S.I. No. 294/1992 - European Communities (Credit Institutions : Accounts) Regulations, 1992.

S.I. No. 294 of 1992.

EUROPEAN COMMUNITIES (CREDIT INSTITUTIONS : ACCOUNTS) REGULATIONS, 1992.

TABLE OF CONTENTS

Regulations

1. Citation and Construction.

2. Interpretation.

3. Amendment of Act of 1986.

4. Date of Application.

5. Drawing up of Accounts.

6. Publication of Accounts in Full or Abbreviated Form.

7. Group Accounts.

8. Wholly-owned Subsidiaries.

9. Bank holding Companies.

10. Information on Related Undertakings.

11. Directors' Report.

12. Non-Application of Principal Act.

13. Auditors' Reports.

14. Publication of Accounts of Credit Institutions incorporated outside the State.

15. Offences.

SCHEDULE

Form and content of accounts of credit institutions and groups.

PART I—Individual accounts.

PART II—Form and content of group accounts.

PART III—Disclosure of information: related undertakings.

PART IV—Interpretation.

S.I. No. 294 of 1992.

EUROPEAN COMMUNITIES (CREDIT INSTITUTIONS : ACCOUNTS) REGULATIONS, 1992.

I, BERTIE AHERN, Minister for Finance, in exercise of the powers conferred on me by section 3 of the European Communities Act, 1972 (No. 27 of 1972), and for the purpose of giving effect to Council Directives 86/635/EEC of 8 December 1986¹ and 89/117/EEC of 13 February 1989² hereby make the following regulations:

1 Citation and Construction.

1. (1) These Regulations may be cited as the European Communities (Credit Institutions: Accounts) Regulations, 1992.

(2) These Regulations shall be construed as one with the Companies Acts, 1963 to 1990.

2 Interpretation.

2. (1) In these Regulations, unless the context otherwise requires—

"accounts" means the balance sheet, profit and loss account and any notes on the accounts or statements forming part of the accounts whether or not required by law;

"annual return" means the annual return made to the registrar of companies under the Principal Act;

"associated undertaking" has the same meaning as in the European Communities (Companies: Group Accounts) Regulations 1992, ( S.I. No. 201 of 1992 );

"the Bank" means the Central Bank of Ireland;

"the Directive" means Council Directive 86/635/EEC of 8 December 1986;

"the Principal Act" means the Companies Act, 1963 ;

"the Act of 1986" means the Companies (Amendment) Act, 1986 (No. 25 of 1986);

¹O.J. No. L372 of 31/12/1986

²O.J. No. L44 of 16/2/1989

"group accounts" means the accounts prepared in accordance with regulation 7;

"individual accounts" means the accounts prepared in accordance with regulation 5;

"parent company" means a company that has subsidiaries;

"section 2 (2) company" means any company incorporated in the State and referred to in subsection (2) (other than paragraph (b)) of section 2 of the Act of 1986;

"section 2 (2) parent company" has the meaning assigned to it by regulation 7 (1);

"undertaking" and "subsidiary undertaking" have the same meanings as in the European Communities (Companies: Group Accounts) Regulations, 1992.

(2) A word or expression in these Regulations shall have the same meaning as in the Council Directive 86/635/EEC of 8 December 1986 unless the contrary is indicated.

(3) In these Regulations, unless the context otherwise requires, a reference to a regulation is to a regulation of these Regulations, a reference to a paragraph is to the paragraph of the Regulation, and a reference to a subparagraph is to the subparagraph of the paragraph, in which the reference occurs.

(4) In these Regulations, unless the context otherwise requires, a reference to a balance sheet or profit and loss account shall include a reference to any notes to or documents annexed to the accounts in question giving information which is required by any provision of the Companies Acts, 1963 to 1990, or these Regulations and required or allowed by any such provision to be given in a note to or a document annexed to a company's accounts.

(5) In these Regulations:

(i) a reference to directors shall be construed, in the case of an undertaking which does not have a board of directors, as a reference to the corresponding persons appropriate to such undertaking;

(ii) a reference to voting rights in an undertaking means the rights conferred on shareholders in respect of their shares or, in the case of an undertaking not having a share capital, or members, to vote at general meetings of the undertaking on all, or substantially all, matters;

(iii) in relation to an undertaking which does not have general meetings at which matters are decided by the exercise of voting rights, the references to holding a majority of the voting rights in an undertaking shall be construed as references to having the right under the constitution of the undertaking to direct the overall policy of the undertaking to alter the terms of its constitution.

3 Amendment of Act of 1986.

3. Section 7 (1) of the Act of 1986 is hereby amended by the deletion of subparagraph (a) (ii) and the insertion of the following subparagraph:—

"(ii) in the case of a company to which subsection (2) (other than paragraph (b)) of section 2 of this Act applies, a copy of the balance sheet and profit and loss account of the company drawn up in accordance with the European Communities (Credit Institutions: Accounts) Regulations, 1992,".

4 Date of Application.

4. These Regulations shall apply to the individual and group accounts of a section 2 (2) company drawn up in respect of every financial year beginning on or after the 1st day of January 1993 and the requirements of section 7 (1) (a) (ii) of the Act of 1986 shall come into operation on that date.

