Company Law Reform Bill [HL] (206-210)

House of Commons

Session 2005 - 06
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Other Bills before Parliament

Company Law Reform Bill [HL] (206-210)

Company Law Reform Bill [HL] (changed to Companies Bill [HL])
Part 16 — Accounts and reports
Chapter 7 — Publication of accounts and reports
206

(c)
the auditor’s report on those accounts (including the statement on that
report).
(2)
The entitlement under this section is to a single copy of those documents, but
that is in addition to any copy to which a person may be entitled under section
429.
5
(3)
If a demand made under this section is not complied with within seven days of
receipt by the company, an offence is committed by—
(a)
the company, and
(b)
every officer of the company who is in default.
(4)
A person guilty of an offence under this section is liable on summary
10
conviction to a fine not exceeding level 3 on the standard scale and, for
continued contravention, a daily default fine not exceeding one-tenth of level
3 on the standard scale.
440
Right of member or debenture holder to copies of accounts and reports:
quoted companies
15
(1)
A member of, or holder of debentures of, a quoted company is entitled to be
provided, on demand and without charge, with a copy of—
(a)
the company’s last annual accounts,
(b)
the last directors’ remuneration report,
(c)
the last directors’ report, and
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(d)
the auditor’s report on those accounts (including the report on the
directors’ remuneration report and on the directors’ report).
(2)
The entitlement under this section is to a single copy of those documents, but
that is in addition to any copy to which a person may be entitled under section
429.
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(3)
If a demand made under this section is not complied with within seven days of
receipt by the company, an offence is committed by—
(a)
the company, and
(b)
every officer of the company who is in default.
(4)
A person guilty of an offence under this section is liable on summary
30
conviction to a fine not exceeding level 3 on the standard scale and, for
continued contravention, a daily default fine not exceeding one-tenth of level
3 on the standard scale.
Requirements in connection with publication of accounts and reports
441
Name of signatory to be stated in published copies of accounts and reports
35
(1)
Every copy of a document to which this section applies that is published by or
on behalf of the company must state the name of the person who signed it on
behalf of the board.
(2)
In the case of an unquoted company, this section applies to copies of—
(a)
the company’s balance sheet, and
40
(b)
the directors’ report.
(3)
In the case of a quoted company, this section applies to copies of—

Company Law Reform Bill [HL] (changed to Companies Bill [HL])
Part 16 — Accounts and reports
Chapter 7 — Publication of accounts and reports
207

(a)
the company’s balance sheet,
(b)
the directors’ remuneration report, and
(c)
the directors’ report.
(4)
If a copy is published without the required statement of the signatory’s name,
an offence is committed by—
5
(a)
the company, and
(b)
every officer of the company who is in default.
(5)
A person guilty of an offence under this section is liable on summary
conviction to a fine not exceeding level 3 on the standard scale.
442
Requirements in connection with publication of statutory accounts
10
(1)
If a company publishes any of its statutory accounts, they must be
accompanied by—
(a)
the auditor’s report on those accounts (unless the company is exempt
from audit and the directors have taken advantage of that exemption),
or
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(b)
where the company is exempt from audit by virtue of section 490
(charity: independent examiner’s report in lieu of audit) and the
directors take advantage of that exemption, the report made for the
purposes of that section.
(2)
A company that prepares statutory group accounts for a financial year must
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not publish its statutory individual accounts for that year without also
publishing with them its statutory group accounts.
(3)
A company’s “statutory accounts” are its accounts for a financial year as
required to be delivered to the registrar under section 449.
(4)
If a company contravenes any provision of this section, an offence is committed
25
by—
(a)
the company, and
(b)
every officer of the company who is in default.
(5)
A person guilty of an offence under this section is liable on summary
conviction to a fine not exceeding level 3 on the standard scale.
30
(6)
This section does not apply in relation to the provision by a company of a
summary financial statement (see section 432).
443
Requirements in connection with publication of non-statutory accounts
(1)
If a company publishes non-statutory accounts, it must publish with them a
statement indicating—
35
(a)
that they are not the company’s statutory accounts,
(b)
whether statutory accounts dealing with any financial year with which
the non-statutory accounts purport to deal have been delivered to the
registrar,
(c)
whether an auditor’s report has been made on the company’s statutory
40
accounts for any such financial year, and if so whether the report—
(i)
was qualified or unqualified, or included a reference to any
matters to which the auditor drew attention by way of emphasis
without qualifying the report, or

Company Law Reform Bill [HL] (changed to Companies Bill [HL])
Part 16 — Accounts and reports
Chapter 7 — Publication of accounts and reports
208

