Companies House

Companies Act 2006 April 2008 Implementation leaflet

Implementations

6th April 2008

The delivery time for accounts has been reduced by one month (for both private & public limited companies). Private companies have reduced from 10 months to 9 months, and public companies from 7 months to 6 months. Full calendar months for filing periods have also been introduced. Where the accounting period ends on a month end, the accounts filing period will end on a month end, except for the first accounting period.
The accounts balance sheet and director’s report will be required to refer to the Companies Act 2006 statements.

• What are the specific references in the 2006 Act that relate to the shortening of the accounts filing periods, and when are they effective from?
  Section 442 ‘Period allowed for filing accounts’, will commence on 6th April 2008. Therefore it will apply to all accounting periods that begin on or after 6th April 2008.
• What are the changes to the statements?
  The accounts statements have changed to refer to the 2006 Act. (Click here for the new accounts statements).
  
  Can LLPs take advantage of the higher small/medium thresholds?

  Yes.  However the higher thresholds for qualifying as small or medium will only apply to LLPs with accounting periods starting on or after 1st October 2008.

  Q. Will the special rules concerning the audit of small charitable companies remain in place?

  A. For financial periods beginning on or after 1st April 2008 there are no longer special rules regarding audit exemption for charitable companies.  They can qualify for audit exemption under company law in the same way as any other company.  Charitable companies may also be subject to separate requirements for audit or other scrutiny of their accounts under charity law. For more information see http://www.charity-commission.gov.uk/ for charities registered in England or Wales or www.oscr.org.uk for charities registered in Scotland.

  Q.  Will Limited Liability Partnerships be affected by the changes brought in by the CA 06?

  A. Yes.  LLPs accounts with accounting periods starting on or after 6th April 2008 will now have 9 months to file their accounts at Companies House or 21 months from the date of incorporation.

  However the content of LLP accounts is unaffected and must still be prepared in accordance with the Companies Act 1985 as applied by the Limited Liability Partnership Regulations 2001. 

  Will certain companies still be able to file abbreviated accounts?
  Yes

• Will there be any changes to the accounts exemption thresholds?
  Yes - please click here for the new accounts exemption thresholds.
• Will the definition of ‘participating interest’ in section 260 of the Companies Act 1985 be re-enacted in secondary legislation relating to accounting?
  Yes section 260 of the 1985 Act will be reinstated without modification in the regulations to be made under Part 15 of the 2006 Act.

The company secretary becomes optional for private companies but they will remain mandatory for public companies.

• When do the company secretary changes come into force?
  From 6th April 2008 the provision for enabling private companies to choose whether they wish to have a company secretary will come into force.
• Do I still need a company secretary after 6th April 2008?
  A private company will have the option whether or not they maintain their company secretary.
• If the company decide they no longer need a company secretary what is the process?
  If the company decide they no longer need a company secretary they will need to inform Companies House via WebFiling or on the 288b form.
• Will the company be required to amend the Articles?
  The company will be required to amend the Articles if there is a specific reference to the company having a secretary. However if the Articles only refer to the secretary’s duties there is no need to make an amendment.
• When the company amends the Articles what documentation must be submitted to Companies House?
  The company must submit a written or special resolution together with an updated version of the Articles.
• Can a company have a sole director and no secretary?
  Yes.
• Must the secretary be a person or can they be a corporate?
  The new provisions being introduced in October 2008 relating to natural directors, do not apply to secretaries. Secretaries can still be corporate.
• When do the remaining provisions relating to secretaries come into force?
  These come into force on 1st October 2009. From that date secretaries who are an individual person will be able to file a service address for the public record and corporate secretaries will be required to give details of where they are registered and the registered company number, if applicable.

Public limited companies need to establish whether they are maintaining the minimum share capital in sterling or euros (previously only sterling was permitted)

• What section of the 2006 Act relates to the public company minimum share capital changes?
  Sections 761 – 767 in the 2006 Act relate to the public company minimum share capital in euros.
• What will the authorised capital requirements be for PLC’s?
  
  A. From 6th April 2008:

• a public company may be incorporated satisfying the authorised minimum in sterling (£50,000) or euros (€65,600)
• an application by a public company for a certificate to commence business and borrow (trading certificate) will no longer be required to be in the form of a statutory declaration.
• a public company applying for a trading certificate or a private company re-registering to a public company will need to determine on the application whether they are meeting the authorised minimum requirement in sterling or euros.

Q. Will there be changes to any forms?

A. Companies may continue to use the existing prescribed forms 117 (application for a trading certificate) and 43(3) (application by a private company for re-registration as a public company), but will need to modify them as appropriate, so that they comply with the new provisions for applications made on or after 6th April 2008.

Companies House has produced optional forms 117 and 43(3), which have been modified to meet the new requirements for applications made on or after 6th April 2008 and companies may wish to use these instead of the prescribed forms.

Are there any changes to the requirements for audit and auditors in the CA 2006?

Yes.  For accounting periods starting on or after 6th April 2008 auditors reports will have to state, in the case of an individual, the name of the auditor and be signed by him.   Where the auditor is a firm the report must state the name of the senior statutory auditor, the name of the firm and be signed by the statutory auditor in his own name.  All signatures on auditors reports must be dated.

Will there be any exemptions from stating the auditors name on the auditors report?

Yes.  If the company feels that there is a risk that the auditor or any other person is at risk of serious violence or intimidation as a result of the auditors’ name being stated they may pass a resolution to omit the name.   A notice of the resolution must be given to the Secretary of State.  This will only be applicable to auditors reports relating to accounting periods starting on or after 06 April 2008.
Note – under no circumstances should a copy of the resolution or notice be filed at Companies House

Are there any other changes in Part 16 – Audit?

Yes.   Section 507 now includes an offence where a person knowingly or recklessly causes an auditors report to include any misleading, false or deceptive material.  A person guilty of this offence will be liable to a fine up to a maximum of £5000. Sections 522-525 are new provisions which introduce new duties on auditors and companies to notify the appropriate authorities when an auditor leaves office, setting out the circumstances or reasons if any.