Accounts and Accounting Reference Dates

Accounts and Accounting Reference Dates

The present note contains the general recommendations and should be considered in a combination to corresponding documents or consultations of the expert. In given article requirements on granting of financial reports for all companies with limited liability are resulted. Here two most important questions are considered: 

  • Basic date of drawing up of the reporting – in sum, this financial termination of year for any company, and also date on which the Registration chamber defines obligatory terms of granting of the financial reporting. The Registration chamber is necessary for notifying on change of this date in advance. If it not to make, that, probably, it is necessary to alter financial reports, registration of originals can be refused, and the company can incur additional expenses and penalties.
  • Preparation and giving of financial reports – the Registration chamber establishes a deadline to which the financial reporting of any company with limited liability should be prepared and given. For delay the penalty is automatically raised. Any expert should be completely informed on terms of giving of reports and accordingly plan the actions. As it was already told in the section devoted to directors and secretaries of the company if the expert supposes any infringements it does not remove from responsibility from the director.

Basic date of drawing up of the reporting

For the new company fiscal year begins with date of its registration. On all companies the requirement to make the annual financial report in which activity of the company within a year should be reflected extends. This period is called as fiscal year or the accounting period.

The first accounting period of the company

For just created company the first fiscal year automatically begins from last day month of its registration. For example, if the company is registered in November, 2000 its fiscal year pays off from date of registration till November, 30th, 2001. This date can vary for the term up to one week in this or that party.

Change of basic date of drawing up of the reporting

Basic date of drawing up of the reporting can be changed, having directed for this purpose the special form to Registration chamber, but this date should be declared to a deadline of giving of the reporting. For the private companies term between the termination of fiscal year and granting of the financial reporting in Registration chamber usually makes 10 months, and for the open companies with limited liability – 7 months. For the first year of carrying out of commercial operations this period pays off a little in another way.

The accounting period can be reduced at any time and to any necessary term, however on prolongation of the accounting period there are some restrictions:

  • It cannot last more than 18 months from the beginning of fiscal year;
  • It cannot last more than once in five years except for following cases:
    • The company is under the direction of the government, or
    • The company copes the minister, or
    • Fiscal year of the company should coincide with fiscal year of affiliated company or the company-founder founded and operating in the EU countries.

The companies registered abroad

If the company is registered abroad, but thus:

  • Has the branch registered in Great Britain and to which does not need to publish the reporting checked up by auditors in the country of the registration, or
  • The company has a registered office in Great Britain,

That on it all rules set forth above on basic date of drawing up of the reporting except that there are no restrictions on prolongation of the accounting period extend. For change of basic date of drawing up of the reporting the form 225 also is used.

On the company registered abroad and having registered branch in Great Britain which at the same time should give financial reports in the country of the registration, other rules extend.

Preparation and giving of the financial reporting

The rules containing in the present section, extend on all financial reports of the company, irrespective of the exceptions concerning their maintenance. ALL COMPANIES, BOTH With LIMITED, AND With UNLIMITED RESPONSIBILITY, SHOULD CONDUCT the FINANCIAL REPORTING IRRESPECTIVE OF, THEY are engaged in COMMERCIAL ACTIVITY OR NOT.

The financial reporting should include following documents:

  • The report on profits and losses (in it the profit and expenses / arrival and the expense is shown);
  • The balance report signed by the director;
  • The conclusion of the auditor signed by the auditor (if it is required);
  • The report of the director signed by the official of the company (the director or the secretary);
  • Notes to the reporting;
  • The summary report (if it is required).

The note:



If fiscal year has begun on January, 1st 2005 or later, the financial reporting can be prepared under the international standards of the account.



All companies with limited liability should direct financial reports to the registrar to Registration chamber. The certain category of the companies about which it will be told further, can give «the reduced reporting». The company with unlimited responsibility should prepare and submit the report during the accounting period only in the event that this company was or became:

  • Affiliated company or the founder of the enterprise with limited liability, or
  • The bank or insurance company (or the founder of such company), or
  • The company getting under qualification of associations and the companies with unlimited responsibility (Rules of granting of the financial reporting from 1993), or
  • To operate under the trade mark.

What period should be reflected in the financial reporting?



