The Companies (Summary Financial Statement) Regulations 2008

PART 2 CONDITIONS FOR SENDING OUT SUMMARY FINANCIAL STATEMENT

Cases in which sending of summary financial statement prohibited

4.—(1) In the following cases a company may not send a summary financial statement to a person specified in regulation 3—

(a) in the case of any such person, where it is prohibited from doing so by any relevant provision of its constitution, and

(b) in the case of any such person who is the holder of a debenture, where it is prohibited from doing so by a relevant provision in any instrument constituting or otherwise governing any of the company’s debentures of which that person is a holder.

(2) In the following cases a company may not send a summary financial statement to any person specified in regulation 3 in relation to any financial year—

(a) where, in relation to that year, no auditor’s report has been made in respect of the annual accounts of the company, or the directors’ report, or the auditable part of the directors’ remuneration report, where relevant, under sections 495 (auditor’s report on company’s annual accounts), 496 (auditor’s report on directors’ report) and 497 (auditor’s report on auditable part of directors’ remuneration report) of the 2006 Act respectively;

(b) where the period for filing accounts and reports for that year under section 442 of the 2006 Act (period for filing accounts) has expired;

(c) where the summary financial statement in respect of that financial year has not been approved by the board of directors and the original statement has not been signed on behalf of the board by a director of the company.

(3) For the purposes of paragraph (l) any provision (however expressed) which requires copies of the full accounts and reports to be sent to a person specified in regulation 3, or which forbids the sending of summary financial statements under section 426 of the 2006 Act (option to provide summary financial statement), is a relevant provision.

Ascertainment of the wishes of a person specified in regulation 3

5.—(1) A company may not send a summary financial statement to a person specified in regulation 3 unless the company has ascertained that the person does not wish to receive copies of its full accounts and reports, and paragraphs (2) and (3) apply for the ascertainment of whether or not such a person wishes to receive copies of the full accounts and reports for a financial year.

(2) Where a person specified in regulation 3 has expressly notified the company either that he wishes to receive copies of the full accounts and reports or that he wishes, instead of copies of those documents, to receive summary financial statements, the company must send copies of the full accounts and reports or summary financial statement, as appropriate, to that person in respect of the financial years to which the notification applies.

(3) Where there has been no such express notification to the company by such a person, that person may be taken to have elected to receive summary financial statements if he fails to respond to an opportunity to elect to receive copies of the full accounts and reports given to him either—

(a) by a consultation notice under regulation 6, or

(b) as part of a relevant consultation of his wishes by the company under regulation 7.

(4) For the purposes of paragraph (2) a notification has effect in relation to a financial year if it relates to that year (whether or not it has been given at the invitation of the company) and if it has been received by the company not later than 28 days before the first date on which copies of the full accounts and reports for that year are sent to the persons specified in regulation 3 in accordance with section 423 of the 2006 Act.

Consultation by notice

6.—(1) A consultation notice under this regulation is notice given by a company to a person specified in regulation 3 which—

(a) states that for the future, so long as he is a person so specified, he will be sent a summary financial statement for each financial year instead of a copy of the company’s full accounts and reports, unless he notifies the company that he wishes to receive full accounts and reports,

(b) states that the summary financial statement for a financial year will contain a summary of the company’s or group’s profit and loss account, balance sheet and, in the case of a quoted company, directors’ remuneration report for that year, and may contain additional information derived from the directors’ report,

(c) states that the card or form accompanying the notice in accordance with regulation 8(3) must be returned by a date specified in the notice, being a date at least 21 days after service of the notice and not less than 28 days before the first date on which copies of the full accounts and reports for the next financial year for which that person is entitled to receive them are sent out to persons specified in regulation 3 in accordance with section 423 of the 2006 Act,

(d) includes a statement in a prominent position to the effect that a summary financial statement will not contain sufficient information to allow as full an understanding of the results and state of affairs of the company or group as would be provided by the full annual accounts and reports and that persons specified in regulation 3 requiring more detailed information have the right to obtain, free of charge, a copy of the company’s last full accounts and reports.

(2) In the case of an unquoted company the notice must also state that the summary financial statement will—

(a) contain a statement by the company’s auditor of his opinion as to whether the summary financial statement—

(i) is consistent with the company’s annual accounts and, where information derived from the directors’ report is included in the statement, with that report, and

(ii) complies with the requirements of section 427 of the 2006 Act (form and contents of summary financial statement: unquoted companies) and of these Regulations;

(b) state whether the auditor’s report on the annual accounts was unqualified or qualified.

(3) In the case of a quoted company the notice must also state that the summary financial statement will—

(a) contain a statement by the company’s auditor of his opinion as to whether the summary financial statement—

(i) is consistent with the company’s annual accounts and the directors’ remuneration report and, where information derived from the directors’ report is included in the statement, with that report, and

(ii) complies with the requirements of section 428 of the 2006 Act (form and contents of summary financial statement: quoted companies) and of these Regulations;

(b) state whether the auditor’s report on the annual accounts was unqualified or qualified.

Relevant consultation

7.—(1) A company may conduct a relevant consultation to ascertain the wishes of a person specified in regulation 3.

(2) For the purposes of this regulation, a relevant consultation of the wishes of such a person is a notice given to that person which—

(a) states that for the future, so long as he is a person specified in regulation 3, he will be sent a summary financial statement instead of the full accounts and reports of the company, unless he notifies the company that he wishes to continue to receive full accounts and reports;

(b) accompanies a copy of the full accounts and reports; and

(c) accompanies a copy of a summary financial statement, prepared in accordance with section 426 of the 2006 Act, and sections 427 and 428 of that Act, as appropriate, and these Regulations, with respect to the financial year covered by those full accounts and reports and which is identified in the notice as an example of the document which that person will receive for the future, so long as he is a person specified in regulation 3, unless he notifies the company to the contrary.

Supplementary provisions for Part 2

8.—(1) Subject to any requirement or contrary provision of this Part the company communications provisions of the 2006 Act apply to any notice or other communication required or authorised to be sent to or by the company by any provision in this Part.

(2) This regulation and regulations 5, 6 and 7 apply to a person who is entitled, whether conditionally or unconditionally, to become a person specified in section 423(l) of the 2006 Act in relation to the company, but who has not yet become such a person, as they apply to a person specified in regulation 3.

(3) Subject to paragraph (4), a notice given under regulation 6 or 7 must be accompanied by a card or form—

(a) in respect of which, in the case of a card or form sent by post, any postage necessary for its return to the company has been, or will be, paid by the company, and

(b) which is so worded as to enable a person specified in regulation 3, by marking a box and returning the card or form, to notify the company that he wishes to receive full accounts and reports for the next financial year for which he is entitled to receive them as such a person and for all future financial years after that.

(4) The company need not pay the postage in respect of the return of the card or form in the following circumstances—

(a) if the address of a member to which notices are sent in accordance with the company’s constitution is not within an EEA State,

(b) if the address of a debenture holder to which notices are sent in accordance with the terms of any instrument constituting or otherwise governing the debentures of which he is a holder is not within an EEA State, or

(c) if the address of a person to whom paragraph (2) applies to which notices are sent, in accordance with the contractual provisions under which he has a right (conditionally or unconditionally) to become a person specified in section 423(l) of the 2006 Act, is not within an EEA State.