5 Drawing up of Accounts.

5. (1) Subject to paragraph (2), every balance sheet and profit and loss account of a section 2 (2) company laid before the annual general meeting of the company, pursuant to section 148 of the Principal Act, shall comply with the following requirements and section 149 (other than subsection (5) and, insofar as it relates to the said subsection (5), subsection (7)) of that Act shall not apply to any such balance sheet or profit and loss account:

( a ) every such balance sheet and profit and loss account shall comply with the provisions of the Schedule to these Regulations,

( b ) every such balance sheet of a company shall give a true and fair view of the state of affairs of the company as at the end of its financial year and every such profit and loss account of a company shall give a true and fair view of the profit or loss of the company for the financial year,

( c ) where a balance sheet or profit and loss account drawn up in accordance with subparagraph (a) would not provide sufficient information to comply with subparagraph (b), any necessary additional information shall be provided in that balance sheet or profit and loss account or in a note to the accounts,

( d ) where, owing to special circumstances, the preparation of accounts of a company in compliance with subparagraph (a) would prevent those accounts from complying with subparagraph (b) (even if additional information were provided under subparagraph (c)) the directors of the company shall depart from the requirements of the said Schedule in preparing those accounts insofar as is necessary in order to comply with that subparagraph,

( e ) where the directors of a company depart from the requirements of this regulation, they shall attach a note to the accounts of the company giving details of the particular departures made, the reasons therefor and the effect of those departures on the accounts,

and, accordingly, in the Companies Acts, 1963 to 1990, in relation to a company to which these Regulations applies—

(i) references to the said section 149 shall be construed as references to that section as modified by the provisions of these Regulations, and

(ii) references to the Sixth Schedule shall be construed as references to the corresponding provisions of the Schedule to these Regulations.

(2) Paragraph (1) shall not apply to the profit and loss account of a company if—

( a ) the company is a parent undertaking, and

( b ) the company is required to prepare and does prepare group accounts in accordance with these Regulations, and

( c ) the notes to the company's individual balance sheet show the company's profit and loss for the financial year determined in accordance with these Regulations.

(3) Where, in the case of a company, advantage is taken of paragraph (2), that fact shall be disclosed in a note to the individual and group accounts of the company.

(4) Subparagraph (b) of paragraph (1) overrides the requirements of the Schedule to these Regulations and all other requirements of the Companies Acts, 1963 to 1990, as to the matters to be included in the accounts of a company or in notes to those accounts and, accordingly, where a balance sheet or profit and loss account of a company drawn up in accordance with those requirements would not provide sufficient information to comply with the said subparagraph, any necessary additional information shall be provided in that balance sheet or profit and loss account or in a note to the accounts.

6 Publication of Accounts in Full or Abbreviated Form.

6. (1) Where a company publishes its full accounts, it shall also publish with those accounts any report in relation to those accounts by the auditors of the company under section 193 of the Companies Act, 1990 .

(2) Where a company publishes abbreviated accounts relating to any financial year, it shall also publish a statement indicating—

( a ) that the accounts are not the accounts copies of which are required to be annexed to the annual return,

( b ) whether the copies of the accounts so required to be so annexed have in fact been so annexed,

( c ) whether the auditors of the company have made a report under section 193 of the Companies Act, 1990 , in respect of the accounts of the company which relate to any financial year with which the abbreviated accounts purport to deal,

( d ) whether the report of the auditors under the said section 193 contained any qualifications as to the matters mentioned in that section.

(3) Where a company publishes abbreviated accounts, it shall not publish with those accounts any such report of the auditors as is mentioned in paragraph (2) (c).

(4) Where a company publishes its full individual accounts for a financial year it shall indicate if group accounts have been prepared and if so where those group accounts can be obtained.

(5) In this regulation—

"abbreviated accounts", in relation to a company, means any balance sheet or profit and loss account, or summary or abstract of a balance sheet or profit and loss account, relating to a financial year of the company which is published by the company otherwise than as part of the full accounts of the company for that financial year and, in relation to a parent company, includes an account in any form purporting to be a balance sheet or profit and loss account, or a summary or abstract of a balance sheet or profit and loss account, of the group consisting of the parent company and its subsidiaries;

"company" means a section 2 (2) company;

"full accounts" means the individual or group accounts required to be annexed to the annual return;

"publish", in relation to a document, includes issue, circulate or otherwise make it available for public inspection in a manner calculated to invite the public generally, or any class of members of the public, to read the document, and cognate words shall be construed accordingly.

7 Group Accounts.

7. (1) This regulation applies to a parent company which is a section 2 (2) company (in these Regulations referred to as a "section 2 (2) parent company") whether or not it is itself a subsidiary of another undertaking.

(2) A company to which this regulation applies shall not be entitled to take advantage of section 154 of the Principal Act in relation to the preparation of group accounts or of subsections (2) or (3) of section 151 of the Principal Act in relation to the form of group accounts.

(3) Every parent company to which this regulation applies shall, subject to paragraph (5), prepare group accounts at the end of its financial year dealing with the state of affairs and profit or loss of the company and its subsidiaries (including those in liquidation and those with registered offices outside the State) in accordance with the provisions of Part I of the Schedule to these Regulations, as modified by Part II of the Schedule, and every such group accounts shall be laid before the next annual general meeting of the company at the same time as the individual accounts of the company are so laid and shall be annexed to the annual return of the company.

(4) The report of the auditors on the group accounts laid before the annual general meeting shall be annexed to the annual return referred to in paragraph (3).

(5) (i) The group accounts laid before the annual general meeting of a company shall give a true and fair view of the state of affairs and profit or loss of the company and subsidiaries dealt with thereby as a whole, so far as concerns members of the company.