The first financial report of the company should be made for the period beginning from date of registration of the company, instead of from a date started of the first commercial operation. The period termination basic date of drawing up of the reporting which can vary for the term up to one week in this or that party is considered.



Each subsequent accounting period begins next day after a date closed of the previous period and comes to an end for basic date of drawing up of the reporting with possible shift till 7 days in this or that party.



Terms of giving of financial reports in Registration chamber

Following terms are usually supposed:

  • For the private companies with limited liability – ten months from a date closed of fiscal year;
  • For the open companies with limited liability (PLC) – seven months from a date closed of fiscal year.

If within a fiscal year the accounting period has been reduced, term of giving of reports will be more than ten/seven months (depending on company type) from a date closed of fiscal year, or three months from notice date.



If the first fiscal year lasted more than 12 months terms of giving of financial reports will be the following:

  • For the private companies – 22 months from date of registration or 3 months from the termination of fiscal year;
  • For PLC – 19 months from date of registration or 3 months from the termination of fiscal year.

It is necessary to notice that date of corresponding month has great value, that is the private company fiscal year at which comes to an end on September, 30th, should submit financial reports to Registration chamber not later than midnight on July, 30th, and 30, instead of on July, 31st will be considered last afternoon month. But, nevertheless, if fiscal year comes to an end on April, 30th, a closing date of giving of financial reports – on February, 28th next year as this month there is no corresponding date. In such cases the deadline considers last day month.

In what cases term of giving of reports can be prolonged?



If business of the company or its business interests develop abroad the company can make an application in Registration chamber under the special form 244 on prolongation of term of granting of financial reports for three months. This form should be submitted before the expiration of usual term of giving of financial reports, and further should move every year if within this year the extra time for granting of reports is required to the company. This procedure does not repeat automatically from year to year, it it is necessary to pass each time anew.



In special cases it is possible to make an application addressed to the minister of foreign trade and the industry with the request for prolongation of term of granting of the financial reporting, but for this purpose there should be a weighty reason, i.e. there should be special, unpredictable circumstances which cannot be checked the company or its experts. The demand should be submitted in written form, before the termination of usual term of giving of the reporting, and contain a detailed explanation of the reasons of a delay and time of prolongation of this term.

Delay of giving of reports



If financial reports are presented with delay the penalty for delay is automatically imposed on the company. The penalty sum depends on term of a delay and varies for the private companies and the open companies with limited liability (PLC).



Since February, 1st, 2009 the new system of penalties is entered.

Delay termThe private companyPLC
 1 day – 1 month£150£750
 1 month 1 day – 3 months£375£1500
 3 months 1 day – 6 months£750£3000
 More than 6 months£1500£7500

The delay of giving of financial reports also is considered penal action for which the director of the company can be involved in the criminal liability.

ATTENTION: If the deadline of giving of the reporting drops out on Sunday or the day off, under the law the report should be all the same submitted to this date, therefore in this case it is expedient to send reports so that they have been delivered to a deadline.

The statement/signing of financial reports

Financial reports affirm board of directors of the company and subscribe before their sending in Registration chamber.

The balance report should be signed the director, and any comments to the reporting or messages on change of terms of its giving should be above the signature of the director.

The report of the director should be signed the director or the secretary of the company. If any reports of bookkeepers, auditors, or special audit reports are applied on the report, in them the name and the address of the person or the company should be filled out, and to stand signatures.

After reception of documents by Registration chamber

All documents and the forms delivered in Registration chamber, are scanned, and their electronic copies are created. Originals of documents then are transferred in archive for storage, and their electronic copies are used as briefs.

If your business partners need to see company documents, they will work with their electronic copies online, therefore it is very important, that the original was high quality that it was possible to make a high-quality copy.

By preparation of documents:

  • Use black ink or a black font;
  • Letters should be fat enough (if font lines thin, the copy can turn out bad quality);
  • Do not direct the copies filled under a carbon paper;
  • Do not use the matrix printer;
  • It is necessary to remember that photocopies have a grey background, and it negatively affects quality of scanning;
  • Use a paper of format А4 with corresponding fields;
  • Specify company number on the first page in the right top corner.

