(b) | any other person in whose financial condition there is a major public |
| |
| |
(3) | In determining whether an audit is a major audit within subsection (2)(b), |
| |
regard shall be had to any guidance issued by any of the authorities mentioned |
| 35 |
| |
| |
516 | Effect of casual vacancies |
| |
| If an auditor ceases to hold office for any reason, any surviving or continuing |
| |
auditor or auditors may continue to act. |
| 40 |
|
| |
|
| |
|
| |
Quoted companies: right of members to raise audit concerns at accounts |
| |
| |
517 | Members’ power to require website publication of audit concerns |
| |
(1) | The members of a quoted company may require the company to publish on a |
| 5 |
website a statement setting out any matter relating to— |
| |
(a) | the audit of the company’s accounts (including the auditor’s report and |
| |
the conduct of the audit) that are to be laid before the next accounts |
| |
| |
(b) | any circumstances connected with an auditor of the company ceasing |
| 10 |
to hold office since the previous accounts meeting, |
| |
| that the members propose to raise at the next accounts meeting of the |
| |
| |
(2) | A company is required to do so once it has received requests to that effect |
| |
| 15 |
(a) | members representing at least 5% of the total voting rights of all the |
| |
members who have a relevant right to vote (excluding any voting rights |
| |
attached to any shares in the company held as treasury shares), or |
| |
(b) | at least 100 members who have a relevant right to vote and hold shares |
| |
in the company on which there has been paid up an average sum, per |
| 20 |
member, of at least £100. |
| |
(3) | In subsection (2) a “relevant right to vote” means a right to vote at the accounts |
| |
| |
| |
(a) | may be sent to the company in hard copy or electronic form, |
| 25 |
(b) | must identify the statement to which it relates, |
| |
(c) | must be authenticated by the person or persons making it, and |
| |
(d) | must be received by the company at least one week before the meeting |
| |
| |
(5) | A quoted company is not required to place on a website a statement under this |
| 30 |
section if, on an application by the company or another person who claims to |
| |
be aggrieved, the court is satisfied that the rights conferred by this section are |
| |
| |
(6) | The court may order the members requesting website publication to pay the |
| |
whole or part of the company’s costs (in Scotland, expenses) on such an |
| 35 |
application, even if they are not parties to the application. |
| |
518 | Requirements as to website availability |
| |
(1) | The following provisions apply for the purposes of section 517 (website |
| |
publication of members’ statement of audit concerns). |
| |
(2) | The information must be made available on a website that— |
| 40 |
(a) | is maintained by or on behalf of the company, and |
| |
(b) | identifies the company in question. |
| |
|
| |
|
| |
|
(3) | Access to the information on the website, and the ability to obtain a hard copy |
| |
of the information from the website, must not be conditional on the payment |
| |
of a fee or otherwise restricted. |
| |
| |
(a) | must be made available within three working days of the company |
| 5 |
being required to publish it on a website, and |
| |
(b) | must be kept available until after the meeting to which it relates. |
| |
(5) | A failure to make information available on a website throughout the period |
| |
specified in subsection (4)(b) is disregarded if— |
| |
(a) | the information is made available on the website for part of that period, |
| 10 |
| |
(b) | the failure is wholly attributable to circumstances that it would not be |
| |
reasonable to have expected the company to prevent or avoid. |
| |
519 | Website publication: company’s supplementary duties |
| |
(1) | A quoted company must in the notice it gives of the accounts meeting draw |
| 15 |
| |
(a) | the possibility of a statement being placed on a website in pursuance of |
| |
members’ requests under section 517, and |
| |
(b) | the effect of the following provisions of this section. |
| |
(2) | A company may not require the members requesting website publication to |
| 20 |
pay its expenses in complying with that section or section 518 (requirements in |
| |
connection with website publication). |
| |
(3) | Where a company is required to place a statement on a website under section |
| |
517 it must forward the statement to the company’s auditor not later than the |
| |
time when it makes the statement available on the website. |
| 25 |
(4) | The business which may be dealt with at the accounts meeting includes any |
| |
statement that the company has been required under section 517 to publish on |
| |
| |
520 | Website publication: offences |
| |
(1) | In the event of default in complying with |
| 30 |
(a) | section 518 (requirements as to website publication), or |
| |
(b) | section 519 (companies’ supplementary duties in relation to request for |
| |
| |
| an offence is committed by every officer of the company who is in default. |
| |
(2) | A person guilty of an offence under this section is liable— |
| 35 |
(a) | on conviction on indictment, to a fine; |
| |
(b) | on summary conviction, to a fine not exceeding the statutory |
| |
| |
521 | Meaning of “quoted company” |
| |
(1) | For the purposes of this Chapter a company is a quoted company if it is a |
| 40 |
quoted company in accordance with section 367 (quoted and unquoted |
| |
companies for the purposes of Part 15) in relation to the financial year to which |
| |
the accounts to be laid at the next accounts meeting relate. |
| |
|
| |
|
| |
|
(2) | The provisions of subsections (4) to (6) of that section (power to amend |
| |
definition by regulations) apply in relation to the provisions of this Chapter as |
| |
in relation to the provisions of that Part. |
| |
| |
| 5 |
Voidness of provisions protecting auditors from liability |
| |
522 | Voidness of provisions protecting auditors from liability |
| |
(1) | This section applies to any provision— |
| |
(a) | for exempting an auditor of a company (to any extent) from any |
| |
liability that would otherwise attach to him in connection with any |
| 10 |
negligence, default, breach of duty or breach of trust in relation to the |
| |
company occurring in the course of the audit of accounts, or |
| |
(b) | by which a company directly or indirectly provides an indemnity (to |
| |
any extent) for an auditor of the company, or of an associated company, |
| |
against any liability attaching to him in connection with any |
| 15 |
negligence, default, breach of duty or breach of trust in relation to the |
| |
company of which he is auditor occurring in the course of the audit of |
| |
| |
(2) | Any such provision is void, except as permitted by— |
| |
(a) | section 523 (indemnity for costs of successfully defending |
| 20 |
| |
(b) | sections 524 to 526 (liability limitation agreements). |
| |
(3) | This section applies to any provision, whether contained in a company’s |
| |
articles or in any contract with the company or otherwise. |
| |
(4) | For the purposes of this section companies are associated if one is a subsidiary |
| 25 |
of the other or both are subsidiaries of the same body corporate. |
| |
Indemnity for costs of defending proceedings |
| |
523 | Indemnity for costs of successfully defending proceedings |
| |
| Section 522 (general voidness of provisions protecting auditors from liability) |
| |
does not prevent a company from indemnifying an auditor against any liability |
| 30 |
| |
(a) | in defending proceedings (whether civil or criminal) in which |
| |
judgment is given in his favour or he is acquitted, or |
| |
(b) | in connection with an application under section 804 (power of court to |
| |
grant relief in case of honest and reasonable conduct) in which relief is |
| 35 |
granted to him by the court. |
| |
|
| |
|