Accounts and Reports

Q. When will the new Act's requirements on accounts / reports come into effect?

A. Generally the requirements on the form and contents of accounts and reports in Part 15 of the Companies Act 2006, and the new regulations to be made under it, will be commenced with effect for accounts and reports beginning on or after 6 April 2008. Accounts and reports for periods beginning before then will continue to be prepared in accordance with the Companies Act 1985.

However, the new business review requirements in section 417 of the Companies Act 2006 will be commenced for reports for financial years beginning on or after 1 October 2007.

Q. Will certain companies still be able to file abbreviated accounts?

A. Yes.

Q. Will there be a change to the type of accounts we can file and the statements we have to use?

A.The accounts types will remain the same but the statements for companies with accounting periods starting on or after 6th April 2008 will be required to refer to the Companies Act 2006 statements (The new accounts statements).

Q. Will there be any changes to the accounts exemption thresholds?

A. Yes - the new accounts exemption thresholds.

Q. Will Limited Liability Partnerships be affected by the changes brought in by the CA 06?

A. Yes. Generally the requirements on the form and contents of LLP accounts and reports in Part 15 of the Companies Act 2006, (as applied by The Limited Liability Partnerships (Accounts and Audit)(Application of Companies Act 2006) Regulations 2008) and the new regulations to be made under it, will be commenced with effect for accounts and reports beginning on or after 1st October 2008.

Q. Will certain LLPs still be able to file abbreviated accounts?

A. Yes.

Q. Will there be a change to the type of LLP accounts we can file and the statements we have to use?

A. The accounts types will remain the same but the statements for LLPs with accounting periods starting on or after 1st October 2008 will be required to refer to the Companies Act 2006 statements (The new accounts statements).

These statements are applied to LLPs by the Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008.

Q. Will the special rules concerning the audit of small charitable companies remain in place?

A. For financial periods beginning on or after 1st April 2008 there are no longer special rules regarding audit exemption for charitable companies.  They can qualify for audit exemption under company law in the same way as any other company.  Charitable companies may also be subject to separate requirements for audit or other scrutiny of their accounts under charity law. For more information see www.charity-commission.gov.uk for charities registered in England or Wales or www.oscr.org.uk for charities registered in Scotland.

Q. Can LLPs take advantage of the higher small/medium thresholds?

A.Yes.  However the higher thresholds for qualifying as small or medium will only apply to LLPs with accounting periods starting on or after 1st October 2008.

Q. The software that we use (for small companies), in providing accounting services to our clients, refers to the Companies Act 1985 in a number of places in the accounting reports. Our understanding is that the Companies Act 1985 has been superseded and the valid act is the Companies Act 2006. Should our software therefore refer to the 2006 Act and not 1985?

A. The section of the Companies Act 2006 relating to the new requirements for accounts does not come into force until 6th April 2008, and will apply to accounting reference dates beginning on or after that date. Regulations for accounts contents are currently being drafted and are due to be finalised at the end of the year when further guidance will be issued on the statements required.

Q. Do we need to change the s249 statement in our accounts for the changes that come into force on October 2007?

A. No, changes to statements in accounts will only be necessary for accounting periods beginning on or after 6th April 2008, when the accounting provisions under the 2006 Act are implemented.

Q. What are the changes to the accounts filing dates?

A. The filing dates for accounts will be reduced from 10 months to 9 months for private companies and from 7 months to 6 months for PLCs.

Q. When will the reduction in the accounts filing dates be introduced?

A. The reduction in the accounts filing deadlines will be introduced for companies with accounting periods beginning on or after 6th April 2008.

Q. What changes will there be to our accounts?

A. Many of the changes to the accounts have yet to be defined, however for companies with accounting periods beginning 6th April 2008, the filing times for accounts will be shortened to 9 months for private companies and 6 months for public companies.

Q. When will the 10 months for filing our accounts be shortened to 9 months?

A. The shortened filing for accounts will come into force for companies with accounting periods beginning on or after 6th April 2008.

Q. What are the specific references in the 2006 Act that relate to the shortening of the accounts filing periods, and when are they effective from?

A. Section 442 'Period allowed for filing accounts', will commence on 6th April 2008. Therefore it will apply to all accounting periods that begin on or after 6th April 2008.

Q. Will the definition of 'participating interest' in section 260 of the Companies Act 1985 be re-enacted in secondary legislation relating to accounting?

A. Yes. We will restate section 260 CA1985 without modification in the regulations to be made under Part 15 of the CA 2006.

Q. Do the new provisions relating to false or misleading statements in reports apply to accounts after 20 January, or if the accounting year starts before 20 January, not apply until the issue of the accounts?

A. Section 463 of the Companies Act 2006 (liability for false or misleading statements in reports) does not apply to a directors' report, directors' remuneration report or summary financial statement first sent to members and others under section 238 or 251 of the 1985 Act, or Article 246 or 259 of the 1986 Order, before January 2007. So it depends when documents are sent to members, not which financial year they apply to.

Q. What is a Business Review?

A. A Business Review is a fair review of the company's business within the reporting period. It must be a balanced and comprehensive analysis of the development and performance of the company, with a description of the principal risks. (See Section 417 of the Companies Act 2006).

Q. Who does this apply to?

A. The Directors Report in the accounts must contain a Business Review. This applies to all companies, except companies that file small company accounts.

Q. When does this come into force?

A. The Business Review will apply to all accounts with reporting periods beginning on or after 1st October 2007.

Q. What are the most common rejection reasons for accounts?

A. Please select the following link for information about accounts rejections 'account rejections notice (PDF 208KB)'