Abbreviated accounts were formerly a simplified form of annual accounts that small qualifying companies could file under the Companies Act to cut costs and save time, while minimizing the disclosure of business information.
Alternative accounting rules under the Companies Act modify the historical-cost convention, allowing for the valuation of certain assets at current or market value.
Asset classification refers to the systematic categorization of assets on a balance sheet, distinguishing between fixed and current assets as mandated by the Companies Act and Financial Reporting Standard (FRS 102) in the UK and Republic of Ireland.
An auditors' report, also known as an audit report, is an official opinion issued by auditors appointed to examine the financial statements of a company or organization. The report provides an independent assessment of whether the financial statements present a 'true and fair view' of the company's financial performance and comply with regulatory requirements. It plays a crucial role in ensuring transparency and accountability in financial reporting.
Methods of presenting a balance sheet as set out in the Companies Act. Details the two formats available, vertical and horizontal, with specific disclosure requirements.
A 'Business Name' refers to the legal name under which a sole trader, partnership, limited liability partnership, or company conducts business activities. The selection of a business name is regulated by the Companies Act to prevent misleading names.
A company auditor examines the financial statements of a company to ensure accuracy and compliance with the Companies Act. Since 1989, appointment as a company auditor is restricted to registered auditors only.
A connected person refers to individuals or entities that are related to a director under the Companies Act, with implications for disclosure requirements.
Consolidated financial statements combine the financial records of a group of companies, providing a comprehensive view of the entire group's financial situation.
A consolidated profit and loss account (also known as a consolidated income statement) combines the individual profit and loss accounts of group entities, presenting a comprehensive view of the group's financial performance.
A corporation is a legal entity composed of individuals that acts as a single entity with distinct legal rights and liabilities, separate from its members. It can be created by various legal forms, and can either be composed of a single person or several individuals.
Corresponding amount refers to an amount in the published financial accounts of a limited company that relates to the previous financial year to provide a basis for comparison.
Defective Accounts refer to financial records that do not comply with legislative or accounting standards, necessitating revision as per the Companies Act.
An annual report by the directors of a company to its shareholders, which forms part of the accounts required to be filed with the Registrar of Companies under the Companies Act. It includes information on the company's activities, performance, future developments, and other crucial matters.
An employee report is a simplified version of the statutory annual report and accounts of a company, designed specifically for its employees. Although voluntary, this practice should comply with provisions of the Companies Act relating to non-statutory accounts.
Under specific regulations such as the Companies Act and applicable financial reporting standards in the UK and the Republic of Ireland, certain parent companies may be exempt from preparing consolidated financial statements.
The method of presenting financial statements chosen by an organization. Incorporated bodies must use the formats prescribed by relevant legislative and regulatory frameworks, such as the Companies Act, for their balance sheet and profit and loss account.
Formation expenses pertain to the costs incurred in establishing a company. As mandated by the Companies Act, they should not be recorded as an asset of the company.
Incorporation is the process by which a company is officially registered and recognized as a legal entity separate from its owners, allowing it to own assets, incur liabilities, and engage in contracts.
The foundational element ensuring that auditors maintain their integrity and provide objective professional and business judgments in their work. Specific threats to this independence are extensive and regulated by both legislation and professional bodies.
The method of valuing current assets and work in progress as required by UK generally accepted accounting practice and the Companies Act; however they are measured in a company's management accounts.
A modification of the historical-cost convention in which certain assets are included at revalued amounts rather than their original cost. This approach is permitted under specific regulations such as the Companies Act.
A shareholding practice where shares are held in the name of a bank, stockbroker, company, or individual, rather than the beneficial owner, primarily to facilitate dealing or conceal the owner's identity.
Non-statutory accounts are financial statements issued by a company that do not form part of the statutory annual accounts required by law. These accounts are often reported in the media and are accompanied by a statement clarifying their non-statutory nature.
Learn about the 'Offer by Prospectus', a method of offering new shares or debentures to the public, including requirements, examples, FAQs, related terms, and further resources.
Donations for political or charitable purposes made by an organization. Under the Companies Act, a disclosure of such a donation has to be made by companies that are not wholly owned subsidiaries and have given in aggregate more than £200 in the financial year.
Detailed examination of the various formats for profit and loss accounts as prescribed by the Companies Act, including required disclosures and considerations for international comparability.
A company registered under the Companies Act as a public company, authorized to offer shares and securities to the public. A PLC has stricter regulatory requirements compared to private companies.
A Register of Charges is a statutory document maintained to record details of charges created by a company on its assets to secure debt. It is crucial for maintaining transparency and protecting creditor rights.
Relevant accounts are those financial statements that should be used to determine the amount of distributable profit of a company. These accounts are the most recent audited annual accounts of the company, prepared in compliance with the Companies Act.
A reporting accountant is responsible for providing financial information in a prospectus or reporting on small company accounts, primarily ensuring consistency with accounting records and legal provisions.
A binding decision made by the members of a company, either via voting at a general meeting or by unanimous informal consent, as recognized under UK company law and stipulated in the Companies Act or company articles.
A shadow director is an individual whose directions, typically, the board of directors of a company follow, although this individual is not officially appointed as a director. Certain legal provisions, particularly those under the Companies Act, hold shadow directors accountable in similar ways to formally appointed directors.
A small group is a classification under the Companies Act where specific size criteria meet and allow exemptions for certain financial reporting requirements.
Statutory accounts are mandatory financial statements that companies must prepare and file annually according to the legal requirements set by governing bodies, such as the Companies Act.
A statutory audit is an examination of a company’s financial statements and records, as mandated by regulatory bodies to ensure fairness and accuracy.
Statutory Books, as mandated by the Companies Act, ensure proper accounting records, enabling directors to accurately oversee the financial positioning and transactions of a company.
Undistributable reserves, often termed capital reserves, refer to specific reserves that cannot be distributed to shareholders as per the stipulations of the Companies Act, various statutes, or a company's constitutional documents. These reserves ensure the financial stability and compliance of a company.