(ii)
contained a statement under section 512(2) (accounting records
or returns inadequate or accounts or directors’ remuneration
report not agreeing with records and returns), or section 512(3)
(failure to obtain necessary information and explanations); and
(d)
whether any report has been made on the company’s statutory
5
accounts for any such financial year for the purposes of section 490
(small charities: independent examiner’s report in lieu of audit), and if
so whether that report was qualified.
(2)
The company must not publish with non-statutory accounts—
(a)
the auditor’s report on the company’s statutory accounts, or
10
(b)
where the company is exempt from audit under section 490, any report
made for the purposes of that section.
(3)
References in this section to the publication by a company of “non-statutory
accounts” are to the publication of—
(a)
any balance sheet or profit and loss account relating to, or purporting
15
to deal with, a financial year of the company, or
(b)
an account in any form purporting to be a balance sheet or profit and
loss account for a group headed by the company relating to, or
purporting to deal with, a financial year of the company,

otherwise than as part of the company’s statutory accounts.
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(4)
In subsection (3)(b) “a group headed by the company” means a group
consisting of the company and any other undertaking (regardless of whether it
is a subsidiary undertaking of the company) other than a parent undertaking
of the company.
(5)
If a company contravenes any provision of this section, an offence is committed
25
by—
(a)
the company, and
(b)
every officer of the company who is in default.
(6)
A person guilty of an offence under this section is liable on summary
conviction to a fine not exceeding level 3 on the standard scale.
30
(7)
This section does not apply in relation to the provision by a company of a
summary financial statement (see section 432).
444
Meaning of “publication” in relation to accounts and reports
(1)
This section has effect for the purposes of—
section 441 (name of signatory to be stated in published copies of accounts
35
and reports),
section 442 (requirements in connection with publication of statutory
accounts), and
section 443 (requirements in connection with publication of non-statutory
accounts).
40
(2)
For the purposes of those sections a company is regarded as publishing a
document 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.

Company Law Reform Bill [HL] (changed to Companies Bill [HL])
Part 16 — Accounts and reports
Chapter 9 — Quoted companies: members’ approval of directors’ remuneration report
209

Chapter 8
Public companies: laying of accounts and reports before general meeting
445
Public companies: laying of accounts and reports before general meeting
(1)
The directors of a public company must lay before the company in general
meeting copies of its annual accounts and reports.
5
(2)
This section must be complied with not later than the end of the period for
filing the accounts and reports in question.
(3)
In the Companies Acts “accounts meeting”, in relation to a public company,
means a general meeting of the company at which the company’s annual
accounts and reports are (or are to be) laid in accordance with this section.
10
446
Public companies: offence of failure to lay accounts and reports
(1)
If the requirements of section 445 (public companies: laying of accounts and
reports before general meeting) are not complied with before the end of the
period allowed, every person who immediately before the end of that period
was a director of the company commits an offence.
15
(2)
It is a defence for a person charged with such an offence to prove that he took
all reasonable steps for securing that those requirements would be complied
with before the end of that period.
(3)
It is not a defence to prove that the documents in question were not in fact
prepared as required by this Part.
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(4)
A person guilty of an offence under this section is liable on summary
conviction to a fine not exceeding level 5 on the standard scale and, for
continued contravention, a daily default fine not exceeding one-tenth of level
5 on the standard scale.
Chapter 9
25
Quoted companies: members’ approval of directors’ remuneration report
447
Quoted companies: members’ approval of directors’ remuneration report
(1)
A quoted company must, prior to the accounts meeting, give to the members
of the company entitled to be sent notice of the meeting notice of the intention
to move at the meeting, as an ordinary resolution, a resolution approving the
30
directors’ remuneration report for the financial year.
(2)
The notice may be given in any manner permitted for the service on the
member of notice of the meeting.
(3)
The business that may be dealt with at the accounts meeting includes the
resolution.
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This is so notwithstanding any default in complying with subsection (1) or (2).
(4)
The existing directors must ensure that the resolution is put to the vote of the
meeting.

Company Law Reform Bill [HL] (changed to Companies Bill [HL])
Part 16 — Accounts and reports
Chapter 10 — Filing of accounts and reports
210

(5)
No entitlement of a person to remuneration is made conditional on the
resolution being passed by reason only of the provision made by this section.
(6)
In this section—
“the accounts meeting” means the general meeting of the company before
which the company’s annual accounts for the financial year are to be
5
laid; and
“existing director” means a person who is a director of the company
immediately before that meeting.
448
Quoted companies: offences in connection with procedure for approval
(1)
In the event of default in complying with section 447(1) (notice to be given of
10
resolution for approval of directors’ remuneration report), an offence is
committed by every officer of the company who is in default.
(2)
If the resolution is not put to the vote of the accounts meeting, an offence is
committed by each existing director.
(3)
It is a defence for a person charged with an offence under subsection (2) to
15
prove that he took all reasonable steps for securing that the resolution was put
to the vote of the meeting.
(4)
A person guilty of an offence under this section is liable on summary
conviction to a fine not exceeding level 3 on the standard scale.
(5)
In this section—
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“the accounts meeting” means the general meeting of the company before
which the company’s annual accounts for the financial year are to be
laid; and
“existing director” means a person who is a director of the company
immediately before that meeting.
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Chapter 10
Filing of accounts and reports
Duty to file accounts and reports
449
Duty to file accounts and reports with the registrar
(1)
The directors of a company must deliver to the registrar for each financial year
30
the accounts and reports required by—
section 452 (filing obligations of companies subject to small companies
regime),
section 453 (filing obligations of medium-sized companies),
section 454 (filing obligations of unquoted companies), or
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section 455 (filing obligations of quoted companies).
(2)
This is subject to section 456 (unlimited companies exempt from filing
obligations).