(ii) The group accounts shall comprise the consolidated balance sheet dealing with the state of affairs of the parent and its subsidiaries as a whole, the consolidated profit and loss account dealing with the profit and loss of the parent and its subsidiaries as a whole and the notes on the accounts giving the information required by these Regulations or otherwise provided by the company.

(iii) Where group accounts drawn up in accordance with paragraph (3) would not provide sufficient information to comply with subparagraph (i) of this paragraph, any necessary additional information shall be given in the group accounts or in a note to the accounts.

(iv) Where, owing to special circumstances, the preparation of group accounts in compliance with paragraph (3) would prevent those accounts from complying with subparagraph (i) of this paragraph (even if additional information were given under subparagraph (iii) of this paragraph), the directors of the parent company shall depart from the requirements of Parts I and II (other than paragraph 2 of Part II) of the Schedule to these Regulations in preparing these accounts insofar as it is necessary in order to comply with that paragraph.

(v) Where the directors of a parent company depart from the requirements of these Regulations in compliance with subparagraph (iv), they shall attach a note to the group accounts of the company giving details of the particular departures made, the reasons therefore and the effect of those departures on the accounts.

(6) Where a document annexed to the annual return under this regulation or Regulations 8, 9, 10 or 11 is in a language other than English or Irish, there shall be annexed to any such document a translation in the English or Irish language certified in the prescribed manner to be a correct translation.

(7) The annual and group accounts, if any, of a subsidiary undertaking excluded from group accounts by virtue of the application of paragraph 2 of Part II of the Schedule to these Regulations shall be attached to the group accounts, or annexed to the annual return, of the parent company.

(8) Paragraph (7) shall not apply where the subsidiary undertaking has otherwise annexed the relevant accounts referred to in that paragraph to its annual return.

8 Wholly-owned Subsidiaries.

8. (1) Paragraph (3) of regulation 7 shall not apply to a section 2 (2) parent company which is itself a wholly-owned subsidiary of another undertaking established in a Member State of the Community ("the parent undertaking") if paragraph (3) of this regulation is complied with; provided that the fact that the advantage of this regulation is being availed of shall be disclosed in a note to the accounts of the section 2 (2) parent company annexed to its annual return under the Principal Act.

(2) In this regulation, a company shall be deemed to be a wholly-owned subsidiary of another if:

( a ) it would be so deemed for the purposes of section 150 of the Principal Act, or

( b ) that other holds 90 per cent or more of the shares in the company and the remaining shareholders in the company have approved the treatment of the company as a wholly-owned subsidiary under this regulation.

(3) The requirements referred to in paragraph (1) are as follows:

( a ) the company and its subsidiaries must be dealt with in group accounts prepared by the parent undertaking;

( b ) the group accounts and the group report of the parent undertaking must be prepared and audited in accordance with the Directive or Directive 83/349/EEC of 13 June 1983¹, as the case may be;

( c ) the following must be annexed to the annual return of the company next after the group accounts have been prepared in accordance with subparagraph (a):

(i) the group accounts referred to in subparagraph (b),

(ii) the group annual report referred to in subparagraph (b), and

(iii) the report of the person responsible for auditing the accounts referred to in subparagraph (b),

( d ) the notes on the annual accounts of the company must disclose:

(i) the name and registered office of the parent undertaking that draws up the group accounts referred to in subparagraph (b), and

¹O.J. No. L193 of 18/7/1983

(ii) the exemption from the obligation to draw up group accounts and a group annual report.

(4) The exemption does not apply to a company any of whose shares, debentures or other debt instruments are listed on a stock exchange in any Member State of the Community.

(5) The Minister may, after consultation with the Bank, require that additional information shall be provided in the consolidated accounts of the parent undertaking or the individual accounts of the section 2 (2) parent company referred to in paragraph (1) of this regulation in accordance with Article 9 of Directive 83/349/EEC.

(6) This regulation shall also apply to a section 2 (2) parent company not falling under the provisions of paragraph (2) of this regulation which is itself a subsidiary of a parent undertaking established in a Member State of the Community if the shareholders or members holding in total 10 per cent of the nominal value of the shares of the parent company concerned have not at any time that is not later than six months before the end of the financial year in question requested the preparation of group accounts by that parent company in respect of that financial year.

9 Bank holding Companies.

9. (1) The obligation to prepare group accounts in accordance with regulation 7 also applies to a parent company:

(i) which does not itself carry on any material business apart from the acquisition, management and disposal of interests in subsidiaries; and

(ii) whose principal subsidiaries are wholly or mainly credit institutions.

(2) In paragraph (1), the management of interests in subsidiaries includes the provision of services to such subsidiaries and a parent company's principal subsidiaries are those subsidiaries of the company whose results or financial position would principally affect the figures shown in the group accounts.

10 Information on Related Undertakings.

10. (1) A company to which these Regulations apply shall give the information required by Part III of the Schedule to these Regulations by way of a note to its accounts or group accounts as the case may be.

(2) ( a ) Subject to subparagraph (b), the information specified in paragraph (1) may, in lieu of being stated in a note to the accounts of the company concerned for any particular financial year of the company, be given in a statement in writing signed by a director and the secretary of the company and annexed to the first annual return made by the company next after its accounts for that year are laid before the annual general meeting of the company if, in the opinion of the directors of the company, compliance with paragraph (1) would require a note to the accounts of the company of excessive length.