Additional requirements to EU companies

EU company should submit «the Report of the company of EU» which goes to registration chamber together with annual financial reports.



Privileges for the small and average companies



What privileges exist?



The small and average companies can make financial reports under the special requirements resulted in sections 246 and 246А of the Law on the companies from 1985. Besides, they can make and submit to the registrar the reduced reports.



In the given section the privileges given to the small and average companies are resulted. The small companies with a turn less £5,6 million (£250 000 for the companies which are engaged in charity) and actives less £2,8 million can demand a privilege at audit carrying out.



What companies are considered small and average?



The open companies or some companies of adjustable sector cannot be considered small or average, as well as what are included into group of open-end companies or belonging to adjustable sector (except for exceptional circumstances – item 4 see). For other companies their size (or in case of the company-founder – the size it of group of the companies) which the turn is meant, a balance result (i.e. a total sum of long-term assets and circulating assets) and the average of workers, defines company classification as small or average.



Further exact conditions of classification of the companies as small or average are resulted.

That the company was considered small, it is necessary, that two of following conditions were carried out at least:

  • Annual turnover no more £5,6 million;
  • Balance result no more £2,8 million;
  • Average of workers no more than 50 persons.

That the company was considered as average, it is necessary, that two of following conditions were carried out at least:

  • Annual turnover no more £22,8 million;
  • Balance result no more £11,4 million;
  • Average of workers no more than 250 persons.

The company can be qualified as small or average if it corresponds to conditions following the results of the first fiscal year or any the subsequent. The company ceases to be considered small or average if these conditions are not observed within more than one year. If within next year the company again corresponds to the above-stated conditions it continues to be considered small or average, and this status does not interrupt.



The added requirements for the small and average companies on granting of the financial reporting in Registration chamber



The company can submit reports to Registration chamber, being guided by special positions of the Part 7 Laws on the companies from 1985, or it can submit the reduced variants of reports.



For the small companies the reduced variant of the report should include the short balance report with notes and a special audit report.



For the average companies the reduced variant of the report should include the reduced report on profits and the losses, the full balance report, a special audit report and notes to the financial reporting and the report of the director.



In a special audit report the statement that, according to the auditor, the company has the right to lean against positions s.246 (5) or s.246 A (3) Laws on the companies from 1985 according to circumstances should contain. Use of these positions should be declared in the financial reporting.



In the balance report (and also, if necessary, in the report of directors) should be specified that the financial reporting is prepared according to special positions of the Part 7 Laws on the companies from 1985, concerning to the small or average companies (to specify necessary).



What rules exist for the companies qualified as small or average, but at the same time entering into group in which the open companies or the companies belonging to adjustable sector are included?



There are certain exceptions for the small and average companies, whose fiscal year has begun on April, 1st 2005 года*.



The small companies can not include some information in the report of directors prepared for its shareholders, namely: the sum of dividends, the review of business operations, the information on market cost of the basic means if they considerably differ from the sums of the balance report, disclosure of some data, the information on quantity of workers. Also the small companies can to give the report of directors in Registration chamber.



The average companies can not include some data in the review of business operations entering into the report of directors, for example, the basic indicators of activity as they do not concern the financial information.



(* After introduction in action these positions have been changed to cover the financial reporting for the period beginning between 01.01.2005 – 01.04.2005 and coming to an end 01.10.2005 or later).



Whether there are special rules for small and average groups of the companies?



Yes, exist. The Company-founder does not need to prepare the financial reporting on group or to direct to its registrar if this group small or average, and any of the companies entering into this group, is not open-end company, or the company having the right according to the Part of 4 Laws on financial services and the markets from 2000 to conduct adjustable activity, or the company which is engaged in insurance.



That the group of the companies has been qualified as small, it should correspond at least to two of following conditions:

  • The cumulative turn should make no more £5,6 million in the pure state (£6,72 million total turn);
  • The cumulative total balance should make no more £2,8 million in the pure state (£3,36 million total sum);
  • Total number of workers should not exceed 50 persons.

