HC Deb 17 February 1978 vol 944 cc410-1W
Mr. Wakeham

asked the Secretary of State for Trade (1) whether he is satisfied that audited accounts prepared on the current work account basis are likely to conform to the Fourth Directive;

(2) whether he is satisfied that audited accounts prepared on the current cost accounts basis are likely to conform with the Fourth Directive.

Mr. Clinton Davis

The EEC draft Fourth Directive on company accounts contains, in Article 30, provisions which would allow the adoption of current cost accounting.

Mr. Wakeham

asked the Secretary of State for Trade (1) whether, in view of the fact that the Registrar of Companies is receiving for filing audited accounts of companies some of which are prepared on the historic cost convention basis, some of which are prepared on the current cost accounts basis and some of which are prepared using a combination of both methods, he will bring forward legislation to clear up the obvious confusion to creditors, investors and employees; and if he will make a statement;

(2) whether, in view of the fact that the Registrar of Companies is receiving for filing audited accounts of companies some of which are prepared on the historic cost convention basis, some on the current cost accounts basis and some using a combination of both methods, he will make a statement to clear up the confusion to creditors, investors and employees.

Mr. Clinton Davis

Accounts of companies are drawn up and audited in accordance with the Companies Acts and must give a true and fair view. No particular accounting convention is specified, but it is standard practice for companies to disclose in their accounts the accounting policies followed and to show the effects of a change in policies in the year in which the change occurs, and also for auditors to refer in their reports to the accounting conventions used in the accounts.

I think it would be desirable that, when changing from the historic cost convention

Berkshire Population 659,000 Machester Population 490,000
Rates per 1,000 population
Households assisted with:
1. Telephones … … … … … … 0.2 8.6
2. Televisions … … … … … … — 0.7
3. Personal aids … … … … … … 3.6 2.4
4. Adaptations to property … … … … 1.1 2.4
Net Households assisted … … … … 4.2 10.8
Persons assisted with holidays … … … … — 1.2
COMPARATIVE EXPENDITURE PER 1,000 OF THE POPULATION IN BERKSHIRE AND MANCHESTER
Berkshire Manchester
£ £
1. Telephones … … … … … … … 54.18 86.75
2. Televisions … … … … … … … 57.10 255.52
3. Personal Aids … … … … … … … 62.36 284.62
4. Adaptations to Property … … … … … 1.13 19.61