Legalize / United Kingdom / Public General Act

Building Societies Act 1986

Type Public General Act

Publication 1986-07-25

Last updated 2025-01-06

State In force

Department Statute Law Database

Source legislation.gov.uk

articles 16

Reform history JSON API

(8) The voting of a person in an electronic ballot is electronic if—

(a) a person has access on a web site to the notice of the electronic ballot, any document which is required to accompany the notice and a facility for registering his vote;

(b) that person registers his vote by means of that facility; and

(9) The conditions of this sub-paragraph are satisfied if—

(a) the society and the person have agreed that notices of electronic ballots, any document which is required to accompany the notice, and a voting facility may be accessed by him on a web site;

(b) that agreement applies to the electronic ballot and accompanying documents in question;

(i) the publication of the notice and documents and the availability of the voting facility on a web site,

(ii) the address of that web site, and

(iii) the place on that web site where the notice, any such documents, and the facility may be accessed, and how they may be accessed; and

(d) the notice and each such document continues to be published and the facility continues to be available on that web site throughout the period beginning with the giving of that notification and ending with the date which the society specifies as the final date for the registration of votes.

(10) A notice given for the purposes of sub-paragraph (9)(c) must—

(a) state that it concerns a notice of an electronic ballot given in accordance with this Act; and

(b) state whether the voting to be conducted by the electronic ballot is in an election or on a resolution or both.

(11) Nothing in sub-paragraph (9) shall invalidate an electronic ballot where—

(a) any notice or document that is required to be published, and any facility which is required to be made available, for the period mentioned in sub-paragraph (6)(d) is published or made available for a part, but not all, of that period, but

(b) the failure to publish that notice or document, or make that facility available, throughout that period is wholly attributable to circumstances which it would not be reasonable to have expected the society to prevent or avoid.

(12) Sub-paragraphs (3) to (7) of paragraph 33 apply, with the modification specified in subparagraph (13) below, in relation to notices of an electronic ballot as they apply in relation to notices of a postal ballot.

(13) Sub-paragraph (3) of paragraph 33 has effect as if the reference to the receipt of completed ballot papers included a reference to the registration of votes by means of a voting facility on a web site.

(14) For the purposes of sub-paragraph (3) of paragraph 33 (as applied to electronic ballots by sub-paragraph (13) above), in a case in which a person is notified for the purposes of subparagraph (9)(c), a notice of an electronic ballot is treated as given to a person on the day when notification is given in accordance with that sub-paragraph.

The matters for which provision is, subject to Part III of this Schedule, to be made are the following:

109A

(1) A land transaction effected by or in consequence of—

(a) an amalgamation of two or more building societies under section 93; or

(b) a transfer of engagements between building societies under section 94,

is exempt from charge for the purposes of stamp duty land tax.

(2) Relief under this section must be claimed in a land transaction return or an amendment of such a return.

(3) In this section—

“land transaction” has the meaning given by section 43(1) of the Finance Act 2003;

“land transaction return” has the meaning given by section 76(1) of that Act.

72A

(1) The directors of every building society shall prepare accounts for the society for each of its financial years.

72B

(1) Building Societies Act individual accounts must comprise –

(a) a balance sheet as at the last day of the financial year, and

(b) an income and expenditure account.

(2) The balance sheet must give a true and fair view of the state of affairs of the society as at the end of the financial year; and the income and expenditure account must give a true and fair view of the income and expenditure of the society for the financial year.

(3) Building Societies Act individual accounts must comply with the requirements of regulations made under section 72C as to the form and content of the balance sheet and income and expenditure account and additional information to be provided by way of notes to the accounts or otherwise.

(4) Where compliance with the provisions of those regulations, and the other provisions of this Act as to the matters to be included in a society’s individual accounts or in notes to those accounts, would not be sufficient to give a true and fair view, the necessary additional information must be given in the accounts or in a note to them.

(5) If in special circumstances compliance with any of those provisions is inconsistent with the requirement to give a true and fair view, the directors must depart from that provision to the extent necessary to give a true and fair view.

(6) Particulars of any such departure, the reasons for it and its effect must be given in a note to the accounts.

(7) The Treasury may by regulations–

(a) add to the classes of documents to be comprised in a society’s Building Societies Act individual accounts under subsection (1);

(b) make provision as to the matters to be included in any document so added;

(c) modify the requirements of this Part as to the matters to be stated in any document comprised in the society’s Building Societies Act individual accounts;

(d) reduce the classes of documents to be comprised in a society’s Building Societies Act individual accounts.

(8) Regulations under subsection (7)–

(a) may make different provision for different descriptions of society, and

(b) may include incidental and supplementary provisions.

(9) The power to make regulations under subsection (7) is exercisable by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

72C

(1) The Treasury shall by regulations make provision with respect to the form and contents of Building Societies Act individual accounts.

(2) The Treasury may by regulations make provision with respect to additional information to be contained in Building Societies Act individual accounts, whether in the form of notes or otherwise.

(3) Without prejudice to the generality of subsections (1) and (2), the regulations may—

(a) prescribe accounting principles and rules;

(b) require corresponding information for a preceding financial year;

(4) The power to make regulations under this section is exercisable by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.

72D

Where the directors of a building society prepare IAS individual accounts, they must state in the notes to those accounts that the accounts have been prepared in accordance with UK-adopted international accounting standards.

Application of winding up legislation to building societies.

72E

(1) If at the end of a financial year a building society has subsidiary undertakings, the directors, as well as preparing individual accounts for the year, shall prepare accounts for the year for the society and those undertakings taken as a whole.Those accounts are referred to in this Part as the society’s “group accounts”.

(2) The group accounts of certain societies are required by section 403(1) of the Companies Act 2006 to be prepared in accordance with UK-adopted international accounting standards (“IAS group accounts”).

(3) The group accounts of other societies may be prepared–

(a) in accordance with section 72F (“Building Societies Act group accounts”), or

(b) in accordance with UK-adopted international accounting standards (“IAS group accounts”).

72F

(1) Building Societies Act group accounts must comprise–

(a) a balance sheet dealing with the state of affairs of the building society and its subsidiary undertakings, and

(b) an income and expenditure account showing the income and expenditure for the society and its subsidiary undertakings.

(2) Building Societies Act group accounts must give a true and fair view 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 included in the group accounts as a whole, so far as concerns members of the society.

(3) Building Societies Act group accounts must comply with the requirements of regulations made under section 72G as to the form and content of the group accounts and additional information to be provided by way of notes to the accounts or otherwise.

