Companies (1986 Order) (Accounts of Small and Medium-Sized Enterprises and Publication of Accounts in ECUs) Regulations (Northern Ireland) 1992

Made: 26th November 1992

Coming into operation: 31st December 1992

The Department of Economic Development, in exercise of the powers conferred on it by Article 265(1) and (3) of the Companies (Northern Ireland) Order 1986[^f00001] and of every other power enabling it in that behalf, hereby makes the following Regulations:—

Citation, commencement and interpretation

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• (1) These Regulations may be cited as the Companies (1986 Order) (Accounts of Small and Medium-Sized Enterprises and Publication of Accounts in ECUs) Regulations (Northern Ireland) 1992 and shall come into operation on 31st December 1992.

• (2) In these Regulations “the 1986 Order” means the Companies (Northern Ireland) Order 1986.

Delivery and publication of accounts in ECUs

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The following Article is inserted into the 1986 Order after Article 250A[^f00002]—

(250B) (1) The amounts set out in the annual accounts of a company may also be shown in the same accounts translated into ECUs. (2) When complying with Article 250[^f00003], 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 ECUs. (3) In both cases (a) the amounts must have been translated at the relevant exchange rate prevailing on the balance sheet date, and (b) that rate must be disclosed in the notes to the accounts. (4) For the purposes of Article 248[^f00004] any additional copy of the company’s annual accounts delivered to the registrar under paragraph (2) shall be treated as statutory accounts of the company and, in the case of such a copy, references in Article 248 to the auditors' report under Article 243[^f00005] shall be read as references to the auditors' report on the annual accounts of which it is a copy. (5) In this Article— - “ECU” means a unit with a value equal to the value of the unit of account known as the ecu used in the European Monetary System, and - “relevant exchange rate” means the rate of exchange used for translating the value of the ecu for the purposes of that System.

Modifications of Part VIII of the 1986 Order with respect to small and medium-sized companies and groups

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• (1) In Article 254 of the 1986 Order (exemptions for small and medium-sized companies[^f00006] the following paragraphs are inserted after paragraph (1)—

(1A) A company which qualifies as a small company in relation to a financial year is entitled to the exemptions provided by Part I of Schedule 8[^f00007] with respect to the preparation of annual accounts for that year if its balance sheet contains, immediately above the signature required by Article 241[^f00008]— (a) a statement that advantage has been taken, in the preparation of the accounts, of special exemptions applicable to small companies, and (b) a statement of the grounds on which, in the directors' opinion, the company is entitled to those exemptions. (1B) A company which qualifies as a small company in relation to a financial year is entitled to the exemptions provided by Part II of Schedule 8 with respect to the preparation of a directors' report for that year if the report contains, immediately above the signature required by Article 242A[^f00009]— (a) a statement that advantage has been taken, in the preparation of the report, of special exemptions applicable to small companies, and (b) where the company’s balance sheet for that year does not contain a statement under paragraph (1)(A)(b), a statement of the grounds on which, in the directors' opinion, the company is entitled to those exemptions.

• (2) In the same Article—

• (a) in paragraph (1)(b) before the words “Schedule 8” there shall be inserted the words “Part III of”,

• (b) paragraph (2) is hereby repealed, and

• (c) in paragraph (3) for the words “paragraph (1)” there shall be substituted the words “paragraphs (1), (1A) and (1B)”.

• (3) Schedule 8 to the 1986 Order is modified in accordance with the provisions of the Schedule.

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• (1) Article 255 of the 1986 Order (qualification of company as small or medium-sized)[^f00010] is modified as follows.

• (2) In paragraph (2)(a>, for the words “paragraph (1)” there shall be substituted the words “paragraph (1) or was treated as so qualifying under sub-paragraph (b)”.

• (3) In paragraph (3), under the heading “Small company”, for the words “Not more than £2 million” (for turnover) there shall be substituted the words “Not more than £2.8 million” and for the words “Not more than £975,000” (for the balance sheet total) there shall be substituted the words “Not more than £1.4 million”.