Attention: the Above-stated restrictions operate in the event that the termination of fiscal year is necessary on 30.01.2004 or later. For groups of the companies, whose fiscal year has ended to this term, the following qualifying conditions operate, at least of which this group should correspond to two to be qualified as small:

  • The cumulative turn should make no more £2,8 million in the pure state (£3,36 million total turn);
  • The cumulative total balance should make no more £1,4 million in the pure state (£1,68 million total sum);
  • Total number of workers should not exceed 50 persons.

That the group of the companies has been qualified as average, it should correspond at least to two of following conditions:

  • The cumulative turn should make no more £22,8 million in the pure state (£27,36 million total turn);
  • The cumulative total balance should make no more £11,4 million in the pure state (£13,68 million total sum);
  • Total number of workers should not exceed 250 persons.

Attention: the Above-stated restrictions operate in the event that the termination of fiscal year is necessary on 30.01.2004 or later. For groups of the companies, whose fiscal year has ended to this term, the following qualifying conditions operate, at least of which this group should correspond to two to be qualified as average:

  • The cumulative turn should make no more £11,2 million in the pure state (£13,44 million total turn);
  • The cumulative total balance should make no more £5,6 million in the pure state (£6,72 million total sum);
  • Total number of workers should not exceed 250 persons.

How to arrive, if from the small or average company it is required to give the summary report



The small company-founder which has prepared financial reports for the members, being guided by special positions of section 246 (2) or (3) Laws on the companies from 1985, can prepare also the summary report according to special positions of section 248А. However the small group cannot submit the reduced financial reporting to Registration chamber. The summary report prepared according to section 248А, should contain an official statement on the balance report before signatures, that the summary report is made taking into account positions of the Part 7 Laws on the companies from 1985, the concerning small companies.



If the average company has made decision to prepare the summary financial reporting this reporting should be full.



Exceptions for very small companies regarding audit



What exceptions exist?



There are certain exceptions regarding audit for some small companies (including very small companies which are engaged in charity) if they have the right and apply for them. Some companies which are engaged in charity, are not exposed to auditor check, but, nevertheless, should give accounting reports as the financial reporting (a partial exception).



What small companies are not exposed to auditor check?



Not to be exposed to auditor check, the company should:

  • To be qualified as small (section 3 see);
  • To have a turn no more £5,6 million; and
  • To have a balance result no more £2,8 million

Attention: the Above-stated restrictions on audit are valid for a fiscal year which is coming to an end after 30.03.2004. If fiscal year has ended before this date the company, completely to exclude auditor check, should correspond to following conditions:

  • To be qualified as small;
  • To have a turn no more £1 million; and
  • To have a balance result no more £1,4 million

For the companies which are engaged in charities, a condition for an exception of auditor check the following: the company should be qualified as small (section 3 see), its total profit should not exceed £90 000, and its balance result should not exceed £2,8 million (£1,4 million in case fiscal year has ended 30.03.2004 or earlier).

The charitable companies qualified as small (section 3) and having total profit from £90 000 to £250 000 see  and a balance result no more than 1,4 million, have the right to a partial exception of audit.



Whether really all small companies have the right to an exception of auditor check?



No. Financial reports with an audit report should be given in Registration chamber if the company falls under one of following categories:

() the Company-founder or the enterprise-branch (if only it was not staying idle during that time as it has been registered as branch), except for following cases:

  • The group is qualified as small or can be qualified as small if all its members are the companies, and
  • The turn of all group makes no more £5,6 million in the pure state (£6,72 million total turn), and
  • The balance result of all group does not exceed £2,8 million in the pure state (£3,36 million total sum).

Attention: the Above-stated restrictions on audit are valid for a fiscal year which is coming to an end after 30.03.2004. If fiscal year has ended before this date, the company-founder or the enterprise-branch (if only it was not staying idle during that time as it has been registered as branch) cannot be qualified for these restrictions except for following cases:

  • The group is qualified as small or can be qualified as small if all its members are the companies, and
  • The turn of all group makes no more £1 million in the pure state (£1,2 million total turn), and
  • The balance result of all group does not exceed £1,4 million in the pure state (£1,68 million total sum).

(b) The Company is included into the group, any of which members:

  • Is the open company or the legal body (not the company), according to the structure having the right to offer actions or bonds in open sale;
  • 4 Laws on financial services and the markets from 2000 have the right according to the Part to conduct adjustable activity;
  • Is engaged in insurance.