(4) Where compliance with the provisions of those regulations, and the other provisions of this Act as to the matters to be included in a society’s group accounts or in notes to those accounts, would not be sufficient to give a true and fair view, the necessary additional information must be given in the accounts or in a note to them.

(5) If in special circumstances compliance with any of those provisions is inconsistent with the requirement to give a true and fair view, the directors must depart from that provision to the extent necessary to give a true and fair view.

(6) Particulars of any such departure, the reasons for it and its effect must be given in a note to the accounts.

(7) The Treasury may by regulations–

(a) add to the classes of documents to be comprised in a society’s Building Societies Act group accounts under subsection (1);

(b) make provision as to the matters to be included in any document so added;

(c) modify the requirements of this Part as to the matters to be stated in any document comprised in the society’s Building Societies Act group accounts; and

(d) reduce the classes of documents to be comprised in a society’s Building Societies Act group accounts.

(8) Regulations under subsection (7)–

(a) may make different provision for different descriptions of society, and

(b) may include incidental and supplementary provisions.

(9) The power to make regulations under subsection (7) is exercisable by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.

72G

(1) The Treasury shall by regulations make provision with respect to the form and contents of Building Societies Act group accounts.

(2) The Treasury may by regulations make provision with respect to additional information to be contained in Building Societies Act group accounts, whether in the form of notes or otherwise.

(3) Without prejudice to the generality of subsections (1) and (2), the regulations may—

(a) prescribe accounting principles and rules;

(b) require corresponding information for a preceding financial year;

(d) permit group accounts to be prepared in other than consolidated form.

(4) The power to make regulations under this section is exercisable by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

72H

Where the directors of a building society prepare IAS group accounts, they must state in the notes to those accounts that the accounts have been prepared in accordance with UK-adopted international accounting standards.

72I

(1) The directors of a building society that prepares group accounts must secure that the individual accounts of–

(a) the building society, and

(b) each of its subsidiary undertakings,

are all prepared using the same financial reporting framework, except to the extent that in their opinion there are good reasons for not doing so.

(2) Subsection (1) only applies to accounts of subsidiary undertakings which are required to be prepared under Part 15 of the Companies Act 2006.

(3) Subsection (1) does not require accounts of undertakings that are charities to be prepared using the same financial reporting framework as accounts of undertakings which are not charities.

(4) Subsection (1)(a) does not apply where the directors of a building society prepare IAS group accounts and IAS individual accounts.

(5) The directors of a society which has subsidiary undertakings must secure that, except where in their opinion there are good reasons against it, the financial year of each of its subsidiary undertakings coincides with the society’s own financial year.

72J

(1) The information specified in Schedule 10A must be given in notes to a building society’s annual accounts.

(2) In that Schedule—

Part 1 relates to emoluments and other benefits of directors and others, and to loans and other dealings in favour of directors and connected persons, and

Part 2 relates to information about the employees of a society.

(3) It is the duty of any director of a society, and any person who is or has at any time in the preceding five years been an officer of the society, to give notice to the society of such matters relating to himself as may be necessary for the purposes of Part 1 of Schedule 10A.

(4) A person who makes default in complying with subsection (3) commits an offence and is liable on summary conviction to a fine not exceeding level 3 on the standard scale.

(5) The Treasury may, by order, modify the provisions of Schedule 10A.

(6) An order under this section may—

(a) make consequential amendments of or repeals in other provisions of this Act;

(b) make such transitional or saving provisions as appear to the Treasury to be necessary or expedient;

(7) The power to make an order under this section is exercisable by statutory instrument but no such order shall be made unless a draft of it has been laid before and approved by a resolution of each House of Parliament.

(8) In this section “modify” includes amend, add to or repeal.

72K

(1) The information specified in Schedule 10B must be given in notes to a building society’s annual accounts.

(2) In the case of a building society whose directors are not required to prepare consolidated group accounts, the information specified in Part 1 of that Schedule must be given.

(3) In the case of a building society whose directors are required to prepare consolidated group accounts, the information specified in Part 2 of that Schedule must be given.

(4) The Treasury may, by order, modify the provisions of Schedule 10B.

(5) An order under this section may—

(a) make consequential amendments of or repeals in other provisions of this Act;

(b) make such transitional or saving provisions as appear to the Treasury to be necessary or expedient;

(6) The power to make an order under this section is exercisable by statutory instrument but no such order shall be made unless a draft of it has been laid before and approved by a resolution of each House of Parliament.

(7) In this section “modify” includes amend, add to or repeal.

75A

(1) The review required for the purposes of section 75(1) is a balanced and comprehensive analysis of—

(a) the development and performance of the business of the building society and its connected undertakings (if any) during the financial year, and

(b) the position of the building society and its connected undertakings (if any) at the end of that year,

consistent with the size and complexity of the business.

(2) The review must, to the extent necessary for an understanding of the development, performance or position of the business of the society and its connected undertakings (if any), include—

(a) analysis using financial key performance indicators, and

(b) where appropriate, analysis using other key performance indicators, including information relating to environmental matters and employee matters.

(3) The review must, where appropriate, include references to and additional explanations of amounts included in the annual accounts of the society.

(4) In this section “key performance indicators” means factors by reference to which the development, performance or position of the business of the society and any connected undertakings it has can be measured most effectively.

78A

(1) The auditor’s report must state the name of the auditor (or, where more than one person is appointed as auditor, all of their names) and be signed and dated.

(2) Where the auditor is an individual, the report must be signed by him.

(2A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) Where the auditor is a firm, the report must be signed by the senior statutory auditor in his own name, for and on behalf of the auditor.

(4) Where more than one person is appointed as auditor, the report must be signed by all those appointed.

81A

(1) If a building society publishes any of its statutory accounts, they must be accompanied by the relevant auditor’s report under section 78.

(2) A building society that is required to prepare group accounts for a financial year must not publish its statutory individual accounts for that year without also publishing with them its statutory group accounts.

(3) If a building society publishes non-statutory accounts, it must publish with them a statement indicating—

(a) that they are not the society’s statutory accounts,

(b) whether statutory accounts dealing with any financial year with which the non-statutory accounts purport to deal have been prepared,

(c) whether the society’s auditor has made a report under section 78 on the statutory accounts for any financial year, and

(d) whether any such auditor’s report —

(i) was qualified or unqualified, or included a reference to any matters to which the auditor drew attention by way of emphasis without qualifying the report, or

(ii) contained a statement under section 79(6) (failure to obtain necessary information and explanations);

and it must not publish with any non-statutory accounts any auditor’s report made under section 78.