• (4) In paragraph (3), under the heading “Medium-sized company”, for the words “Not more than £8 million” (for turnover) there shall be substituted the words “Not more than £11.2 million” and for the words “Not more than £3.9 million” (for the balance sheet total) there shall be substituted the words “Not more than £5.6 million”.

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• (1) Article 257 of the 1986 Order (qualification of group as small or (medium-sized)[^f00011] is modified as follows.

• (2) In paragraph (2)(a), for the words “paragraph (1)” there shall be substituted the words “paragraph (1) or was treated as so qualifying under sub-paragraph (b)” .

• (3) In paragraph (3), under the heading “Small group”, for the words “Not more than £2 million net (or £2.4 million gross)” (for aggregate turnover) there shall be substituted the words “Not more than £2.8 million net (or £3.36 million gross)” and for the words “Not more than £1 million net (or £1.2 million gross)” (for the aggregate balance sheet total) there shall be substituted the words “Not more than £1.4 million net (or £1.68 million gross)”.

• (4) In paragraph (3), under the heading “Medium-sized group”, for the words “Not more than £8 million net (or £9.6 million gross)” (for aggregate turnover) there shall be substituted the words “Not more than £11.2 million net (or £13.44 million gross)” and for the words “Not more than £3.9 million net (or £4.7 million gross)” (for the aggregate balance sheet total) there shall be substituted the words “Not more than £5.6 million net (or £6.72 million gross).”

Transitional provisions

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• (1) These Regulations shall apply to annual accounts in respect of financial years ending on or after the date of coming into operation of these Regulations, and to directors' and auditors' reports on those accounts.

• (2) In determining under Article 255 or 257 of the 1986 Order whether a company or group qualifies as small or medium-sized in relation to financial years subsequent to its first financial year which end on or after the date of coming into operation of these Regulations—

• (a) the company or group shall be treated as having qualified as small or medium-sized (as the case may be) in each previous financial year ending on or after 9th November 1990 in which it would have so qualified under Article 255(3) or 257(3) as amended by these Regulations, and

• (b) the company or group shall be treated as having qualified as small or medium-sized in any such financial year if they would have been so entitled had the company or group had the qualification it is treated as having had under sub-paragraph (a).

SCHEDULE — MODIFICATIONS OF SCHEDULE 8

Re-organisation of the schedule

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• (1) Parts I, II and III of Schedule 8 shall become, respectively, Section A, Section B and Section C of Part Ill of Schedule 8.

• (2) Paragraphs 1 to 10 of Schedule 8, as modified by paragraph 4, shall be re-numbered as paragraphs 17 to 26 of Schedule 8.

• (3) The provisions set out in paragraph 2 shall be inserted in Schedule 8 as a new Part I.

• (4) The provisions set out in paragraph 3 shall be inserted in Schedule 8 as a new Part II.

• (5) The following shall be inserted in Schedule 8 immediately after the new Part II—

(16) In this Part— - Section A relates to small companies, - Section B relates to medium-sized companies, and - Section C contains supplementary provisions.

The new Part I

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The following shall be inserted in Schedule 8 immediately after the heading, as Part I of that Schedule—