( b ) Subparagraph (a) shall not apply;

(i) in relation to information concerning a subsidiary of or an undertaking of substantial interest to a company (referred to subsequently in this subparagraph as the "second-mentioned company") if the financial state of that subsidiary or undertaking, as disclosed by its accounts, has, in the opinion of the directors of the second-mentioned company, a substantial effect on the profit or loss, or the amount of the assets, of the second-mentioned company and its subsidiaries, or

(ii) in relation to any subsidiary excluded from consolidated accounts by virtue of paragraph 2 of Part II of the Schedule to these Regulations.

( c ) A copy of a statement annexed, pursuant to subparagraph (a), to the annual return referred to in that subparagraph made by a company shall be certified both by a director and the secretary of the company to be a true copy of such statement.

(3) Section 16 of the Companies (Amendment) Act, 1986 , and subsections (4) and (5) of section 158 of the Principal Act shall not apply to a company to which this regulation applies.

(4) If advantage is taken of paragraph (2) (a), the company shall indicate that the information required by Part III of the Schedule to these Regulations to be given in the notes to the accounts refers only to the undertakings referred to in paragraph (2) (b) and that the full information required has been annexed to the annual return referred to in paragraph (2) (a).

(5) In this regulation, the expression "undertaking of substantial interest" means an undertaking falling within any of paragraphs 7, 18 or 19 of Part III of the Schedule to these Regulations.

11 Directors' Report.

11. In the case of a section 2 (2) parent company preparing group accounts in accordance with these Regulations, the report of the directors of that company under section 158 of the Principal Act, shall contain, in addition to the information specified in that section, the following information:

( a ) a fair review of the development of the business of the parent company and its subsidiary undertakings taken as a group during the financial year ending with the relevant balance sheet date;

( b ) particulars of any important events affecting the parent company or any of its subsidiary undertakings which have occurred since the end of that year;

( c ) an indication of likely future developments in the business of the parent company and its subsidiary undertakings, taken as a group;

( d ) an indication of the activities, if any, of the parent company and its subsidiary undertakings, taken as a group, in the field of research and development, and

( e ) the number and nominal value of shares in the parent company held by the company itself, by its subsidiary undertakings or by a person acting in his own name but on behalf of the company or subsidiary.

(2) The information required by subparagraph (1) (e) may be given in the notes to the group accounts.

12 Non-Application of Principal Act.

12. Sections 150 (1), and (2), 151 (1), 152, 158 (4), (5) and 6) and 191 of the Principal Act shall not apply to a company to which regulation 7 applies and the reference to subsection (1) in subsection (4) of section 150 shall be construed as a reference to regulation 7.

13 Auditors' Reports.

13. (1) The auditors of a section 2 (2) company shall make report to the members in accordance with section 193 of the Companies Act, 1990 , and the company shall not be entitled to rely on the exemption referred to in subsection (4) ( f ) of section 193 in relation to the preparation of its accounts.

(2) The report of the auditors shall also contain the information required by section 15 of the Companies (Amendment) Act, 1986 , in relation to both the individual and group accounts prepared by a company to which these Regulations apply.

14 Publication of Accounts of Credit Institutions incorporated outside the State.

14. (1) Every credit institution incorporated outside the State which has a place of business in the State shall publish its individual accounts and its group accounts, together with the report of the directors and auditors, in such manner as may be prescribed by the Bank in accordance with Article 44 of the Directive.

(2) In implementing the provisions of this regulation, the Bank shall apply the provisions of Directive 89/117/EEC of 13 February 1989¹ and, in particular, Articles 2, 3 and 4 thereof.

(3) This regulation shall also apply to any financial institution incorporated outside the State with a place of business in the State which would, if it were incorporated in the State, be subject to licensing or supervision by the Bank.

(4) In paragraph (3), "financial institution" does not include an insurance company or undertaking.

15 Offences.

15. (1) ( a ) If a company to which these Regulations apply fails to comply with a provision of these Regulations, the company and every officer of the company who is in default shall be liable on summary conviction to a fine not exceeding £1,000.

¹O.J. No. L44 of 16/2/1989

( b ) Proceedings for an offence under this regulation may be brought and prosecuted by the Bank or, in the case of a failure by a company to annex or attach any document required by these Regulations to be annexed or attached to the annual return of that company, by the registrar of companies.

(2) If any person, being a director of a company to which these Regulations apply, fails to take all reasonable steps to secure compliance with a requirement of these Regulations, he shall, in respect of each offence, be liable on summary conviction to imprisonment for a term not exceeding 12 months, or, at the discretion of the court, to a fine not exceeding £1,000, or to both.

(3) In any proceedings against a person for an offence under paragraph (2), it shall be a defence for a director to prove that he had reasonable grounds to believe and did believe that a competent and reliable person was charged with the duty of ensuring that the provisions of these Regulations were complied with and that the latter person was in a position to discharge that duty, and a person shall not be liable to be sentenced to imprisonment for an offence under the said paragraph (2) unless, in the opinion of the court, the offence was committed wilfully.

(4) If any person in any balance sheet, profit and loss account, report, note or other document required by or for the purposes of any provision of these Regulations wilfully makes a statement false in any material particular, knowing it to be false, he shall be liable on summary conviction, to imprisonment for a term not exceeding 12 months or to a fine not exceeding £1,000 or to both.

(5) In this section "director" and "officer" includes any person in accordance with whose instruction or directions the directors of the company are accustomed to act.

