[ESTABLISHING A BUSINESS ENTITY IN ENGLAND] 165
The accounts must be prepared in accordance with a detailed format and contents specified by the Companies Act 2006. In general, all accounts filed with the Registrar of Companies must be audited, although there are exemptions available to small companies. Auditors Auditors to a company must be UK-qualified or have UK-recognised overseas qualifications. A company is entirely exempt from the audit requirement if it qualifies as a “small company,” i.e., at least two of the following conditions must be met: • annual turnover is not more than £10,200,000; • balance sheet total is not more than £5,100,000; or • the average numbers of employees is not more than 50, and the company must not be excluded from the “small companies’ regime.” Registers In addition to the filing of the information with the Registrar of Companies, English company law requires a company itself to maintain a number of registers, such as a register of members (or shareholders), register of directors etc. Further both companies and limited liability partnerships are also required to keep a register of people with significant control ( PSC Register ), recording details of anyone who has significant control over the company. For these purposes, “significant control” includes holding (directly or indirectly) more than 25% of the shares or voting rights in a company, having the right (directly or indirectly) to appoint or remove a majority of
the board of directors or otherwise having the right to exercise “significant influence or control” over a company. A company’s PSC register will be open to public inspection in the same way as the register of members. Any change in the person with significant control of the company must be recorded in the PSC register within 14 days of such change and confirmed with the Registrar of Companies within 14 days of the change being entered into the PSC register. A private company has the option of keeping certain registers, including the PSC Register, at Companies House, instead of separately maintaining its own registers. The requirement to keep certain registers is subject to change following the passing of the ECCTA 2023. Once the relevant sections have come into force a company will no longer be required to maintain a register of directors, a register of directors’ residential addresses, the register of secretaries and the PSC. Instead, it will be necessary to file certain information with at Companies House. As yet these changes have not come into force. Confirmation statement The company must deliver a confirmation statement to the Registrar of Companies each year. The confirmation statement is made by the company and confirms that the information held by Companies House (e.g. in relation to its share capital, shareholders, officers, and other corporate information) remains accurate and confirms that the intended future activities of the company are lawful. If the information held by the Registrar of Companies is out of date (because the appropriate filing has not been made) then the company must file the information needed to update its records before or at the same time as it delivers the confirmation
ILN Corporate Group – Establishing a Business Entity Series
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