---

Companies Bill [HL]

My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 228 to 244. I shall speak also to Amendments Nos. 247, 251 to 254, 258, 259, 261, 264, 266 to 272, 274 to 282, 285, 289 to 291, 293 to 295, 302 to 308, and 310 to 314. The 61 amendments in this group are mainly minor and technical improvements to the accounts and audit provisions of the Bill. I shall mention two of the more substantive changes that they make. If any noble Lord would like an explanation of the other amendments, I shall happily do my best to provide it. The most substantive change made by this group is to the accounts and audit requirements for certain small financial service companies. Twenty-three of these amendments achieve this change: the two key ones are Amendment No. 231, which amends Clause 366, and Amendment No. 289, which amends Clause 462. These amendments are deregulatory in that they will allow more small financial companies not to have their accounts audited, and to take advantage of less onerous accounting and reporting requirements. The noble Baroness, Lady Noakes, proposed an amendment in this area when we debated the Bill in Grand Committee. The Financial Services Authority has carried out a consultation and found strong support for deregulation. The Government are pleased to be making these amendments to reduce the reporting burden on small companies. Some 4,690 small companies—all those where the requirement to have an audit is not based on a European Union requirement—will be able to benefit, saving them some £15 million a year in total. In order to enable companies to benefit from these relaxations in accounting and auditing requirements as soon as possible, we have made regulations to make parallel amendments to the Companies Act 1985. These will allow companies to benefit from the exemptions for financial years ending on or after 31 December 2006. I want to focus particularly on preliminary statements. Five of these amendments—Amendments Nos. 251 to 254 and 277—remove what would have been a new requirement for quoted companies to disclose on a website the preliminary statements that they are required to produce. Those amendments were prompted by a recent consultation by the Financial Services Authority on whether to change the regime for preliminary statements of annual results from a mandatory to a permissive one. We have concluded that the requirements on publication of preliminary statements are more properly a matter for securities law—just as what those statements must contain is—and those requirements should not be unnecessarily duplicated in company law. FSA disclosure rules require an issuer to keep for one year on its websites all price-sensitive information published through a regulated information provider. In the FSA’s experience, it would be unusual for a company to come to the conclusion that there was no price-sensitive information contained in any future preliminary statements that it produced. Consequently, the FSA expects that companies will put their preliminary statements on their websites anyway. As I have said, the remaining 33 amendments are more minor and technical, though I shall be happy to seek to explain them if that would be helpful. Moved, That the House do agree with the Commons in their Amendments Nos. 228 to 244.—(Lord McKenzie of Luton.) On Question, Motion agreed to.