(4) For the purposes of this section a building society is regarded as publishing a document if it publishes, issues or circulates it or otherwise makes it available for public inspection in a manner calculated to invite members of the public generally, or any class of members of the public, to read it.

(5) References in this section to a building society’s statutory accounts are to its annual accounts as required to be laid before the society under section 81; and references to the publication by a society of “non-statutory accounts” are to the publication of—

(a) any balance sheet or income and expenditure account relating to, or purporting to deal with, a financial year or part of a financial year of the society, or

(b) an account in any form purporting to be a balance sheet or income and expenditure account for the group consisting of the society and its subsidiary undertakings relating to, or purporting to deal with, a financial year or part of a financial year of the society,

otherwise than as part of the society’s statutory accounts or summary financial statement prepared under section 76.

(6) A building society which contravenes any provision of this section, and any officer of it who is in default, is guilty of an offence and liable on summary conviction to a fine not exceeding level 3 on the standard scale.

81B

(1) In this Part—

“annual accounts”, in relation to a building society, means—the individual accounts required by section 72A, andany group accounts required by section 72E,together with the notes to those accounts;

“income and expenditure account”, in relation to a society which prepares IAS accounts, includes an income statement or other equivalent financial statement required to be prepared by UK-adopted international accounting standards;

“UK-adopted international accounting standards” has the meaning given by section 474(1) of the Companies Act 2006;

“UK regulated market” has the meaning given in Article 2.1.13A of Regulation (EU) No. 600/2014 of the European Parliament and of the Council of 15 May 2014 and amending Regulation (EU) No. 648/2012.

(2) References in this Part to accounts giving a “true and fair view” are references—

(a) in the case of Building Societies Act individual accounts, to the requirement under section 72B that such accounts give a true and fair view;

(b) in the case of Building Societies Act group accounts, to the requirement under section 72F that such accounts give a true and fair view; and

(c) in the case of IAS accounts, to the requirement under UK-adopted international accounting standards that such accounts achieve a fair presentation.

Disclosures relating to directors, other officers and employees of society required in notes to accounts

Acquisition or establishment of a business.

Amalgamations.

Mergers; provisions supplementing ss. 93 and 94.

Protective provisions for specially formed successors.

Rights of second-named joint shareholders.

Provisions supplementary to sections 102B and 102C.

Meaning of “associated undertaking”

Commencement.

Meaning of “associated undertaking”

Commencement.

SCHEDULE 10A

Part 1 — Emoluments of and dealings with directors and other officers

Aggregate amount of director’s remuneration etc

1

(1) The following must be shown—

(a) the aggregate amount of salary and fees and sums paid by way of expenses allowance (so far as they are chargeable to United Kingdom tax) paid to or receivable by directors in respect of qualifying services;

(b) the aggregate amount of bonuses paid to or receivable by directors in respect of qualifying services;

(c) the aggregate amount of the estimated money value of any other benefits paid to or receivable by directors in respect of qualifying services otherwise than in cash;

(d) the aggregate of the amount of gains made by directors on the exercise of share options;

(e) the aggregate of the following–

(i) the amount of money paid to or receivable by directors under long-term incentive schemes in respect of qualifying services; and

(ii) the net value of assets (other than money and share options) received or receivable by directors under such schemes in respect of such services;

(f) the aggregate value of any society contributions paid, or treated as paid, to a pension scheme in respect of directors' qualifying services, being contributions by reference to which the rate or amount of any money purchase benefits that may become payable will be calculated;

(g) the aggregate amount of the increase during the financial year in the value of any accrued pension or accrued lump sum comprising defined benefits payable in respect of any qualifying services performed by directors during the financial year; and

(h) the total aggregate amounts in paragraphs (a) to (g).

(2) In this paragraph–

“accrued pension” and “accrued lump sum”, in relation to any pension scheme and any director, mean respectively the amount of the annual pension, and the amount of the lump sum, which would be payable under the scheme on his attaining normal pension age if–he had left the society’s service at the end of the financial year;there were no increase in the general level of prices in the United Kingdom during the period beginning with the end of that year and ending with his attaining that age;no question arose of any commutation of the pension or inverse commutation of the lump sum; andany amounts attributable to voluntary contributions paid by the director to the scheme, and any money purchase benefits which would be payable under the scheme, were disregarded;

“amount”, in relation to a gain made on the exercise of a share option means the difference between–the market price of the shares on the day on which the option was exercised, andthe price actually paid for the shares;

“collective money purchase benefit” has the meaning given in section 1 or 52 of the Pension Schemes Act 2021;

“defined benefits” means retirement benefits payable under a pension scheme which are not money purchase benefits;

“defined benefit scheme”, in relation to a director, means a pension scheme which is not a money purchase scheme;

“long-term incentive scheme” means any agreement or arrangement under which money or other assets may become receivable by a director and which includes one or more qualifying conditions with respect to service or performance which cannot be fulfilled within a single financial year; and for this purpose the following are disregarded–bonuses the amount of which falls to be determined by reference to service or performance within a single financial year;compensation for loss of office, payments for breach of contract and other termination payments; andretirement benefits;

“money purchase benefits”, in relation to a director, means—retirement benefits payable under a pension scheme the rate or amount of which is calculated by reference to payments made, or treated as made, by the director or by any other person in respect of the director and which fall within paragraph 1A; and collective money purchase benefits;

“money purchase scheme”, in relation to a director, means a pension scheme under which all of the benefits that may become payable to or in respect of the director are money purchase benefits;

“normal pension age”, in relation to any pension scheme and any director, means the age at which the director will first become entitled to receive a full pension on retirement of any amount determined without reduction to take account of its payment before a later age (but disregarding any entitlement to pension upon retirement in the event of illness, incapacity or redundancy);

“net value”, in relation to any assets received or receivable by a director, means value after deducting any money paid or other value given by the director in respect of those assets;

“qualifying services”, in relation to any person, means his services as a director of the society, and his services while director of the society–as director of any of its connected undertakings; orotherwise in connection with the management of the affairs of the society or any of its connected undertakings;

“shares” means shares (whether allotted or not) in any connected undertaking of the society, and includes a share warrant as defined by section 779(1) of the Companies Act 2006;

“share option” means a right to acquire shares;

“society contributions”, in relation to a pension scheme and a director, means any payments (including insurance premiums) made, or treated as made, to the scheme in respect of the director by a person other than the director;

“value”, in relation to shares received or receivable by a director on any day, means the market price of the shares on that day.