() the Person having the permission according to the Part of 4 Laws on financial services and the markets from 2000 on conducting of adjustable activity (but thus not being the appointed representative, whose field of activity does not concern to regulated – see further);

«Adjustable activity» does not include concept:

  • Registration of adjustable contracts of the mortgage;
  • The help in registration and performance of contracts of insurance;
  • Consultation under adjustable contracts of the mortgage; or
  • Activity as the agent on registration of investments or investment consultation when this activity concerns the investments which are carried out not on a contract basis.

(d) The Person who is engaged in insurance activity.

() the Appointed representative according to position s.39 the Law on financial services and the markets from 2000

(f) The Open company with limited liability if only it is not staying idle.

(g) The Special organisation or the association of businessmen registered according to the Law on trade unions and labour relations from 1992.

(h) The Company, in which auditor check is spent on request of one of (or several) its members owning at least of 10 % of a face-value of the let out share capital or 10 % of actions of any class, or – in case of the limited liability company – on request of 10 % of its participants. The requirement about carrying out of audit of the financial reporting of the company should be presented in the form of the notice in writing which should be submitted to the registered office at least one month prior to the termination of fiscal year about which there is a speech.

The companies with weak level of management can book audit of the financial reporting for conformity to a lease term, thus the help of the professional adviser can be necessary for them.



What documents are directed to Registration chamber by the company having the right to an exception of auditor check?



If the company is qualified properly the financial reporting without auditor check moves to the registrar in the form of the reduced balance report and notes. Before the signature of the director in the balance report the following should be declared:



() Within the year which is coming to an end … (date), the company had the right to an audit exception according to section 249 And (1) Laws on the companies of 1985 (the Companies engaged in charity and declaring a partial exception of audit, should refer to section 249 And (1)).



(b) Participants of the company did not demand audit carrying out according to section 249 In (2) Laws on the companies of 1985



() Direktory confirm the responsibility that:

i. The company conducts accounting documents according to section 221; and

ii. The prepared financial documents reflect a true state of affairs of the company on the end of fiscal year, really reflect profits and losses for a fiscal year according to section 226 requirements, meet the requirements of the Law on the companies 1985 concerning the financial reporting concerning activity of the given company.



(d) The Financial reporting is prepared according to special positions of the Part 7 Laws on the companies 1985 concerning the small companies.

The company, at own discretion, can give to the participants not reduced financial reporting. All statements set forth above should be specified in not reduced balance report.



EU companies




The companies of EU which would like to take advantage of possibility of an exception of auditor check, should prepare and submit also to Registration chamber «Report of the company of EU» and payment at a rate of £15.



What should contain in the accounting report of the company engaged in charity and having the right on partial exception of audit?




In the accounting report should be specified that:



() the financial reporting of the company for the specified fiscal year corresponds to accounting documents which are conducted by the company according to section 221 of the Law on the companies 1985; and



(b) The information in accounting documents and the financial reporting is specified and presented in the form corresponding to subsection (6) of section 249С of the Law, how much it is applicable to the given company;



() the information in accounting documents and the financial reporting meets the requirements of section 249 And (4) for the specified fiscal year and does not fall under positions of section 249 In (1) (a) – (f) in any of the periods of the specified fiscal year.



In the report the name should be filled out and stand the signature of the accounting worker who has made the report.



Who can make the report of accounting workers?




It can be:

  • Any member organisations which on the basis of rules of this organisation has the right to be engaged in public activity and approaches on a post of the bookkeeper making the reporting; or
  • Any person (irrespective of, whether it is a member of one of the specified organisations), approaching for a post of the auditor of the company according to rules of this organisation.

The list of the aforementioned organisations:

  • Institute of the diplomaed bookkeepers of England and the Wales
  • Institute of the diplomaed bookkeepers of Scotland
  • Institute of the diplomaed bookkeepers of Ireland
  • Association of the diplomaed exclusive bookkeepers
  • Association of exclusive auditors
  • Association of experts in book keeping
  • The international association of bookkeepers
  • The diplomaed institute of bookkeepers under the administrative account
  • Institute of the diplomaed secretaries and managers (this new addition is applicable by the fiscal years which are coming to an end 31.01.2004 or later).

