§ 180 Page 96, line 38, at beginning insert ("Subject to the qualification mentioned below").
§
181 Page 96, line 45, at end insert—
("The method chosen must be one which appears to the directors to be appropriate in the circumstances of the company").
§ Lord LyellMy Lords, I beg to move that this House doth agree with the Commons in their Amendments Nos. 180 and 181. These two amendments were made in Committee in another place and they meet an undertaking that was given in your Lordships' House on Report. I hope that the noble Lord, Lord Bruce of Donington, would agree that the accountancy bodies could be encapsulated into what he called the CCAB; I cannot exactly recall the name, but I refer to the Central Council of Accountancy Bodies. The undertaking was to discuss with the accountancy bodies their concern over the fact that the accounting standard dealing with stock valuation, while not ruling out the use of what is attractively known as the LIFO (last in, first out) method of valuing stock, which is expressly permitted by paragraph 27 of Schedule 1, would not normally be appropriate. The accountancy bodies were concerned that paragraph 27(1) might be read as giving directors absolute freedom to use the last in, first out method in any circumstances that they chose. These two amendments seek to dispel the fears which were expressed very strongly by the noble Lord, Lord Bruce, and by other members of the accountancy body. I beg to move.
§ Moved, That this House doth agree with the Commons in the said amendments.—(Lord Lyell.)
§ On Question, Motion agreed to.