SCHEDULE

Regulation 5

FORM AND CONTENTS OF ACCOUNTS OF CREDIT INSTITUTIONS AND GROUPS

PART I

INDIVIDUAL ACCOUNTS

CHAPTER I

GENERAL RULES AND FORMATS

SECTION A

GENERAL RULES

1.—(1) Subject to the following provisions of this Part of this Schedule:

( a ) every balance sheet of a company shall show the items listed in the balance sheet format set out below in section B of this Chapter of this Schedule; and

( b ) every profit and loss account of a company shall show the items listed in either of the profit and loss account formats so set out;

in either case in the order and under the headings and sub-headings given in the format adopted.

(2) Subparagraph (1) above is not to be read as requiring the heading or sub-heading for any item to be distinguished by any number or letter assigned to that item in the format adopted.

2.—(1) Where in accordance with paragraph 1 a company's profit and loss account for any financial year has been prepared by reference to one of the formats set out in section B below, the directors of the company shall adopt the same format in preparing the profit and loss account for subsequent financial years of the company unless in their opinion there are special reasons for a change.

(2) Particulars of any change in the format adopted in preparing a company's profit and loss account in accordance with paragraph 1 shall be disclosed, and the reasons for the change shall be explained, in a note to the accounts in which the new format is first adopted.

3.—(1) Any item required in accordance with paragraph 1 to be shown in a company's balance sheet or profit and loss account may be shown in greater detail than so required.

(2) A company's balance sheet or profit and loss account may include an item representing or covering the amount of any asset or liability, income or expenditure not specifically covered by any of the items listed in the balance sheet format provided or the profit and loss account format adopted, but the following shall not be treated as assets in any company's balance sheet:

(i) preliminary expenses;

(ii) expenses of and commission on any issue of shares or debentures; and

(iii) costs of research.

(3) Items to which lower case letters are assigned in any of the formats set out in section B below may be combined in a company's accounts for any financial year if either:

( a ) their individual amounts are not material for the purpose of giving a true and fair view; or

( b ) the combination facilitates the assessment of the state of affairs or profit or loss of the company for that year;

but in a case within paragraph (b) the individual amounts of any items so combined shall be disclosed in a note to the accounts and any notes required by this Schedule to the items so combined shall, not withstanding the combination, be given.

(4) Subject to paragraph 4 (3) below, a heading or sub-heading corresponding to an item listed in the balance sheet format or the profit and loss account format adopted in preparing a company's balance sheet or profit and loss account shall not be included if there is no amount to be shown for that item in respect of the financial year to which the balance sheet or profit and loss account relates.

4.—(1) In respect of every item shown in the balance sheet or profit and loss account, there shall be shown or stated the corresponding amount for the financial year immediately preceding that to which the accounts relate.

(2) Where the corresponding amount is not comparable with the amount to be shown for the item in question in respect of the financial year to which the balance sheet or profit and loss account relates, the former amount shall be adjusted and particulars of the adjustment and the reasons for it shall be given in a note to the accounts.

(3) Paragraph 3 (4) does not apply in any case where an amount can be shown for the item in question in respect of the financial year immediately preceding that to which the balance sheet or profit and loss account relates, and that amount shall be shown under the heading or sub-heading required by paragraph 1 for that item.

5.—(1) Subject to the following provisions of this paragraph and without prejudice to note (6) to the balance sheet format, amounts in respect of items representing assets or income may not be set off against amounts in respect of items representing liabilities or expenditure (as the case may be), or vice versa.

(2) Charges required to be included in profit and loss account format 1, items 11 (a) and 11 (b) or format 2, items A7 (a) and A7 (b) may however be set off against income required to be included in format 1, items 12 (a) and 12 (b) or format 2, items B5 (a) and B5 (b) and the resulting figure shown as a single item (in format 2 at position A7 if negative and at position B5 if positive).

(3) Charges required to be included in profit and loss account format 1, item 13 or format 2, item A8 may also be set off against income required to be included in format 1, item 14 or format 2, item B6 and the resulting figure shown as a single item (in format 2 at position A8 if negative and at position B6 if positive).

6.—(1) Assets shall be shown under the relevant balance sheet headings even where the company has pledged them as security for its own liabilities or for those of third parties or has otherwise assigned them as security to third parties.

(2) A company shall not include in its balance sheet assets pledged or otherwise assigned to it as security unless such assets are in the form of cash in the hands of the company.

7. Assets acquired in the name of and on behalf of third parties shall not be shown in the balance sheet.

8. Every profit and loss account of a company shall show as additional items:

( a ) any transfer between the profit and loss account and reserves;

( b ) separately, the aggregate amount of any dividends paid and proposed to be paid;

( c ) any increase or reduction in the balance on the profit and loss account since the immediately preceding financial year;

( d ) the profit or loss brought forward at the beginning of the financial year; and

( e ) the profit or loss carried forward at the end of the financial year.

SECTION B

THE REQUIRED FORMATS FOR ACCOUNTS

PRELIMINARY

9.—(1) Reference in this Part of this Schedule to the balance sheet format or to profit and loss account formats are to the balance sheet format or profit and loss account formats set out below and references to the items listed in any of the formats are to those items read together with any of the notes following the formats for alternative positions for any particular items.

(2) The requirement imposed by paragraph 1 of this Part of this Schedule to show the items listed in any such format in the order adopted in the format is subject to any provision in the notes following the formats for alternative positions for any particular items.

10. A number in brackets following any item in any of the formats set out below is a reference to the note of that number in the notes following the formats.