Any physical either the legal body or firm can be appointed as the composer of the reporting. The association which is not the legal body, can be appointed according to section 26 of the Law on the companies from 1989



The composer of the reporting should be independent and answer conditions of section 27 of the Law on the companies from 1989 In particular, it means that it (it) cannot be the official or the worker of the company.

Terms of giving of the financial reporting in Registration chamber



Terms are identical to all kinds of the financial reporting, as well as penalties for it later granting

If the company has the right to an audit exception, whether it should direct financial reports to the members?



Yes. According to the Law on the companies from 1985, participants of the company have the right to receive or request copies of financial documents and corresponding reports.



Possible lacks of reports without auditor check




Operating banks and credit managers at an estimation of credit status of the company rely on the information received from Registration chamber, and also on the conclusion of the independent auditor. Therefore, when the company makes the decision on an exception of auditor check, it should be guided by concrete circumstances.

Whether annual financial reports if the company is not commercial are required?



All companies with limited liability irrespective of, whether they are commercial or not, should submit reports to Registration chamber. Nevertheless, the company with limited liability can make an application on an audit exception for the reason that it does not conduct any activity if it really did not conduct commercial activity within a fiscal year, and thus answers all other criteria.



If the company did not conduct any activity, it does not need to appoint auditors, and the tax the simple annual financial report in Registration chamber suffices.



How to arrive in case in constituent documents of the company it is specified, what it should have an auditor, but at the same time she can count on an audit exception?




The company can make the decision on revision of the constituent documents to have possibility of an exception of audit. It is improbable, that the companies, whose constituent documents are made according to the Table And the Law on the companies from 1985, have faced such problems. Nevertheless, version 1948 of the Table And (and other early versions) contains position about obligatory appointment of the auditor. The companies with such constituent documents can address for consultation to the lawyer concerning possible changes.



Registered, but not functioning (inactive) companies




If the company does not conduct any activity, it can make an application on an audit exception, it needs to prepare only the reduced balance report and its tax together with notes in Registration chamber. It does not need to submit the report on profits and losses or the report of the director, but at the same time the report of the director should be given all shareholders of the company.



The company which is doing not conduct any activity, is considered the company «without considerable accounting operations» within any fiscal year. Certain categories of operations can be ignored, if the considered accounting period of the company has ended after 26.07.2000 Nevertheless, the bank and insurance companies, which workers are registered as not having powers under the Law on financial services from 1996, can not have those privileges which are given by the status of the company, to not leading activity.



If the company is considered as not leader of activity it is possible to ignore following financial operations:

  • Payment of the actions taken by subscribers under constituent documents;
  • Payment to the registrar for change of the name of the company, registration of the company and giving of annual declarations; and
  • Payment of the penalties imposed by the registrar for untimely granting of the financial reporting.

The company can not have advantages on an exception of audit as the company, not leading activity, if it:

  • 4 Laws on financial services and the markets from 2000 have the right according to the Part to conduct adjustable activity;
  • Is engaged in insurance.

If the company was not staying idle from the moment of registration, but then there was that, she can count on an audit exception, if:

  • It became staying idle with a date closed of the last fiscal year; and
  • It did not need to submit the summary report for the last fiscal year; and
  • Concerning the last fiscal year it is qualified as the small company, or could be qualified as small, but actually is open-end company or a member of group of the companies into which enter: the open company, or 4 Laws having the right according to the Part on financial services and the markets from 2000 to conduct adjustable activity, or engaged in insurance.

What should enter into the financial reporting of the inactive companies?



In the financial reporting of the inactive companies submitted to Registration chamber, it is not necessary to include the report on profits and losses or the report of directors. The sample of balance reports is resulted in the end of this chapter.



The financial reporting of the inactive companies which were not exposed to auditor check, much easier, than the reporting of the companies which are engaged in commercial activity, but nevertheless it should contain:

  • The reduced balance report with the statement before the signature of the director that the company was staying idle during the accounting period. The full text of the statement is resulted in item 4;
  • Results of any previous year – for comparison even if during the current year there are no profits and losses;
  • Notes to the balance report (the example in the end of the given chapter see).