(3) For the purposes of this paragraph amounts paid or receivable or share options granted in respect of a person’s accepting office as a director are treated as amounts paid or receivable or share options granted in respect of his services as a director.

(4) Where a pension scheme provides for any benefits that may become payable to or in respect of any director to be whichever are the greater of –

(a) money purchase benefits as determined by or under the scheme; and

(b) defined benefits as so determined,

the society may assume for the purposes of this paragraph that those benefits will be money purchase benefits, or defined benefits, according to whichever appears more likely at the end of the financial year.

(5) For the purpose of determining whether a pension scheme is a money purchase or defined benefit scheme, any death in service benefits provided for by the scheme are disregarded.

Details of individual directors' remuneration etc

2

(1) There must be shown in respect of each director by name, so much of each of the relevant aggregates as is attributable to that director.

(2) In this paragraph “relevant aggregates” means the aggregates shown under paragraph 1(1)(a) to (h).

(3) Sub-paragraphs (2) to (5) of paragraph 1 apply for the purposes of this paragraph as they apply for the purposes of that paragraph.

Excess retirement benefits of directors and past directors

3

(1) Subject to sub-paragraph (2), there must be shown the aggregate amount of–

(a) so much of retirement benefits paid to or receivable by directors under pension schemes; and

(b) so much of retirement benefits paid to or receivable by past directors under such schemes,

as (in each case) is in excess of the retirement benefits to which they were respectively entitled on the relevant date.

(2) For the purposes of sub-paragraph (1) the relevant date is whichever is the later of

(a) the date on which the benefits first became payable;

(b) 27 March 1998; or

(c) the date on which the provisions of the Building Societies Act 1997 specified in Part 2 of the Schedule to the Building Societies Act 1997 (Commencement) (No.3) Order 1997, have come into force in accordance with Article 2 of that Order in relation to the society.

(3) Amounts paid or receivable under a pension scheme need not be included in the aggregate amount if –

(a) the funding of the scheme was such that the amounts were or, as the case may be, could have been paid without recourse to additional contributions; and

(b) amounts were paid to or receivable by all pensioner members of the scheme on the same basis,

and in this sub-paragraph “pensioner member”, in relation to a pension scheme, means any person who is entitled to the present payment of retirement benefits under the scheme.

(4) In this paragraph–

(a) references to retirement benefits include benefits otherwise than in cash; and

(b) in relation to so much of retirement benefits as consists of a benefit otherwise than in cash, references to their amount are to the estimated money value of the benefit,

and the nature of any such benefit must also be disclosed.

Compensation to directors for loss of office

4

(1) There must be shown the amount of any compensation in respect of loss of office paid to or receivable by each director or past director by name, together with the aggregate amount of any such compensation.

(2) There must be shown the aggregate amount of any compensation referred to in sub-paragraph (1) in respect of the preceding financial year.

(3) The amounts referred to in sub-paragraph (1) include compensation received or receivable by a director or past director for–

(a) loss of office as director of the society, or

(b) loss, while director of the society or on or in connection with his ceasing to be a director of it, of–

(i) any other office in connection with the management of the society’s affairs, or

(ii) any office as director or otherwise in connection with the management of the affairs of any connected undertaking of the society.

(4) References in this paragraph–

(a) to compensation include benefits paid or receivable other than in cash; and

(b) to the amount of compensation are to the estimated money value of the benefit;

(5) The nature of any such compensation must be disclosed.

(6) In this paragraph, references to compensation for loss of office include the following–

(a) compensation in consideration for, or in connection with, a person’s retirement from office; and

(b) where such a retirement is occasioned by a breach of the person’s contract with the society or with a subsidiary undertaking of the society–

(i) payments made by way of damages for the breach; or

(ii) payments made by way of settlement or compromise of any claim in respect of the breach.

Sums paid to third parties in respect of directors' services

5

(1) There must be shown the aggregate amount of any consideration paid to or receivable by third parties for making available the services of any person–

(a) as a director of the society, or

(b) while director of the society–

(i) as director of any of its connected undertakings, or

(ii) otherwise in connection with the management of the affairs of the society or any of its connected undertakings.

(2) The reference in sub-paragraph (1) to consideration includes benefits paid or receivable other than in cash; and–

(a) the nature of any such consideration must be disclosed, and

(b) in relation to such consideration the reference to its amount is to the estimated money value of the benefit.

(3) The reference in sub-paragraph (1) to third parties is to persons other than –

(a) the director himself or a person connected with him or a body corporate associated with him, and

(b) the society or any of its connected undertakings.

Supplementary provisions regarding directors' remuneration

6

(1) The following applies with respect to the amounts to be shown under paragraphs 1 to 5.

(2) The amount in each case includes all relevant sums paid by or receivable from–

(a) the society;

(b) the society’s connected undertakings; and

except sums to be accounted for to the society or any of its connected undertakings.

(3) References to amounts paid to or receivable by a person include amounts paid to or receivable by a person connected with him or a body corporate associated with him (but not so as to require an amount to be counted twice).

7

(1) The amounts to be shown for any financial year under paragraphs 1 to 5 are the sums receivable in respect of that year (whenever paid) or, in the case of sums not receivable in respect of a period, the sums paid during that year.

(2) But where–

(a) any sums are not shown in a note to the accounts for the relevant financial year on the ground that the person receiving them is liable to account for them as mentioned in paragraph 6(2), but the liability is thereafter wholly or partly released or is not enforced within a period of 2 years; or

(b) any sums paid by way of expenses allowance are charged to United Kingdom income tax after the end of the relevant financial year,

those sums must, to the extent to which the liability is released or not enforced or they are charged as mentioned (as the case may be), be shown in a note to the first accounts in which it is practicable to show them and must be distinguished from the amounts to be shown apart from this provision.

8

(1) Where the chief executive of the society is not also a director of the society, he is deemed, for the purposes of paragraphs 1 to 7, to be a director of the society.

(2) In such circumstances there must be a note in the accounts specifying that the chief executive has been so deemed to be a director.

Interpretation of provisions regarding directors remuneration

9

(1) Sub-paragraphs (2) and (3) apply for the interpretation of paragraphs 1 to 8.

(2) For the purposes of paragraphs 1 and 2 a reference to a connected undertaking of the society is to any undertaking which is a connected undertaking at the time the services were rendered, and for the purposes of paragraph 4 is a reference to a connected undertaking immediately before the loss of office as a director.

(3) The following definitions apply–

(a) “pension scheme” has the meaning assigned to “retirement benefits scheme” by section 611 of the Income and Corporation Taxes Act 1988;

(b) “retirement benefits” has the meaning assigned to “relevant benefits” by section 612(1) and (2) of that Act.