(1) The following provisions of this section apply to the individual accounts of a small company. (2) (1) In preparing its balance sheet according to the balance sheet formats set out in Section B of Part I of Schedule 4[^f00012], a small company may apply all or any of the modifications permitted by paragraphs 3 and 4. (2) Where any such modifications are applied by a small company, Schedule 4 shall be read as if the balance sheet formats were the formats as modified and references to the formats and the items in them shall be construed accordingly. (3) Subject to paragraph 5, the notes on the balance sheet formats shall continue to apply to items which have been renumbered or combined into other items by the modifications under paragraph 3 or 4. (4) For the purposes of paragraph 3(3) and (4) of Schedule 4 (power to adapt or combine items), any new item which may be included in a balance sheet by virtue of paragraph 3 or 4 shall be treated as one to which an Arabic number is assigned. (3) (1) Format 1 may be modified as follows. (2) Of the items (development costs etc.) required to be shown as sub-items of item B.I (intangible assets) there need only be shown the item “goodwill” and the other items may be combined in a new item “other intangible assets”, to be shown after “goodwill”. (3) Of the items (land and buildings etc.) required to be shown as sub-items of item B.II (tangible assets) there need only be shown the item “land and buildings” and the other items may be combined in a new item “plant and machinery etc.”, to be shown after “land and buildings”. (4) The following items (required to be shown as sub-items of item B.111 (investments)) may be combined as follows— (a) item B.III.1 (shares in group undertakings) may be combined with item B.III.3 (participating interests) in a new item under the heading “shares in group undertakings and participating interests”, to be shown as the first item under the heading “investments”, (b) item B.III.2 (loans to group undertakings) may be combined with item B.III.4 (loans to undertakings in which the company has a participating interest) in a new item under the heading “loans to group undertakings and undertakings in which the company has a participating interest” , to be shown after the new item mentioned in head (a), and (c) item B.III.6 (other loans) may be combined with item B.III.7 (own shares) in a new item under the heading “others”, to be shown after item B.III.5 (other investments other than loans). (5) Of the items (raw materials and consumables etc.) required to be shown as sub-items of item C.I (stocks) there need only be shown the item “payments on account” and the other items may be combined in a new item “stocks” to be shown before “payments on account”. (6) The following items (required to be shown as sub-items of item C.II (debtors) may be combined as follows— (a) item C.II.2 (amounts owed by group undertakings) may be combined with item C.II.3 (amounts owed by undertakings in which the company has a participating interest) in a new item under the heading “amounts owed by group undertakings and undertakings in which the company has a participating interest”, to be shown after item C.II.1 (trade debtors), (b) item C.II.4 (other debtors) may be combined together with item C.II.5 (called up share capital not paid) and item C.II.6 (prepayments and accrued income) in a new item under the heading “others”, to be shown after the new item mentioned in head(a). (7) Of the items (shares in group undertakings etc.) required to be shown as sub-items of item C.III (investments) there need only be shown the item “shares in group undertakings” and the other items may be combined in a new item “other investments”, to be shown after “shares in group undertakings”. (8) The following items (required to be shown as sub-items of item E (creditors: amounts falling due within one year)) may be combined as follows— (a) item E.6 (amounts owed to group undertakings) may be combined with item E.7 (amounts owed to undertakings in which the company has a participating interest) in a new item under the heading “amounts owed to group undertakings and undertakings in which the company has a participating interest”, to be shown after item E.2 (bank loans and overdrafts) and item E.4 (trade creditors); and (b) item E.l (debenture loans), item E.3 (payments received on account), item E.5 (bills of exchange payable), item E.8 (other creditors including taxation and social security) and item E.9 (accruals and deferred income) may be combined in a new item under the heading “other creditors”, to be shown after the new item mentioned in head (a). (9) The following items (required to be shown as sub-items of item H (creditors: amounts falling due after more than one year)) may be combined as follows— (a) item H.6 (amounts owed to group undertakings) may be combined with item H.7 (amounts owed to undertakings in which the company has a participating interest) in a new item under the heading “amounts owed to group undertakings and undertakings in which the company has a participating interest”, to be shown after H.2 (bank loans and overdrafts) and item H.4 (trade creditors), and (b) item H.1 (debenture loans), item H.3 (payments received on account), item H.5 (bills of exchange payable), item H.8 (other creditors including taxation and social security) and item H.9 (accruals and deferred income) may be combined in a new item under