BALANCE SHEET FORMAT

Assets

1. Cash and balances at central and post office banks (1)

2. Central Government bills and other bills eligible for refinancing with a central bank (20)

( a ) Exchequer bills and similar securities (2)

( b ) Other eligible bills (3)

3. Loans and advances to banks (4), (20)

( a ) Repayable on demand

( b ) Other loans and advances

4. Loans and advances to customers (5), 20

5. Debt securities and other fixed income securities (6), (20)

( a ) Issued by public bodies

( b ) Issued by other issuers

6. Equity shares and other variable-yield securities

7. Participating interests

8. Shares in group undertakings

9. Intangible fixed assets (7)

10. Tangible fixed assets (8)

11. Called up capital not paid (9)

12. Own shares (10)

13. Other assets

14. Called up capital not paid (9)

15. Prepayments and accrued income

Total Assets

LIABILITIES

1. Deposits by banks (11), (20)

( a ) Repayable on demand

( b ) With agreed maturity dates or periods of notice

2. Customer accounts (12), (20)

( a ) Repayable on demand

( b ) With agreed maturity dates or periods of notice

3. Debt securities in issue (13), (20)

( a ) Bonds and medium term notes

( b ) Others

4. Other liabilities

5. Accruals and deferred income

6. Provisions for liabilities and charges

( a ) Provisions for pensions and similar obligations

( b ) Provisions for tax

( c ) Other provisions

7. Subordinated liabilities (14), (20)

8. Called up share capital (15)

9. Share premium account

10. Reserves

( a ) Capital redemption reserved

( b ) Reserve for own shares

( c ) Reserves provided for by the articles of association

( d ) Other reserves

11. Revaluation reserve

12. Profit and loss account

Total Liabilities

OFF-BALANCE SHEET ITEMS

1. Contingent liabilities (16)

(1) Acceptances and endorsements

(2) Guarantees and assets pledged as collateral security (17)

(3) Other contingent liabilities

2. Commitments (18)

(1) Commitments arising out of sale and option to resell transactions (19)

(2) Other commitments

NOTES ON THE BALANCE SHEET FORMAT AND OFF-BALANCE SHEET ITEMS

(1) Cash and balances at central and post office banks (Assets item 1) Cash shall comprise all currency including foreign notes and coins. Only those balances which may be withdrawn without notice and which are deposited with central or post office banks of the country or countries in which the company is established shall be included in this item. All other claims on central banks must be shown under assets items 3 or 4.

(2) Central Government bills and other eligible bills: Exchequer bills and similar securities (Assets item 2 (a))

Central Government bills and similar securities shall comprise Exchequer bills and similar debt instruments issued by public bodies which are eligible for refinancing with central banks of the country or countries in which the company is established. Any bills or similar debt instruments not so eligible shall be included under Assets item 5, sub-item (a).

(3) Exchequer bills and other eligible bills: other eligible bills (Assets item 2 (b))

Other eligible bills shall comprise all bills purchased to the extent that they are eligible, under national law, for refinancing with the central banks of the country or countries in which the company is established.

(4) Loans and advances to banks (Assets item 3)

Loans and advances to banks shall comprise all loans and advances to domestic or foreign credit institutions made by the company arising out of banking transactions. However loans and advances to credit institutions represented by debt securities or other fixed income securities shall be included under Assets item 5 and not this item.

(5) Loans and advances to customers (Assets item 4)

Loans and advances to customers shall comprise all types of assets in the form of claims on domestic and foreign customers other than credit institutions. However loans and advances represented by debt securities or other fixed income securities shall be included under Assets item 5 and not this item.

(6) Debt securities and other fixed income securities (Assets item 5)

This item shall comprise transferable debt securities and any other transferable fixed income securities issued by credit institutions, other undertakings or public bodies. Debt securities and other fixed income securities issued by public bodies shall however only be included in this item if they may not be shown under Assets item 2.

Where a company holds its own debt securities these shall not be included under this item but shall be deducted from Liabilities item 3 (a) or (b), as appropriate.

Securities bearing interest rates that vary in accordance with specific factors, for example the interest rate on the inter-bank market or on the Euromarket, shall also be regarded as fixed income securities to be included under this item.

(7) Intangible fixed assets (Assets item 9)

This item shall comprise:

( a ) development costs;

( b ) concessions, patents, licenses, trade marks and similar rights and assets;

( c ) goodwill; and

( d ) payments on account.

Amounts shall, however, be included in respect of (b) only if the assets were acquired for valuable consideration or the assets in question were created by the company itself.

Amounts representing goodwill shall only be included to the extent that the goodwill was acquired for valuable consideration.

There shall be disclosed, in a note to the accounts, the amount of any goodwill included in this item.

(8) Tangible fixed assets (Assets item 10)

This item shall comprise:

—land and buildings;

—plant and machinery;

—fixtures and fittings, tools and equipment; and

—payments on account and assets in the course of construction.

There shall be disclosed in a note to the accounts the amount included in this item with respect to land and buildings occupied by the company for its own activities.

(9) Called up capital not paid (Assets item 11 and 14) The two positions shown for this item are alternatives.

(10) Own Shares (Assets item 12)

The nominal value of the shares held shall be shown separately under this item.

(11) Deposits by banks (Liabilities item 1)

Deposits by banks shall comprise all amounts arising out of banking transactions owed to other domestic or foreign credit institutions by the company. However liabilities in the form of debt securities and any liabilities for which transferable certificates have been issued shall be included under Liabilities item 3 and not this item.