(4) In paragraphs 5 and 6, references to a person being “connected” with a director, and to a director being “associated with” a body corporate, shall be construed in accordance with section 70 of this Act.

Directors' loans and transactions

10

(1) This paragraph applies, subject to sub-paragraph (4), in relation to–

(a) loans from and other transactions and arrangements with the society described in section 65 (which restricts loans to and other transactions and arrangements with directors and persons connected to them), other than those to which section 65(5) and (6) applies, and

(b) in the case of a society the directors of which are required to prepare consolidated group accounts, loans from and other transactions and arrangements with a subsidiary undertaking of the society to which paragraph (a) would apply were the society rather than the subsidiary undertaking a party to them.

(2) The notes to the annual accounts must contain a statement, in relation to such loans, transactions and arrangements, showing–

(a) the aggregate amounts outstanding under them at the end of the financial year; and

(b) the numbers of persons for whom such loans, transactions and arrangements were made.

(3) The notes to the annual accounts must, in relation to any loan, or other transaction or arrangement subsisting during or at the end of the financial year, make the following disclosures–

(a) where a copy of it or a memorandum of its terms is included in the register maintained under section 68, the existence of the register and the availability of requisite particulars from it for inspection must be disclosed;

(b) where it comes within paragraph (1)(b), its particulars must be disclosed unless it was one which would, had the subsidiary undertakings of the society formed part of the society, have been exempted from the obligations imposed by section 68.

(4) This paragraph applies in relation to loans to, and other transactions and arrangements with, a person connected with a director of the society where the society (or in the case of a subsidiary undertaking incorporated in the United Kingdom, the subsidiary undertaking) has notice of the connection between that director and that person.

Disclosure of auditors' remuneration

11

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

Persons who are to be regarded as associates of a society’s auditors

12

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

PART 2 — Information about employees

13

(1) The following information with respect to the employees of a building society must be given in notes to the society’s individual accounts–

(a) the average number of persons employed by the society in the financial year, and

(b) the average number of persons so employed within each category of persons employed by the society.

(2) The average number required by paragraph (1)(a) or (b) is determined by dividing the relevant annual number by the number of complete calendar months in the financial year.

(3) The relevant annual number is determined by ascertaining for each complete calendar month in the financial year–

(a) for the purposes of paragraph (1)(a), the number of persons employed under contracts of service by the society in that month (whether throughout the month or not);

(b) for the purposes of paragraph (1)(b), the number of persons in the category in question of persons so employed;

and, in either case, adding together all the monthly numbers.

(4) In respect of all persons employed by the society during the financial year who are taken into account in determining the relevant annual number for the purposes of paragraph (1)(a) there must also be stated the aggregate amounts respectively of–

(a) wages and salaries paid or payable in respect of that year to those persons;

(b) social security costs incurred by the society on their behalf; and

SCHEDULE 10B

PART 1 — Societies not required to prepare consolidated group accounts

Subsidiary undertakings

1

(1) The following information must be given where at the end of the financial year the society has subsidiary undertakings but is not required to prepare consolidated group accounts.

(2) The name of each subsidiary undertaking shall be stated.

(3) There must be stated with respect to each subsidiary undertaking–

(a) if it is incorporated outside the United Kingdom, the country in which it is incorporated;

(b) if it is unincorporated, the address of its principal place of business.

(4) The specific reason why each subsidiary undertaking is not required to be included in consolidated group accounts must be stated.

Holdings in subsidiary undertakings

2

(1) There must be stated in relation to shares of each class held by the society in a subsidiary undertaking–

(a) the identity of the class; and

(b) the proportion of the nominal value of the shares of that class represented by those shares.

(2) The shares held by or on behalf of the society itself must be distinguished from those attributed to the society which are held by or on behalf of a subsidiary undertaking.

Financial information about subsidiary undertakings

3

(1) There must be disclosed with respect to each subsidiary undertaking–

(a) the aggregate amount of its capital and reserves as at the end of its relevant financial year; and

(b) its profit or loss for that year.

(2) The information referred to in sub-paragraph (1) need not be given if the society’s investment in the subsidiary undertaking is included in the society’s accounts by way of the equity method of valuation or if–

(a) the subsidiary undertaking is not required by any provision of the Companies Act 2006 to deliver a copy of its balance sheet for its relevant financial year and does not otherwise publish that balance sheet in the United Kingdom or elsewhere, and

(b) the society’s holding is less than 50 per cent of the nominal value of the shares in the undertaking.

(3) Information otherwise required by this paragraph need not be given if it is not material–

(a) in the case of Building Societies Act accounts, for the purpose of giving a true and fair view for the society of the matters set out in section 72B(2) or, where appropriate section 72F(2), or

(b) in the case of IAS accounts, to the requirement under UK-adopted international accounting standards that such accounts achieve a fair presentation.

(4) For the purposes of this paragraph the “relevant financial year” of a subsidiary undertaking is–

(a) if its financial year ends with that of the society, that year, and

(b) if not, its financial year ending last before the end of the society’s financial year.

Financial years of subsidiary undertakings

4

Where—

(a) disclosure is made under paragraph 3(1) with respect to a subsidiary undertaking; and

(b) that undertaking’s financial year does not end with that of the society,

there must be stated in relation to that undertaking the date on which its last financial year before the end of the society’s financial year ended.

Significant holdings in undertakings other than subsidiary undertakings

5

(1) The information required by paragraphs 6 and 7 must be given where at the end of the financial year the society has a significant holding in an undertaking which is not a subsidiary undertaking of the society.

(2) A holding is significant for this purpose if–

(a) it amounts to 20 per cent or more of the nominal value of the shares in the undertaking; or

(b) the amount of the holding (as stated or included in the society’s accounts) exceeds one-fifth of the amount (as so stated) of the society’s assets.

6

(1) The name of the undertaking must be stated.

(2) There must be stated–

(a) if the undertaking is incorporated outside the United Kingdom, the country in which it is incorporated; and

(b) if it is unincorporated, the address of its principal place of business.

(3) There must also be stated–

(a) the identity of each class of shares in the undertaking held by the society; and

(b) the proportion of the nominal value of the shares of that class represented by those shares.

(4) Information otherwise required by this paragraph need not be given if it is not material–

(a) in the case of Building Societies Act accounts, for the purpose of giving a true and fair view for the society of the matters set out in section 72B(2) or ,where appropriate, section 72F(2), or

(b) in the case of IAS accounts, to the requirement under UK-adopted international accounting standards that such accounts achieve a fair presentation.