the heading “other creditors”, to be shown after the new item mentioned in head(a>). (10) The items (pensions and similar obligations etc.) required to be shown as sub-items of item I (provisions for liabilities and charges) and the items (capital redemption reserve etc.) required to be shown as sub-items of item K.IV (other reserves) need not be shown. (4) (1) Format 2 may be modified as follows. (2) Of the items (development costs etc.) required to be shown as sub-items of item B.l (intangible assets) under the general heading “ASSETS” there need only be shown the item “goodwill” and the other items may be combined in a new item “other intangible assets”, to be shown after “goodwill”. (3) Of the items (land and buildings etc.) required to be shown as sub-items of item B.II (tangible assets) under the general heading “ASSETS” there need only be shown the item “land and buildings” and the other items may be combined in a new item “plant and machinery etc.”, to be shown after “land and buildings”. (4) The following items (required to be shown as sub-items of item B.IIl (investments) under the general heading “ASSETS”) may be combined as follows— (a) item B.III.1 (shares in group undertakings) may be combined with item B.III.3 (participating interests) in a new item under the heading “shares in group undertakings and participating interests”, to be shown as the first item under the heading “investments”, (b) item B.III.2 (loans to group undertakings) may be combined with item B.III.4 (loans to undertakings in which the company has a participating interest) in a new item under the heading “loans to group undertakings and undertakings in which the company has a participating interest” , to be shown after the new item mentioned in head (a), and (c) item B.III.6 (other loans) may be combined with item B.III.7 (own shares) in a new item under the heading “others”, to be shown after item B.III.5 (other investments other than loans). (5) Of the items (raw materials and consumables etc.) required to be shown as sub-items of item C. 1 (stocks) under the general heading “ASSETS” there need only be shown the item “payments on account” and the other items may be combined in a new item “stocks”, to be shown before “payments on account”. (6) The following items (required to be shown as sub-items of item C.11 (debtors) under the general heading “ASSETS”) may be combined as follows— (a) item C.II.2 (amounts owed by group undertakings) may be combined with item C.II.3 (amounts owed by undertakings in which the company has a participating interest) in a new item under the heading “amounts owed by group undertakings and undertakings in which the company has a participating interest”, to be shown after item C.11.1 (trade debtors), (b) item C.II.4 (other debtors) may be combined together with item C.II.5 (called up share capital not paid) and item C.II.6 (prepayments and accrued income) in a new item under the heading “others”, to be shown after the new item mentioned in head (a). (7) Of the items (shares in group undertakings etc.) required to be shown as sub-items of item C.III (investments) under the general heading “ASSETS” there need only be shown the item “shares in group undertakings” and the other items may be combined in a new item “other investments”, to be shown after “shares in group undertakings”. (8) The following items (required to be shown as sub-items of item C (creditors) under the general heading “LIABILITIES”) may be combined as follows— (a) item C.6 (amounts owed to group undertakings) may be combined with item C.7 (amounts owed to undertakings in which the company has a participating interest) in a new item under the heading “amounts owed to group undertakings and undertakings in which the company has a participating interest”, to be shown after the items for “bank loans and overdrafts” and “trade creditors”, and (b) item C.1 (debenture loans), item C.3 (payments received on account), item C.5 (bills of exchange payable), item C.8 (other creditors including taxation and social security) and item C.9 (accruals and deferred income) may be combined in a new item under the heading “other creditors” , to be shown after the new item mentioned in head (a>) (9) The items (pensions and similar obligations etc.) required to be shown as sub-items of item B (provisions for liabilities and charges) under the general heading “LIABILITIES” and the items (capital redemption reserve etc.) required to be shown as sub-items of item A.IV (other reserves) under the general heading “LIABILITIES” need not be shown. (5) With regard to the notes on the balance sheet formats set out in Section B of Part I to Schedule 4, a small company— (a) in the case both of Format 1 and of Format 2, need not comply with the requirements of note (5) if it discloses in the notes to its accounts the aggregate amount included under “debtors” (item C.II in Format 1 and item C.II under the general heading “ASSETS” in Format 2) falling due after more than one year, and (b) in the case of Format 2, need not comply with the requirements of note (13) if it discloses in the notes to its accounts the aggregate amount included under “creditors” (item C under the general heading “LIABILITIES”) falling due within one year and the aggregate amount falling due after one year. (6) A small company need not set, out in the notes to its accounts any information required by the following paragraphs of Schedule 4—