HC Deb 05 April 1990 vol 170 cc802-3W
Mr. Austin Mitchell

To ask the Secretary of State for Trade and Industry whether he will take steps to ascertain the merchant banks which promote off-balance sheet financing schemes.

Mr. Redwood

No. I refer the hon. Member to the reply I gave him on 3 April.

Mr. Austin Mitchell

To ask the Secretary of State for Trade and Industry whether he will amend the Companies Acts to require the directors of a company to respond to the circumstances mentioned in the statements filed by auditors in accordance with section 390 of the Companies Act 1985.

Mr. Redwood

With effect from 1 April, section 390 has been replaced by section 394, which was inserted into the Companies Act 1985 by section 123 of the Companies Act 1989.

I have no plans for further legislation in this area. It is for the shareholders to decide what explanations from the directors may be called for in the light of statements made by a former auditor of their company.

Mr. Austin Mitchell

To ask the Secretary of State for Trade and Industry whether he will amend section 385 of the Companies Act 1985 to require directors or auditors to give an indication of the details of the audit tender to shareholders.

Mr. Redwood

No. The appointment of auditors by the general meeting gives shareholders the opportunity to seek details of the terms of the proposed appointment.

Mr. Austin Mitchell

To ask the Secretary of State for Trade and Industry whether he will seek to amend the Companies Acts in order to specify auditors' responsibilities in detail similar to those of directors of companies.

Mr. Redwood

Under the Companies Act 1985 it is the responsibility of the directors to prepare accounts and of auditors to report whether those accounts have been properly prepared in accordance with the Act and give a true and fair view. Parliament has only recently considered and amended, in the Companies Act 1989, the relevant detailed provisions of the 1985 Act and I see no need to reopen the matter.