7

(1) There must also be stated–

(a) the aggregate amount of the capital and reserves of the undertaking as at the end of its relevant financial year, and

(b) its profit or loss for that year.

(2) That information need not be given if the investment of the society in all undertakings in which it has a significant holding is shown, in aggregate, in the notes to the accounts by way of the equity method of valuation.

(3) That information need not be given in respect of an undertaking if

(a) the undertaking is not required by any provision of the Companies Act 2006 to deliver a copy of its balance sheet for its relevant financial year and does not otherwise publish that balance sheet in the United Kingdom or elsewhere, and

(b) the society’s holding is less than 50 per cent of the nominal value of the shares in the undertaking.

(4) Information otherwise required by this paragraph need not be given if it is not material–

(a) in the case of Building Societies Act accounts, for the purpose of giving a true and fair view for the society of the matters set out in section 72B(2) or, where appropriate, section 72F(2), or

(b) in the case of IAS accounts, to the requirement under UK-adopted international accounting standards that such accounts achieve a fair presentation.

(5) For the purposes of this paragraph the “relevant financial year” of an undertaking is –

(a) if its financial year ends with that of the society, that year, and

(b) if not, its financial year ending last before the end of the society’s financial year.

Construction of references to shares held by society

8

(1) References in this Part of this Schedule to shares held by a society shall be construed as follows.

(2) For the purposes of paragraphs 2 and 3–

(a) shares held by a subsidiary undertaking, or by a person acting on behalf of the society or a subsidiary undertaking are treated as if they were held by the society; but

(b) shares held on behalf of a person other than the society or a subsidiary undertaking are not treated as if they were held by the society.

(3) For the purposes of paragraphs 5 to 7–

(a) shares held on behalf of a society by any person are treated as if they were held by the society; but

(b) shares held on behalf of a person other than the society are not treated as if they were held by the society.

(4) For the purposes of paragraphs 2 to 7, shares held by way of security shall be treated as if they were held by the person providing the security –

(a) where apart from the right to exercise them for the purposes of preserving the value of the security, or of realising it, the rights attached to the shares are exercisable only in accordance with his instructions, and

(b) where the shares are held in connection with the granting of loans as part of normal business activities and apart from the right to exercise them for the purpose of preserving the value of the security, or of realising it, the rights attached to the shares are exercisable only in his interests.

PART 2 — Societies required to prepare consolidated group accounts

Subsidiary undertakings

9

(1) The following information must be given with respect to the undertakings that are subsidiary undertakings of the society at the end of the financial year.

(2) The name of each undertaking must be stated.

(3) There must be stated–

(a) if it is incorporated outside the United Kingdom, the country in which it is incorporated;

(b) if it is unincorporated, the address of its principal place of business.

(4) It must be stated whether the subsidiary undertaking is included in the consolidation and, if it is not, the reason for excluding it from the consolidation must be given.

(5) It must be stated with respect to each subsidiary undertaking of the society by virtue of which of the conditions specified in section 1162 of the Companies Act 2006 it is a subsidiary undertaking of the society.

(6) That information need not be given in relation to a subsidiary undertaking if—

(a) the relevant condition is that specified in subsection (2)(a) of that section, and

(b) the society that is its immediate parent undertaking (within the meaning of section 1162 of the Companies Act 2006) holds the same proportion of the shares in the undertaking as it holds voting rights.

Holdings in subsidiary undertakings

10

(1) The following information must be given with respect to the shares of a subsidiary undertaking held—

(a) by the society, and

(b) by the group,

and the information required under paragraphs (a) and (b) must (if different) be shown separately.

(2) There must be stated–

(a) the identity of each class of shares held, and

(b) the proportion of the nominal value of the shares of that class represented by those shares.

Financial information about subsidiary undertakings not included in the consolidation

11

(1) There must be shown with respect to each subsidiary undertaking not included in the consolidation–

(a) the aggregate amount of its capital and reserves as at the end of its relevant financial year, and

(b) its profit or loss for that year.

(2) The information referred to in sub-paragraph (1) need not be given if the group’s investment in the subsidiary undertaking is included in the accounts by way of the equity method of valuation or if –

(a) the subsidiary undertaking is not required by any provision of the Companies Act 2006 to deliver a copy of its balance sheet for its relevant financial year and does not otherwise publish that balance sheet in the United Kingdom or elsewhere, and

(b) the holding of the group is less than 50 per cent of the nominal value of the shares in the subsidiary undertaking.

(3) Information otherwise required by this paragraph need not be given if it is not material—

(a) in the case of Building Societies Act accounts, for the purpose of giving a true and fair view for the society and its subsidiary undertakings as a whole, of the matters set out in section 72F(2);

(b) in the case of IAS accounts, to the requirement under UK-adopted international accounting standards that such accounts achieve a fair presentation.

(4) For the purposes of this paragraph the “relevant financial year” of a subsidiary undertaking is –

(a) if its financial year ends with that of the society, that year, and

(b) if not, its financial year ending last before the end of the society’s financial year.

Associated undertakings

12

(1) The following information must be given where an undertaking included in the consolidation has an interest in an associated undertaking.

(2) The name of the associated undertaking must be stated.

(3) There must be stated–

(a) if the associated undertaking is incorporated outside the United Kingdom, the country in which it is incorporated, and

(b) if it is unincorporated, the address of its principal place of business.

(4) The following information must be given with respect to the shares of the associated undertaking held–

(a) by the society; and

(b) by the group,

and the information required under paragraphs (a) and (b) must (if different) be given separately.

(5) There must be stated–

(a) the identity of each class of shares in the associated undertaking held; and

(b) the proportion of the nominal value of the shares of that class represented by those shares.

Other significant holdings of society or group

13

(1) The information required by paragraphs 14 and 15 must be given where at the end of the financial year the society has a significant holding in an undertaking which is not one of its subsidiary undertakings and does not fall within paragraph 12 (associated undertakings).

(2) A holding is significant for this purpose if–

(a) it amounts to 20 per cent or more of the nominal value of the shares in the undertaking; or

(b) the amount of the holding (as stated or included in the society’s individual accounts) exceeds one-fifth of the amount of the society’s assets (as so stated).

14

(1) The name of the undertaking must be stated.

(2) There must be stated –

(a) if the undertaking is incorporated outside the United Kingdom, the country in which it is incorporated; and

(b) if it is unincorporated, the address of its principal place of business.

(3) There must also be stated–

(a) the identity of each class of shares in the undertaking held by the society; and

(b) the proportion of the nominal value of the shares of that class represented by those shares.

