HC Deb 08 July 1977 vol 934 cc711-2W
Mr. Trotter

asked the Secretary of State for Trade whether, in the light of the recent decision on current cost accounting of the Institute of Chartered Accountants in England and Wales, he will make a statement of the Govern ment's policy on this matter and, in par ticular, whether he considers that current cost accounting should be obligatory for (a) public limited companies, (b) publicly-owned corporations, (c) other limited companies and (d) other busi nesses, either instead of or in addition to industrial accounts; and to what ex tent the United Kingdom will be required to comply in this respect with EEC requirements.

Mr. Clinton Davis

The Government, like the Council of the Institute of Char tered Accountants in England and Wales, reaffirm their support for the early intro duction of a system of inflation account ing; they also reaffirm their desire that current cost accounting should become the basis for the preparation of company accounts as soon as practicable. They note that the Council, in its statement of 6th July, has recognised that there should be a reappraisal of the approach to the introduction of inflation accounting; and that the Council intends to urge the Accounting Standards Committee to hold further consultations with representatives of finance, commerce, industry and the Government. The Government welcome this approach.

The draft EEC fourth directive on company accounts, which is still under negotiation, will allow member States to introduce systems of inflation accounting, including current cost accounting, if they so wish.