No person shall be subject to any liability to a person other than the company resulting from reliance, by that person or another, on information in a report to which this section applies.

The reference in subsection (4) to a person being subject to a liability includes a reference to another person being entitled as against him to be granted any civil remedy or to rescind or repudiate an agreement.

In this Part “accounting standards” means statements of standard accounting practice issued by such body or bodies as may be prescribed by regulations.

References in this Part to accounting standards applicable to a company's annual accounts are to such standards as are, in accordance with their terms, relevant to the company's circumstances and to the accounts.

Regulations under this section may contain such transitional and other supplementary and incidental provisions as appear to the Secretary of State to be appropriate.

A company qualifies as medium-sized in relation to its first financial year if the qualifying conditions are met in that year.

The qualifying conditions are met by a company in a year in which it satisfies two or more of the following requirements—

For a period that is a company's financial year but not in fact a year the maximum figures for turnover must be proportionately adjusted.

The balance sheet total means the aggregate of the amounts shown as assets in the company's balance sheet.

This section is subject to section 466 (companies qualifying as medium-sized: parent companies).

A parent company qualifies as a medium-sized company in relation to a financial year only if the group headed by it qualifies as a medium-sized group.

A group qualifies as medium-sized in relation to the parent company's first financial year if the qualifying conditions are met in that year.

The qualifying conditions are met by a group in a year in which it satisfies two or more of the following requirements—

The aggregate figures are ascertained by aggregating the relevant figures determined in accordance with section 465 for each member of the group.

In relation to the aggregate figures for turnover and balance sheet total—

• “net” means after any set-offs and other adjustments made to eliminate group transactions—

  1. a

     in the case of Companies Act accounts, in accordance with regulations under section 404,

  2. b

     in the case of IAS accounts, in accordance with international accounting standards; and

• “gross” means without those set-offs and other adjustments.

A company may satisfy any relevant requirement on the basis of either the net or the gross figure.

A company is a small company for the purposes of subsection (2) if it qualified as small in relation to its last financial year ending on or before the end of the financial year in question.

This section does not prevent a company from taking advantage of section 417(7) (business review: non-financial information) by reason only of its having been a member of an ineligible group at any time within the financial year in question.

The regulations may amend this Part by adding, altering or repealing provisions.

The regulations may create criminal offences in cases corresponding to those in which an offence is created by an existing provision of this Part.

The maximum penalty for any such offence may not be greater than is provided in relation to an offence under the existing provision.

The regulations may provide for civil penalties in circumstances corresponding to those within section 453(1) (civil penalty for failure to file accounts and reports).

The provisions of section 453(2) to (5) apply in relation to any such penalty.

The amounts set out in the annual accounts of a company may also be shown in the same accounts translated into euros.

When complying with section 441 (duty to file accounts and reports), the directors of a company may deliver to the registrar an additional copy of the company's annual accounts in which the amounts have been translated into euros.

Subsection (3)(b) does not apply to the Companies Act individual accounts of a company for a financial year in which the company qualifies as a micro-entity (see sections 384A and 384B).

For the purposes of sections 434 and 435 (requirements in connection with published accounts) any additional copy of the company's annual accounts delivered to the registrar under subsection (2) above shall be treated as statutory accounts of the company.

In the case of such a copy, references in those sections to the auditor's report on the company's annual accounts shall be read as references to the auditor's report on the annual accounts of which it is a copy.

The Secretary of State may by regulations apply to banking partnerships, subject to such exceptions, adaptations and modifications as he considers appropriate, the provisions of this Part (and of regulations made under this Part) applying to banking companies.

A “banking partnership” means a partnership which has permission under F36Part 4A of the Financial Services and Markets Act 2000 (c. 8).

But a partnership is not a banking partnership if it has permission to accept deposits only for the purpose of carrying on another regulated activity in accordance with that permission.

Expressions used in this section that are also used in the provisions regulating activities under the Financial Services and Markets Act 2000 have the same meaning here as they do in those provisions.

See section 22 of that Act, orders made under that section and Schedule 2 to that Act.

Regulations under this section are subject to affirmative resolution procedure.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F32... In the case of a company which qualifies as a micro-entity in relation to a financial year (see sections 384A and 384B), the notes to the accounts for that year required by section 413 of this Act and regulation 5A of, and paragraph 57 of Part 3 of Schedule 1 to, the Small Companies and Groups (Accounts and Directors’ Report) Regulations 2008 ( S.I. 2008/409 ) must be included at the foot of the balance sheet.

References in this Part to a company's annual accounts, or to a balance sheet or profit and loss account, include notes to the accounts giving information which is required by any provision of this Act or international accounting standards, and required or allowed by any such provision to be given in a note to company accounts.

In this Part “ corporate governance statement ” means the statement required by rules 7.2.1 to 7.2.11 in the Disclosure Rules and Transparency Rules sourcebook F7 made by the Financial Conduct Authority .

