Building Societies Act 1986

Changes over time for: Section 78

Version Superseded: 01/05/2017

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Point in time view as at 28/06/2016. This version of this provision has been superseded.

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Building Societies Act 1986, Section 78 is up to date with all changes known to be in force on or before 19 August 2024. There are changes that may be brought into force at a future date. Changes that have been made appear in the content and are referenced with annotations.

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78 [F1Auditor’s report] .U.K.

(1)The [F2auditor] of a building society shall make a [F3written ] report to the members on the annual accounts which are to be laid before the society at the annual general meeting during [F4his] tenure of office.

(2)The [F5auditor’s report] shall F6. . . be open to inspection by any member [F7at the annual general meeting of the building society].

(3)The [F8auditor shall, in his] report under subsection (1) above, also make a report to the members on—

(a)the annual business statement, and

(b)the directors’ report,

in so far as subsection (7) below requires [F9him] to do so.

[F10(3A)The auditor's report must include—

(a)the identity of the building society whose annual accounts are the subject of the audit,

(b)a description of the annual accounts that are the subject of the audit (including the period covered by those accounts),

(c)a description of the financial reporting framework that has been applied in the preparation of those accounts, and

(d)a description of the scope of the audit identifying the auditing standards in accordance with which the audit was conducted.

(4)The report must clearly state the opinion of the auditor as to—

(a)whether the annual accounts have been properly prepared in accordance with the requirements of this Act (and, where applicable, Article 4 of the IAS Regulation), and

(b)in particular whether the annual accounts give a true and fair view in accordance with the relevant financial reporting framework—

(i)in the case of an individual balance sheet, of the state of affairs of the society as at the end of the financial year,

(ii)in the case of an individual income and expenditure account, of the income and expenditure of the society for the financial year, and

(iii)in the case of group accounts, of the state of affairs as at the end of the financial year and the income and expenditure for the financial year of the society and the subsidiary undertakings dealt with in the group accounts, so far as concerns members of the society.

(4A)The auditor's opinion must—

(a)be either unqualified or qualified,

(b)include a reference to any matters to which the auditor wishes to draw attention by way of emphasis without qualifying the audit opinion,

(c)include a statement on any material uncertainty relating to events or conditions that may cast significant doubt about the building society's ability to continue as a going concern, and

(d)identify the auditor's place of establishment.]

(6)If the [F11auditor’s report] includes a qualification of [F11his opinion] that the annual accounts give a true and fair view of the matters specified in subsection (4)[F12(b)] above, [F13subsection (8) of section 76 extends ] also to the [F11auditor’s report].

[F14(7)The auditor's report, in so far as it deals with the documents specified in subsection (3) above, must—

(a)state whether, in his opinion, based on the work undertaken in the course of the audit—

(i)the documents have been prepared so as to conform to the requirements of, or made under, sections 74 and 75 respectively,

(ii)the information given in the annual business statement gives a true representation of the matters in respect of which it is given, and

(iii)the information given in the directors' report for the financial year for which the accounts are prepared is consistent with those accounts,

(b)state whether, in the light of the knowledge and understanding of the building society and its environment obtained in the course of the audit, the auditor has identified material misstatements in the directors' report, and

(c)if applicable, give an indication of the nature of each of the misstatements referred to in paragraph (b).]

(8)The [F15auditor’s report] on the annual business statement shall not deal with any matters which, by virtue of section 74(6), are not to be the subject of report under this section.

(9)The [F16auditor] of a building society shall, as regards the statement of particulars of transactions falling within section 65 which the society is to make available for "inspection by members under section 68(3), examine the statement before it is made available to members and make a report to the members on it; and the report shall be annexed to the statement before it is so made available.

(10)The [F17auditor’s report] under subsection (9) above shall state whether in [F18his opinion] the statement contains the particulars required by section 68; and where [F18his opinion] is that it does not, [F19he shall include in his] report, so far as [F20he is] reasonably able to do so, a statement giving the requisite particulars.

[F21(11)Where more than one person is appointed as an auditor—

(a)all the persons appointed must jointly make a report under this section and the report must include a statement as to whether all the persons appointed agree—

(i)on the matters contained in the report, and

(ii)on the statements and indications given under subsection (7); and

(b)if all the persons appointed cannot agree on—

(i)the matters contained in the report, or

(ii)on the statements and indications given under subsection (7),

the report must include the opinions of each person appointed and give reasons for the disagreement.]

Textual Amendments

F1Words in s. 78 heading substituted (29.6.2008) by The Building Societies Act 1986 (Accounts, Audit and EEA State Amendments) Order 2008 (S.I. 2008/1519), art. 1(2), Sch. 2 para. 4(l)

F2Word in s. 78(1) substituted (29.6.2008) by The Building Societies Act 1986 (Accounts, Audit and EEA State Amendments) Order 2008 (S.I. 2008/1519), art. 1(2), Sch. 2 para. 4(a)(i)

F3Word in s. 78(1) inserted (17.6.2016) by The Statutory Auditors and Third Country Auditors Regulations 2016 (S.I. 2016/649), reg. 1(1)(a), Sch. 4 para. 3(a) (with reg. 1(6))

F4Word in s. 78(1) substituted (29.6.2008) by The Building Societies Act 1986 (Accounts, Audit and EEA State Amendments) Order 2008 (S.I. 2008/1519), art. 1(2), Sch. 2 para. 4(a)(ii)

F5Words in s. 78(2) substituted (29.6.2008) by The Building Societies Act 1986 (Accounts, Audit and EEA State Amendments) Order 2008 (S.I. 2008/1519), art. 1(2), Sch. 2 para. 4(b)