(4) The information otherwise required by this paragraph need not be given if it is not material—

(a) in the case of Building Societies Act accounts, for the purpose of giving a true and fair view for the society and its subsidiary undertakings as a whole, of the matters set out in section 72F(2);

(b) in the case of IAS accounts, to the requirement under UK-adopted international accounting standards that such accounts achieve a fair presentation.

15

(1) There must also be stated–

(a) the aggregate amount of the capital and reserves of the undertaking as at the end of its relevant financial year; and

(b) its profits or loss for that year.

(2) That information need not be given in respect of an undertaking if–

(a) the undertaking is not required by any provision of the Companies Act 2006 to deliver a copy of its balance sheet for its relevant financial year and does not otherwise publish that balance sheet in the United Kingdom or elsewhere, and

(b) the society’s holding is less than 50 per cent of the nominal value of the shares in the undertaking.

(3) Information otherwise required by this paragraph need not be given if it is not material—

(a) for the purpose of giving a true and fair view for the society and its subsidiary undertakings as a whole, of the matters set out in section 72F(2);

(b) in the case of IAS accounts, to the requirement under UK-adopted international accounting standards that such accounts achieve a fair presentation.

(4) For the purposes of this paragraph the “relevant financial year” of an undertaking is–

(a) if its financial year ends with that of the society, that year, and

(b) if not, its financial year ending last before the end of the society’s financial year.

16

(1) The information required by paragraphs 17 and 18 must be given where at the end of the financial year the group has a significant holding in an undertaking which is not a subsidiary undertaking of the society and does not fall within paragraph 12 (associated undertakings).

(2) A holding is significant for this purpose if–

(a) it amounts to 20 per cent or more of the nominal value of the shares in the undertaking; or

(b) the amount of the holding (as stated or included in the group accounts) exceeds one-fifth of the amount of the group’s assets (as so stated).

17

(1) The name of the undertaking must be stated.

(2) There must be stated–

(a) if the undertaking is incorporated outside the United Kingdom, the country in which it is incorporated; and

(b) if it is unincorporated, the address of its principal place of business.

(3) There must also be stated–

(a) the identity of each class of shares in the undertaking held by the group; and

(b) the proportion of the nominal value of the shares of that class represented by those shares.

(4) Information otherwise required by this paragraph need not be given if it is not material—

(a) for the purpose of giving a true and fair view for the society and its subsidiary undertakings as a whole, of the matters set out in section 72F(2);

(b) in the case of IAS accounts, to the requirement under UK-adopted international accounting standards that such accounts achieve a fair presentation.

18

(1) There must also be stated–

(a) the aggregate amount of the capital and reserves of the undertaking as at the end of its relevant financial year; and

(b) its profit or loss for that year.

(2) That information need not be given if–

(a) the undertaking is not required by any provision of the Companies Act 2006 to deliver a copy of its balance sheet for its relevant financial year and does not otherwise publish that balance sheet in the United Kingdom or elsewhere; and

(b) the holding of the group is less than 50 per cent of the nominal value of the shares in the undertaking.

(3) Information otherwise required by this paragraph need not be given if it is not material—

(a) for the purpose of giving a true and fair view for the society and its subsidiary undertakings as a whole, of the matters set out in section 72F(2);

(b) in the case of IAS accounts, to the requirement under UK-adopted international accounting standards that such accounts achieve a fair presentation.

(4) For the purposes of this paragraph the “relevant financial year” of an undertaking is–

(a) if its financial year ends with that of the society, that year, and

(b) if not, its financial year ending last before the end of the society’s financial year.

Construction of references to shares held by society or group

19

(1) References in this Part of this Schedule to shares held by the society or the group shall be construed as follows.

(2) For the purposes of paragraphs 10, 12(4) and (5) and 13 to 15–

(a) shares held on behalf of a society by any person are treated as if they were held by the society; but

(b) shares held on behalf of a person other than the society are not treated as if they were held by the society.

(3) References to shares held by the group are to any shares held by or on behalf of the society or any of its subsidiary undertakings; but shares held on behalf of a person other than the society or any of its subsidiary undertakings are not treated as if they were held by the group.

(4) Shares held by way of security are treated as if they were held by the person providing the security in the following cases–

(a) where apart from the right to exercise them for the purpose of preserving the value of the security, or of realising it, the rights attached to the shares are exercisable only in accordance with his instructions;

(b) where the shares are held in connection with the granting of loans as part of normal business activities and apart from the right to exercise them for the purpose of preserving the value of security, or of realising it, the rights attached to the shares are exercisable only in his interests.

Interpretation: general

20

In this Schedule, “group” means a building society and its subsidiary undertakings.

The matters for which provision is, subject to Part III of this Schedule, to be made are the following:

119A

(1) In this Act “associated undertaking”, in relation to a building society, means an undertaking (other than a subsidiary undertaking of the society)—

(a) in which the society (or the group of which the society is a member) holds a participating interest, and

(b) over whose operating and financial policy the society (or group) exercises a significant influence.

(2) A “participating interest” means an interest in the shares of the undertaking held on a long term basis for the purpose of securing a contribution to the activities of the society (or group) by the exercise of control or influence arising from or related to that interest.

(3) For this purpose—

(a) a holding of 20% or more of the shares of an undertaking is presumed to be a participating interest unless the contrary is shown;

(b) an “interest in shares” includes—

(i) an interest that is convertible into an interest in shares, and

(ii) an option to acquire shares or any such interest,

and an interest or option falls within sub-paragraph (i) or (ii) notwithstanding that the shares to which it relates are, until the conversion or the exercise of the option, unissued;

(4) A holding of 20% or more of the voting rights in an undertaking is presumed to result in the exercise of such influence as is mentioned in subsection (1)(b), unless the contrary is shown.

(5) For this purpose—

(a) the voting rights in an undertaking means the rights conferred on shareholders in respect of their shares or, in the case of an undertaking not having a share capital, on members, to vote on all, or substantially all, matters affecting the undertaking; and

(b) the provisions of paragraphs 5 to 11 of Schedule 7 to the Companies Act 2006 (rights to be taken into account and attribution of rights) apply in determining whether the society (or the group) holds 20% or more of the voting rights in an undertaking.

(6) References in this section to the group of which the society is a member at any time are to the undertakings that would fall to be included in the consolidation if consolidated group accounts were to be drawn up by the society at that time.