Those rules were inserted by Annex C of the Disclosure Rules and Transparency Rules Sourcebook (Corporate Governance Rules) Instrument 2008 made by the Authority on 26th June 2008 (FSA 2008/32).

A “separate” corporate governance statement means one that is not included in the directors' report.

This section applies to regulations under the following provisions of this Part—

• section 396 (Companies Act individual accounts),

• section 404 (Companies Act group accounts),

• section 409 (information about related undertakings),

• section 412 (information about directors' benefits: remuneration, pensions and compensation for loss of office),

• section 416 (contents of directors' report: general),

• section 421 (contents of directors' remuneration report),

• section 444 (filing obligations of companies subject to small companies regime),

• section 445 (filing obligations of medium-sized companies),

• section 468 (general power to make further provision about accounts and reports).

Any such regulations may make consequential amendments or repeals in other provisions of this Act, or in other enactments.

Otherwise, the regulations are subject to negative resolution procedure.

In this Part—

• “e-money issuer” F8means—

  1. a

     an electronic money institution, within the meaning of the Electronic Money Regulations 2011 ( S.I. 2011/99), or

  2. b

     a person who has permission under F35Part 4A of the Financial Services and Markets Act 2000 (c. 8) to carry on the activity of issuing electronic money within the meaning of article 9B of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (S.I. 2001/544);

• “group” means a parent undertaking and its subsidiary undertakings;

• “IAS Regulation” means EC Regulation No. 1606/2002 of the European Parliament and of the Council of 19 July 2002 on the application of international accounting standards;

• “included in the consolidation”, in relation to group accounts, or “included in consolidated group accounts”, means that the undertaking is included in the accounts by the method of full (and not proportional) consolidation, and references to an undertaking excluded from consolidation shall be construed accordingly;

• “international accounting standards” means the international accounting standards, within the meaning of the IAS Regulation, adopted from time to time by the European Commission in accordance with that Regulation;

• F24“micro-entity minimum accounting item” means an item of information required by this Part or by regulations under this Part to be contained in the Companies Act individual accounts of a company for a financial year in relation to which it qualifies as a micro-entity (see sections 384A and 384B);

• “micro-entity provisions” means any provisions of this Part, Part 16 or regulations under this Part relating specifically to the individual accounts of a company which qualifies as a micro-entity;

• F9. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• F10 “ MiFID investment firm ” means an investment firm within the meaning of Article 4.1.1 of Directive 2004/39/ EC of the European Parliament and of the Council of 21 April 2004 on markets in financial instruments, other than—

  1. a

     a company to which that Directive does not apply by virtue of Article 2 of that Directive,

  2. b

     a company which is an exempt investment firm within the meaning of regulation 4A(3) of the Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2007, and

  3. c

     any other company which fulfils all the requirements set out in regulation 4C(3) of those Regulations;

• “profit and loss account”, in relation to a company that prepares IAS accounts, includes an income statement or other equivalent financial statement required to be prepared by international accounting standards;

• F25“qualified”, in relation to an auditor’s report, means that the report does not state the auditor’s unqualified opinion that the accounts have been properly prepared in accordance with this Act;

• “regulated activity” has the meaning given in section 22 of the Financial Services and Markets Act 2000, except that it does not include activities of the kind specified in any of the following provisions of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (S.I. 2001/544)—

  1. a

     article 25A (arranging regulated mortgage contracts),

  2. b

     article 25B (arranging regulated home reversion plans),

  3. c

     article 25C (arranging regulated home purchase plans),

  4. ca

     F11article 25E (arranging regulated sale and rent back agreements),

  5. d

     article 39A (assisting administration and performance of a contract of insurance),

  6. e

     article 53A (advising on regulated mortgage contracts),

  7. f

     article 53B (advising on regulated home reversion plans),

  8. g

     article 53C (advising on regulated home purchase plans),

  9. ga

     F12article 53D (advising on regulated sale and rent back agreements),

  10. h

      article 21 (dealing as agent), article 25 (arranging deals in investments) or article 53 (advising on investments) where the activity concerns relevant investments that are not contractually based investments (within the meaning of article 3 of that Order), or

  11. i

      article 64 (agreeing to carry on a regulated activity of the kind mentioned in paragraphs (a) to (h));

• F25“traded company” means a company any of whose transferable securities are admitted to trading on a regulated market;

• “turnover”, in relation to a company, means the amounts derived from the provision of goods and services F26..., after deduction of—

  1. a

     trade discounts,

  2. b

     value added tax, and

  3. c

     any other taxes based on the amounts so derived;

• “UCITS management company” has the meaning given by the Glossary forming part of the Handbook made by the F13Financial Conduct Authority under the Financial Services and Markets Act 2000 (c. 8).

In the case of an undertaking not trading for profit, any reference in this Part to a profit and loss account is to an income and expenditure account.

References to profit and loss and, in relation to group accounts, to a consolidated profit and loss account shall be construed accordingly.