Part VIIIU.K. Accounts and Audit

Modifications etc. (not altering text)

C2Pt. VIII (ss. 71–82) modified (temp.until 1.1.1993) by S.I. 1990/1392, art. 6(3)

Auditors and audit of accountsU.K.

78 [F1Auditor’s report] .U.K.

(1)The [F2auditor] of a building society shall make a report to the members on the annual accounts which are to be laid before the society at the annual general meeting during [F3his] tenure of office.

(2)The [F4auditor’s report] shall F5. . . be open to inspection by any member [F6at the annual general meeting of the building society].

(3)The [F7auditor 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 [F8him] to do so.

[F9(3A)The [F10auditor’s report] must include—

(a)an introduction identifying the annual accounts that are the subject of the audit and the financial reporting framework that has been applied in their preparation;

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

(3B)The report must state clearly whether in the [F11auditor’s opinion] the annual accounts have been properly prepared in accordance with the requirements of this Act (and, where applicable, Article 4 of the IAS Regulation).

(4)The report must state in particular whether the annual accounts give a true and fair view in accordance with the relevant financial reporting framework—

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

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

(c)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 [F12auditor’s report]—

(a)must be either unqualified or qualified, and

(b)must include a reference to any matters to which the statutory [F13auditor wishes] to draw attention by way of emphasis without qualifying the report.]

(6)If the [F14auditor’s report] includes a qualification of [F14his opinion] that the annual accounts give a true and fair view of the matters specified in subsection (4) above, subsections (8) and (9) of section 76 extend also to the [F14auditor’s report].

(7)The [F15auditor’s report], in so far as it deals with the documents specified in subsection (3) above, shall state whether [F16he has] been prepared so as to conform to the requirements of sections 74 and 75 respectively and the regulations thereunder and whether, in the opinion of the [F17auditor]—

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

(b)the information given in the directors’ report is consistent with the accounting records and the annual accounts for the year.

(8)The [F18auditor’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 [F19auditor] 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 [F20auditor’s report] under subsection (9) above shall state whether in [F21his opinion] the statement contains the particulars required by section 68; and where [F21his opinion] is that it does not, [F22he shall include in his] report, so far as [F23he is] reasonably able to do so, a statement giving the requisite particulars.

Textual Amendments

F5Words in s. 78(2) repealed (11.1.1996) by S.I. 1995/3233, art. 6(a)

F6Words in s. 78(2) inserted (11.1.1996) by S.I. 1995/3233, art. 6(b)

F9S. 78(3A)-(4A) substituted (22.12.2004) (with effect in accordance with art. 1(2) of the amending S.I.) for s. 78(4)(5) by The Building Societies Act 1986 (International Accounting Standards and Other Accounting Amendments) Order 2004 (S.I. 2004/3380), arts. 1, 5(2)

Modifications etc. (not altering text)

C3S. 78 restricted (1. 1. 1993) by S.I. 1992/359, reg. 9(4) (with reg. 2(2))