HC Deb 08 March 1932 vol 262 cc1609-10
1 and 2. Sir ARTHUR MICHAEL SAMUEL

asked the President of the Board of Trade (1) what steps his Department takes, for the protection of the public, to ensure that auditors comply with Section 134 (1) of the Companies Act, 1929, which requires auditors to report on those accounts and balance sheets, certified by them, which include a profit and loss account issued to the shareholders;

(2) whether the companies department satisfies itself that auditors who sign certificates on balance sheets and accounts which include a profit and loss account issued to shareholders, and are lodged with the Board of Trade under Section 110 of the Companies Act, 1929, have complied with Section 134 (1) of that Act, which requires auditors to report on the accounts examined by them and on every balance sheet, or whether the Department accepts, as valid for Section 110, certificates of auditors who have not complied with the requirements of Section 134 (1)?

The PRESIDENT of the BOARD of TRADE (Mr. Runciman)

Section 134 (1) of the Companies Act, relates to the duties of auditors in reporting to the members of the company. The Act does not authorise the Department to take any steps to ensure that those duties are properly performed nor has the Department any official knowledge of the manner in which the auditors carry out those duties except in so far as Section 110 requires the filing with the Registrar of Companies of a copy of the auditors' report on the last audited balance sheet. In the very few cases where the report does not comply with Section 134 (1) the Registrar draws the attention of the company to the statutory provisions. I would, however, point out that it is primarily the responsibility of the shareholders to see that the auditors carry out their duties and that if the shareholders are dissatisfied they can appoint other auditors.

Sir A. M. SAMUEL

What is the use of complying with Section 110, if Section 134 is not complied with? The two are complementary.

Mr. RUNCIMAN

If the hon. Member will put a question on the Order Paper as to the virtues of Section 110, I will look into it.

Sir A. M. SAMUEL

I do not suggest that the Act has any virtues.