(12) Customer accounts (Liabilities item 2)

This item shall comprise all amounts owed to creditors that are not credit institutions. However liabilities in the form of debt securities and any liabilities for which transferable certificates have been issued shall be shown under Liabilities item 3 and not this item.

(13) Debt securities in issue (Liabilities item 3)

This item shall include both debt securities and debts for which transferable certificates have been issued, including liabilities arising out of own acceptances and promissory notes. (Only acceptances which a company has issued for its own refinancing and in respect of which it is the first party liable shall be treated as own acceptances).

(14) Subordinated liabilities (Liabilities item 7)

This item shall comprise all liabilities in respect of which there is a contractual obligation that, in the event of winding up or bankruptcy, they are to be repaid only after the claims of other creditors have been met.

This item shall include all subordinated liabilities, whether or not a ranking has been agreed between the subordinated creditors concerned.

(15) Called up share capital (Liabilities item 8)

The amount of allotted share capital and the amount of called up share capital which has been paid up shall be shown separately.

(16) Contingent liabilities (Off-balance sheet item 1)

This item shall include all transactions whereby the company has underwritten the obligations of a third party.

Liabilities arising out of the endorsement of rediscontinued bills shall be included in this item. Acceptances other than own acceptance shall also be included.

(17) Contingent liabilities: Guarantees and assets pledged as collateral security (Off-balance sheet item 1 (2))

This item shall include all guarantee obligations incurred and assets pledged as collateral security on behald of third parties, particularly in respect of sureties and irrevocable letters of credit.

(18) Commitments (Off-balance sheet item 2)

This item shall include every irrevocable commitment which could give rise to a credit risk.

(19) Commitments: Commitments arising out of sale and option to resell transactions (Off-balance sheet item 2 (1))

This sub-item shall comprise commitments entered into by the company in the context of sale and option to resell transactions.

(20) Claims on, and liabilities to, undertakings in which a participating interest is held or group undertakings (Assets items 2 to 5, Liabilities items 1 to 3 and 7)

The following information must be given either by way of subdivision of the relevant items or by way of notes to the accounts.

The amount of the following must be shown for each of Assets items 2 to 5:

( a ) claims on group undertakings included therein; and

( b ) claims on undertakings in which the company has a participating interest included therein.

The amount of the following must be shown for each of Liabilities items 1, 2, 3 and 7:

(i) liabilities to group undertakings included therein; and

(ii) liabilities to undertakings in which the company has a participating interest included therein.

SPECIAL RULES

Subordinated assets

11.—(1) The amount of any assets that are subordinated must be shown either as a subdivision of any relevant asset item or in the notes to the accounts; in the latter case disclosure shall be by reference to the relevant asset item or items in which the assets are included.

(2) In the case of Assets items 2 to 5 in the balance sheet format, the amounts required to be shown by note (20) to the format as sub-items of those items shall be further subdivided so as to show the amount of any claims included therein that are subordinated.

(3) For this purpose, assets are subordinated if there is a contractual obligation to the effect that, in the event of winding up or bankruptcy, they are to be repaid only after the claims of other creditors have been met, whether or not a ranking has been agreed between the subordinated creditors concerned.

Syndicated loans

12.—(1) Where a company is a party to a syndicated loan transaction the company shall include only that part of the total loan which it itself has funded.

(2) Where a company is a party to a syndicated loan transaction and has agreed to reimburse (in whole or in part) any other party to the syndicate any funds advanced by that party or any interest thereon upon the occurrence of any event, including the default of the borrower, any additional liability by reason of such a guarantee shall be included as a contingent liability in off-balance sheet item 1, sub-item (2).

Sale and repurchase transactions

13.—(1) The following rules apply where a company is a party to a sale and repurchase transaction.

(2) Where the company is the transferor of the assets under the transaction:

( a ) the assets transferred shall, notwithstanding the transfer, be included in its balance sheet;

( b ) the purchase price received by it shall be included in its balance sheet as an amount owed to the transferee; and

( c ) the value of the assets transferred shall be disclosed in a note to its accounts.

(3) Where the company is the transferee of the assets under the transaction it shall not include the assets transferred in its balance sheet but the purchase price paid by it to the transferor shall be so included as an amount owed by the transferor.

Sale and option to resell transactions

14.—(1)The following rules apply where a company is a party to a sale and option to resell transaction.

(2) Where the company is the transferor of the assets under the transaction it shall not include in its balance sheet the assets transferred but it shall enter under off-balance sheet item 2 an amount equal to the price agreed in the event of repurchase.

(3) Where the company is the transferee of the assets under the transaction it shall include those assets in its balance sheet.

Managed funds

15.—(1) For the purpose of this paragraph "managed funds" are funds which the company administers in its own name but on behalf of others and to which it has legal title.

(2) The company shall, in any case where claims and obligations arising in respect of managed funds fall to be treated as claims and obligations of the company, adopt the following accounting treatment: claims and obligations representing managed funds are to be included in the company's balance sheet, with the notes to the accounts disclosing the total amount included with respect to such assets and liabilities in the balance sheet and showing the amount included under each relevant balance sheet item in respect of such assets or (as the case may be) liabilities.

PROFIT AND LOSS ACCOUNT FORMATS

FORMAT 1

Vertical layout

1. Interest receivable and similar income (1).

( a ) Interest receivable and similar income arising from debt securities and other fixed income securities.

( b ) Other interest receivable and similar income.

2. Interest payable and similar charges (2).

3. Dividend income.

( a ) Income from equity shares and other variable-yield securities.