EU companies



The companies of EU which have advantages on an exception of auditor check, should prepare and submit also to Registration chamber «Report of the company of EU» and payment at a rate of £15.



What statements should contain in the balance report?




Before the signature of the director in the balance report the following should be declared:



() Within the year which is coming to an end … (date), the company had the right to an audit exception according to section 249 And (1) Laws on the companies of 1985



(b) Participants of the company did not demand audit carrying out according to section 249 In (2) Laws on the companies of 1985



() Direktory confirm the responsibility that:

i. The company conducts accounting documents according to section 221; and

ii. The prepared financial documents reflect a true state of affairs of the company on the end of fiscal year, really reflect profits and losses for a fiscal year according to section 226 requirements, meet the requirements of the Law on the companies 1985 concerning the financial reporting concerning activity of the given company.

The company, at own discretion, can give to the participants not reduced financial reporting. All statements set forth above should be specified in not reduced balance report.



Whether it is possible to receive in Registration chamber standard forms for the inactive companies?




It is possible though to use them unessentially. Form DCA given by Registration chamber, is intended for the inactive companies which did not conduct any commercial activity from the moment of registration. This form does not approach for the companies which conducted earlier commercial activity, and then became inactive. In the end of the given chapter samples of the balance report and notes are resulted in it for all types of the inactive companies.



Terms of giving of the financial reporting on the inactive companies in Registration chamber




Terms same, as for all other financial reporting on any companies, as well as penalties for a reporting delay.



What occurs, when the company again starts to conduct commercial activity?




Any company ceases to have the right to an exception of auditor check, if it:

  • Starts to conduct commercial or trading activity within a fiscal year; or
  • More cannot be qualified for any other reasons.

In case of performance of any of these conditions the company should give the full financial reporting for a fiscal year during which it has lost the right to an exception of auditor check, and should appoint auditors for the company. Probably, it can be qualified as having the right to an exception of audit as the average or small company.



Samples of balance reports who should move in Registration chamber the inactive companies.



In reduced forms it is shown, which information and in what format should be included in the balance report. It does not concern the companies making the financial reporting under the international standards which extend for fiscal years, since 01.01.2005 These forms are developed to reflect on purpose all possible actives and company passives. If the specified sums are distinct from zero, it is necessary to make a special mark.



These samples of balance reports are resulted only for an example and not intended for reproduction and giving in Registration chamber.



If last financial year the company conducted trading activity it is necessary to consider that the balance report of the company for previous year should reflect its financial position of that period. If since then it was not spent any accounting operations, it is necessary to transfer simply figures from balance of last year.



Two samples in shape And and are resulted In, any of them can be used. The maintenance of both forms identically, differs only a sequence of headings of the balance report.



The balance report compares:

  • In shape And – the pure sum of actives with set of a fixed capital and reserves;
  • In shape In – actives with passives (where the capital and reserves as balance articles enter).

Each record should reflect the sum in figures (not words), or it is necessary to specify «0.00».



The registration chamber will not accept documents if zero instead of figures are specified by letters.



Each column of figures should be entitled, with instructions of a date closed of current and last fiscal years.



For both forms samples of notes are led to the balance report which are added if necessary.



Notes to the balance report of the inactive company




These notes should contain:

  • Norms of book keeping, including what concern write-off and reduction of cost of actives;
  • The share capital resolved to release;
  • If actions more have been distributed than one class, it is necessary to specify quantity and the general face-value of the distributed actions of each class;
  • The information on all repayable distributed actions;
  • The information on all actions which have been distributed within a fiscal year;
  • Data on a fixed capital;
  • Data on debts;
  • The basis on which the sums of a foreign currency have been translated in pounds sterling;
  • On all points set forth above (except the data on a fixed capital) – corresponding figures for previous year;
  • Data on all enterprises-branches and quantity of actions belonging to them, and also a substantiation of absence of the summary report;
  • If the company operates as the agent of any person, it is necessary to specify it;
  • Data about the basic financial capital which could be included in well-founded cost, but has been included in the reporting over well-founded cost, and it has not been made any instructions on decrease in its cost (it is applicable by the fiscal years beginning 01.01.2005 and later).