(7) An undertaking is not an “associated undertaking” of a building society for the purposes of this Act if, in such accounts, it would fall to be dealt with as a joint venture (that is, an undertaking managed jointly with one or more undertakings not included in the consolidation).

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

Class 1 and class 2 advances

Special provisions as regards investors.

Power to make prohibition orders.

Powers to petition for winding up etc.

The determination: notification, effect, appeal.

Variation and revocation of transfer directions

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

Rights of appeal.

Directors, etc, not to accept commissions in connection with loans.

Consistency of accounts

Auditor’s duties and powers .

Power to alter priorities on dissolution and winding up

Application of bank insolvency and administration legislation to building societies

Acquisition or establishment of a business.

Mergers; provisions supplementing ss. 93 and 94.

Protective provisions for specially formed successors.

Mergers; provisions supplementing ss. 93 and 94.

Consequences of false declaration.

Provisions supplementary to sections 102B and 102C.

Public file of the society.

The matters for which provision is, subject to Part III of this Schedule, to be made are the following:

72L

(1) If in any financial year—

(a) a building society is or has been party to arrangements that are not reflected in its balance sheet, and

(b) at the balance sheet date the risks or benefits arising from those arrangements are material,

72M

(1) The information specified in Schedule 10C must be given in notes to a building society’s annual accounts.

(2) The Treasury may, by order, modify the provisions of Schedule 10C.

(3) An order under this section may—

(a) make consequential amendments of or repeals in other provisions of this Act;

(b) make such transitional or saving provisions as appear to the Treasury to be necessary or expedient;

(4) The power to make an order under this section is exercisable by statutory instrument but no such order shall be made unless a draft of it has been laid before and approved by a resolution of each House of Parliament.

(5) In this section “modify” includes amend, add to or repeal.

78B

(1) The senior statutory auditor means the individual identified by the firm as senior statutory auditor in relation to the audit in accordance with the standards or guidance mentioned in section 504(1) of the Companies Act 2006.

(2) The person identified as senior statutory auditor must be eligible for appointment as auditor of the building society in question (see Chapter 2 of Part 42 of the Companies Act 2006).

(3) The senior statutory auditor is not, by reason of being named or identified as senior statutory auditor or by reason of his having signed the auditor’s report, subject to any civil liability to which he would not otherwise be subject.

78C

(1) The copy of the auditor’s report sent ... under section 81, and every copy of the auditor’s report that is published by or on behalf of the society, must—

(a) state the name of the auditor and (where the auditor is a firm) the name of the person who signed it as senior statutory auditor, or

(b) if the conditions in section 78D (circumstances in which names may be omitted) are met, state that a resolution has been passed and notified ... in accordance with that section.

(1A) If more than one person is appointed as auditor, the reference in subsection (1)(a) to the name of the auditor is to be read as a reference to the names of all the auditors.

(2) For the purposes of this section a building society is regarded as publishing the report if it publishes, issues or circulates it or otherwise makes it available for public inspection in a manner calculated to invite members of the public generally, or any class of members of the public, to read it.

(3) If a copy of the auditor’s report is sent to the FCA or published without the statement required by this section, an offence is committed by—

(a) the society, and

(b) every officer of the society who is in default.

(4) A person guilty of an offence under this section is liable on summary conviction to a fine not exceeding level 3 on the standard scale.

78D

(1) An auditor’s name and, where the auditor is a firm, the name of the person who signed the report as senior statutory auditor, may be omitted from—

(a) the copy of the report sent ... under section 81, and

(b) published copies of the report,

if the following conditions are met.

(2) The conditions are that the building society—

(a) considering on reasonable grounds that statement of the name would create or be likely to create a serious risk that the auditor or the senior statutory auditor, or any other person, would be subject to violence or intimidation, has resolved by an ordinary resolution that the name should not be stated, and

(b) has given notice of the resolution to the FCA and, if the society is a PRA-authorised person, the PRA , stating—

(i) the name of the society,

(ii) the financial year of the society to which the report relates, and

(iii) the name of the auditor and (where the auditor is a firm) the name of the person who signed the report as senior statutory auditor.

SCHEDULE10C

Disclosure required

1

(1) The following must be shown—

(a) the amount of any remuneration receivable by the society’s auditor , or an associate of the society’s auditor, for the auditing of the annual accounts, and

(b) the amount of any remuneration receivable in respect of the financial year by—

(i) the society’s auditor, or

(ii) any person who was, at any time during that financial year, an associate of the society’s auditor,

for the supply of other services to the society or any associate of the society.

(2) Where the remuneration includes benefits in kind, the nature and estimated money-value of those benefits must also be shown.

(3) Separate disclosure is required in respect of the auditing of the accounts in question and of each type of service specified in paragraph 2, but not in respect of each service falling within a type of service.

(4) Separate disclosure is required in respect of services supplied to the society and its subsidiaries on the one hand and to associated pension schemes on the other.

(5) Where more than one person has been appointed as a society’s auditor in respect of the financial year, separate disclosure is required in respect of the remuneration of each such person and his associates.

(6) Where a building society is required to prepare consolidated group accounts—

(a) those accounts must comply with sub-paragraph (1)(b) as if the undertakings included in the consolidation were a single building society, and

(b) the notes to the individual accounts of—

(i) the society, and

(ii) a subsidiary of the society, where the subsidiary is included in the group accounts and the statutory auditor is the same for both the society and the subsidiary,

do not have to disclose the information required by that provision if the notes state that the group accounts are so required.

Types of service

2

The types of service in respect of which disclosure is required are—

(a) the auditing of accounts of any associate of the society;

(b) audit-related assurance services;

(d) any taxation advisory services not falling within paragraph (c);

(e) internal audit services;

(f) any assurance services not falling within paragraphs (a) to (e);

(g) any services relating to corporate finance transactions entered into, or proposed to be entered into, by or on behalf of the society or any of its associates not falling within paragraphs (a) to (f);

(h) any other non-audit services.

Disclosure not required of remuneration for certain services provided by distant associate

3

(1) Disclosure is not required of remuneration receivable for the supply of services falling within paragraph 2(h) supplied by a distant associate of the society’s auditor where the total remuneration receivable for all of those services supplied by that associate does not exceed—

(a) £10,000, or

(b) 1% of the total audit remuneration received by the society’s auditor in the most recent financial year of the auditor which ended no later than the end of the financial year of the society to which the accounts relate.

(2) In sub-paragraph (1)(b)—

(a) “financial year of the auditor” means—

(i) the period of not more than 18 months in respect of which the auditor’s profit and loss account is required to be made up (whether by law or by or in accordance with the auditor’s constitution (if any)), or

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