§ Mr. WigginTo ask the Chancellor of the Exchequer (1) what plans he has to reform corporate accounting measures; [697531
(2) what (a) British and (b) EU legislation is in place regarding corporate accounting measures; and what plans the Government have to change that legislation. [69752]
§ Miss Melanie JohnsonI have been asked to reply.
The White Paper on Modernising Company Law, published on 16 July 2002, sets out the Government's proposals for modernising company accounting. Copies are available in the Libraries of both Houses.
The Fourth Council Directive 78/660/EC, the Seventh Council Directive 83/349/EEC, Directive 86/635/EEC and directive 91/674/EEC set out the requirements in respect of the preparation of annual and consolidated accounts of companies, banks and insurance undertakings. On 3 June 2002, the European Commission issued a draft directive designed to modernise the first three of these directives; negotiations commenced this month.
The European Regulation on International Accounting Standards was adopted on 7 June 2002. It requires companies admitted to trading on regulated markets in the EU to prepare their consolidated accounts on the basis of accounting standards issued by the International Accounting Standards Board, from January 2005. The regulation gives member states the option to extend its application to other companies; the Government intend to consult on this in due course.