Companies Act 1985

229 Group accounts of holding company

(1) If at the end of its financial year a company has subsidiaries, the directors shall, as well as preparing individual accounts for that year, also prepare group accounts, being accounts or statements which deal with the state of affairs and profit or loss of the company and the subsidiaries.

(2) This does not apply if the company is at the end of the financial year the wholly-owned subsidiary of another body corporate incorporated in Great Britain.

(3) Group accounts need not deal with a subsidiary if the company's directors are of opinion that—

(a) it is impracticable, or would be of no real value to the company's members, in view of the insignificant amounts involved, or

(b) it would involve expense or delay out of proportion to the value to members, or

(c) the result would be misleading, or harmful to the business of the company or any of its subsidiaries, or

(d) the business of the holding company and that of the subsidiary are so different that they cannot reasonably be treated as a single undertaking;

and, if the directors are of that opinion about each of the company's subsidiaries, group accounts are not required.

(4) However, the approval of the Secretary of State is required for not dealing in group accounts with a subsidiary on the ground that the result would be harmful or on the ground of difference between the business of the holding company and that of the subsidiary.

(5) A holding company's group accounts shall be consolidated accounts comprising—

(a) a consolidated balance sheet dealing with the state of affairs of the company and all the subsidiaries to be dealt with in group accounts, and

(b) a consolidated profit and loss account dealing with the profit or loss of the company and those subsidiaries.

(6) However, if the directors are of opinion that it is better for the purpose of presenting the same or equivalent information about the state of affairs and profit or loss of the company and those subsidiaries, and of so presenting it that it may be readily appreciated by the company's members, the group accounts may be prepared in other than consolidated form, and in particular may consist—

(a) of more than one set of consolidated accounts dealing respectively with the company and one group of subsidiaries and with other groups of subsidiaries, or

(b) of separate accounts dealing with each of the subsidiaries, or

(c) of statements expanding the information about the subsidiaries in the company's individual accounts,

or of any combination of those forms.

(7) The group accounts may be wholly or partly incorporated in the holding company's individual balance sheet and profit and loss account