Besides, notes can contain the following information on the enterprises-branches:

  • Data on all branches in which the company has considerable capital investments, in particular, their names and the address;
  • The name of the actual parent company and (if it is known) the country of its registration;
  • Names of the intermediary parent companies and the country of their registration or (if these companies are not registered) addresses of their basic offices;
  • Data under loans and the guarantees of the company made addressed to directors, etc.

The financial reporting of association



Rules about associations and the companies with unlimited responsibility from 1993 offer, that the companies entering into qualified association, submitted the reporting of association in the form of the appendix to the own financial reporting.



What is the qualified association?




Qualified it is considered the association operating according to the legislation of any part of Great Britain if each of its members is:



(i) The company with limited liability; or



(ii) The company with unlimited responsibility or the Scottish firm, each of which participants is the company with limited liability.



The note




() Any reference to the qualified association concerning the limited liability company is the reference only on the main partners with unlimited responsibility;



(b) Any reference to the company with limited liability, with unlimited responsibility, the Scottish firm or other association concerns all similar branches founded according to the legislation of other state.

Administrative positions of association are applicable to the majority of the limited liability companies as which general partners the companies with limited liability and which are registered according to the Law on the limited liability companies from 1907 as the main office of association should be in territory of Great Britain after registration act.



What financial documents should give associations?




Associations should prepare the financial reporting with an audit report according to the Part 7 Laws on the companies of 1985 the Law on the companies has been added by positions about the qualified associations. Nevertheless, the association can take advantage of advantages of a rule № 7 according to which it can submit the summary financial reporting prepared by one of following participants:

  • The participant of the association founded under the law of the state, entering into EUROPEAN ECONOMIC COMMUNITY; or
  • The parent company of this participant.

In these cases the reporting should be summary, prepared according to the legislation of the state to which posesses the participant. In notes should be specified that the financial reporting is prepared counting on advantages which are given by this rule.



What period the financial reporting of association should cover?




The reporting can cover any period duration till 18 months which can be specified in the agreement on association. If the period is not stipulated in the agreement, the association should give the financial reporting each 12 months with a period date closed on March, 31st each year.



When financial reports should be prepared?




The financial reporting of association should be prepared within 10 months after a date closed of fiscal year.



Terms of giving or publication of the financial reporting




The prepared financial reporting of association is necessary for putting to following reports of each of participants of association which are the companies with limited liability, and to transfer in Registration chamber. If the company with limited liability is the copartner, it should give the following information to any person under its requirement:

  • Names of all participants of association from which it is required to give copies of the financial reporting of association to the Registrar; and
  • Names of all participants of the association registered in other state of EUROPEAN ECONOMIC COMMUNITY from which it is required to publish copies of the financial reporting of association in this state.

If the head office of the qualified association is to Great Britain, and each of its participants:

  • Is the branch corresponding to the company with limited liability, registered outside of Great Britain or other state of EUROPEAN ECONOMIC COMMUNITY; or
  • Is the branch corresponding to the company with unlimited responsibility or association, formed under the country legislation according to which each participant of association is the company with limited liability or corresponding branch,

That such association is obliged:



() to track, that last financial reports were accessible to check to any person, free of charge, within the official working day at head office of association, and also their transfer if reports are executed not in English;

Thus each participant of association is obliged:



(b) To give to any person under its requirement a copy of last financial reporting of association (together with transfer if reports are executed not in English). Payment can be is taken only for the minimum administrative expenses on delivery of copies, but no more.



Exceptions to the rules of promulgation of the reporting




For participants of the qualified association there can be exceptions of the rules of promulgation of the reporting set forth above if the financial reporting of association is summary and is prepared:

The participant of association operating under the legislation of the country of the participant; or

The parent company of such participant.



In this case the summary report with an audit report should be prepared according to the legislation of the country of the participant, and in notes to the report the advantages received on exceptions to the rules should be specified. If these advantages are used, any participant of association is obliged to inform on demand the name at least one participant or the parent company, the financial reporting of association is included in whose summary report.



Whether there are penalties for infringement of rules?




Yes. Each participant of the qualified association or each director of the company-participant can be subjected to the penalty at the rate to £5000.

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