HL Deb 07 November 1989 vol 512 cc609-11

37 Clause 17, page 31, line 45, leave out from beginning to end of line 39 on page 32 and insert—

'Special provisions for banking and insurance companies.

255.—(1) A banking or insurance company may prepare its individual accounts in accordance with Part I of Schedule 9 rather than Schedule 4.

(2) Accounts so prepared shall contain a statement that they are prepared in accordance with the special provisions of this Part relating to banking companies or insurance companies, as the case may be.

(3) In relation to the preparation of individual accounts in accordance with the special provisions of this Part relating to banking or insurance companies, the references to the provisions of Schedule 4 in section 226(4) and (5) (relationship between specific requirements and duty to give true and fair view) shall be read as references to the provisions of Part I of Schedule 9.

(4) The Secretary of State may, on the application or with the consent of the directors of a company which prepares individual accounts in accordance with the special provisions of this Part relating to banking or insurance companies, modify in relation to the company any of the requirements of this Part for the purpose of adapting them to the circumstances of the company.

This does not affect the duty to give a true and fair view.

Special provisions for banking and insurance groups.

255A.—(1) The parent company of a banking or insurance group may prepare group accounts in accordance with the provisions of this Part as modified by Part II of Schedule 9.

(2) Accounts prepared shall contain a statement that they are prepared in accordance with the special provisions of this Part relating to banking groups or insurance groups, as the case may be.

(3) References in this Part to a banking group are to a group where —

  1. (a) the parent company is a banking company, or
  2. (b) at least one of the undertakings in the group is an authorised institution under the Banking Act 1987 and the predominant activities of the group are such as to make it inappropriate to prepare group accounts in accordance with the formats in Part I of Schedule 4.

(4) References in this part to an insurance group are to a group where —

  1. (a) the parent company is an insurance company, or
  2. (b) the predominant activity of the group is insurance business and activities which are a direct extension of or ancillary to insurance business.

(5) In relation to the preparation of group accounts in accordance with the special provisions of this Part relating to banking or insurance groups, the references to the provisions of Schedule 4A in section227(5) and (6) (relationship between specific requirements and duty to give true and fair view) shall be read as references to those provisions as modified by Part II of Schedule 9.

(6) The Secretary of State may, on the application or with the consent of the directors of a company which prepares group accounts in accordance with the special provisions of this Part relating to banking or insurance groups, modify in relation to the company any of the requirements of this Part for the purpose of adapting them to the circumstances of the company.

Modification of disclosure requirements in relation to banking company or group.

255B.—(1) In relation to a company which prepares accounts in accordance with the special provisions of this Part relating to banking companies or groups, the provisions of Schedule 5 (additional disclosure; related undertakings) have effect subject to Part III of Schedule 9.

(2) in relation to a banking company, or the parent company of a banking company, the provisions of Schedule 6 (disclosure: emoluments and other benefits of directors and others) have effect subject to Part IV of Schedule 9.

Directors' report where accounts prepared in accordance with special provisions.

255C.—(1) The following provisions apply in relation to the directors' report of a company for a financial year in respect of which it prepares accounts in accordance with the special provisions of this Part relating to banking or insurance companies or groups.

(2) The information required to be given by paragraph 6, 8 or 13 of Part I of Schedule 9 (which is allowed to be given in a statement or report annexed to the accounts), may be given in the directors' report instead.

Information so given shall be treated far the purposes of audit as forming part of the accounts.

(3) The reference in section 234(1)(6) to the amount proposed to be carried to reserves shall be construed as a reference to the amount proposed to be carried to reserves within the meaning of Part I of Schedule 9.

(4) If the company takes advantage, in relation to its individual or group accounts, of the exemptions conferred by paragraph 27 or 28 of Part I of Schedule 9, paragraph 1 of Schedule 7 (disclosure of asset values) does not apply.

(5) The directors' report shall, in addition to complying with Schedule 7, also comply with Schedule 10 (which specifies additional matters to be disclosed).'.

Lord Trefgarne

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 37. I shall speak also to Amendments Nos. 38 to 40 and Nos. 367 to 372.

This series of amendments is perhaps more fearsome in length than in the nature of the changes it makes to the Bill. I shall comment briefly. Following the introduction of the Bill in your Lordships' House, my department held discussions with representatives of banking and insurance companies and the Bank of England on the detailed requirements of Clause 17 and the related Schedule 6. These followed earlier consultation in the course of the preparation of the Bill. Almost inevitably, on a topic such as this, a number of points of detail were raised. In making a relatively small number of changes in response to this, however, it was clear that the structure of this part of the Bill could be improved. The length of the amendments is very largely explained by that restructuring. I hope that that clear explanation will convince your Lordships.

Moved, That the House do agree with the Commons in the said amendment. —(Lord Trefgarne.)