( b ) Income from participating interests.

( c ) Income from shares in group undertakings.

4. Fees and commissions receivable (3).

5. Fees and commissions payable (4).

6. Dealing profits or losses (5).

7. Other operating income.

8. Administrative expenses.

( a ) Staff costs.

(i) Wages and salaries.

(ii) Social security costs.

(iii) Other pension costs.

( b ) Other administrative expenses.

9. Depreciation and amortisation (6).

10. Other operating charges.

11. Provisions.

( a ) Provisions for bad and doubtful debts (7).

( b ) Provisions for contingent liabilities and commitments (8).

12. Adjustments to provisions.

( a ) Adjustments to provisions for bad and doubtful debts (9).

( b ) Adjustments to provisions for contingent liabilities and commitments (10).

13. Amounts written off fixed assets investments (11).

14. Adjustments to amounts written off fixed asset investments (12).

15. Profit or loss on ordinary activities before tax.

16. Tax on profit or loss on ordinary activities.

17. Profit and loss on ordinary activities after tax.

18. Extraordinary income.

19. Extraordinary charges.

20. Extraordinary profit or loss.

21. Tax on extraordinary profit or loss.

22. Extraordinary profit or loss after tax.

23. Other taxes not shown under the preceding items.

24. Profit or loss for the financial year.

FORMAT 2

Horizontal layout

A. Charges

1. Interest payable and similar charges (2).

2. Fees and commission payable (4).

3. Dealing losses (5).

4. Administrative expenses.

( a ) Staff costs.

(i) Wages and salaries.

(ii) Social security costs.

(iii) Other pension costs.

( b ) Other administrative expenses.

5. Depreciation and amortisation (6).

6. Other operating charges.

7. Provisions.

( a ) Provisions for bad and doubtful debts (7).

( b ) Provisions for contingent liabilities and commitments (8).

8. Amounts written off fixed asset investments (11).

9. Profit on ordinary activities before tax.

10. Tax on profit or loss on ordinary activities.

11. Profit on ordinary activities after tax.

12. Extraordinary charges.

13. Tax on extraordinary profit or loss.

14. Extraordinary loss after tax.

15. Other taxes not shown under the preceding items.

16. Profit for the financial year.

B. Income

1. Interest receivable and similar income (1).

( a ) Interest receivable and similar income arising from debt securities and other fixed income securities.

( b ) Other interest receivable and similar income.

2. Dividend income.

( a ) Income from equity shares and other variable-yield securities.

( b ) Income from participating interests.

( c ) Income from shares in group undertakings.

3. Fees and commissions receivable (3).

4. Dealing profits (5).

5. Adjustments to provisions.

( a ) Adjustments to provisions for bad and doubtful debts (9).

( b ) Adjustments to provisions for contingent liabilities and commitments (10).

6. Adjustments to amounts written off fixed asset investments (12).

7. Other operating income.

8. Loss on ordinary activities before tax.

9. Loss on ordinary activities after tax.

10. Extraordinary income.

11. Extraordinary profit after tax.

12. Loss for the financial year.

NOTES ON THE PROFIT AND LOSS ACCOUNT FORMATS

(1) Interest receivable and similar income (Format 1, item 1; Format 2, item B1)

This item shall include all income arising out of banking activities, including:

( a ) income from assets included in Assets items 1 to 5 in the balance sheet format, however calculated;

( b ) income resulting from covered forward contracts, spread over the actual duration of the contract and similar in nature to interest; and

( c ) fees and commissions receivable similar in nature to interest and calculated on a time basis or by reference to the amount of the claim (but not other fees and commissions receivable).

(2) Interest payable and similar charges (Format 1, item 2; format 2, item A1)

This item shall include all expenditure arising out of banking activities, including:

( a ) charges arising out of liabilities included in Liabilities items 1, 2, 3 and 7 in the balance sheet format, however calculated;

( b ) charges resulting from covered forward contracts, spread over the actual duration of the contract and similar in nature to interest; and

( c ) fees and commissions payable similar in nature to interest and calculated on a time basis or by reference to the amount of the liability (but not other fees and commissions payable).

(3) Fees and commissions receivable (Format 1, item 4; Format 2, item B3)

Fees and commissions receivable shall comprise income in respect of all services supplied by the company to third parties, but not fees or commissions required to be calculated under interest receivable (Format 1, item 1 ; Format 2 ,item B1).

In particular the following fees and commissions receivable must be included (unless required to be included under interest receivable):

— fees and commissions for guarantees, loan administration on behalf of other lenders and securities transactions;

— fees, commissions and other income in respect of payment transactions, account administration charges and commissions for the safe custody and administration of securities;

— fees and commissions for foreign currency transactions and for the sale and purchase of coin and precious metals; and

— fees and commissions charged for brokerage services in connection with savings and insurance contracts and loans.

(4) Fees and commissions payable (Format 1, item 5; format 2, item 2A)

Fees and commissions payable shall comprise charges for all services rendered to the company by third parties but not fees or commissions required to be included under interest payable (Format 1; item 2; Format 2. item A1).

In particular the following fees and commissions payable must be included (unless required to be included under interest payable):

— fees and commissions for guarantees, loan administration and securities transactions;

— fees, commissions and other charges in respect of payment transactions, account administration charges and commission for the safe custody and administration of securities;

— fees and commissions for foreign currency transactions and for the sale and purchase of coin and precious metals; and

— fees and commissions for brokerage service in connection with savings and insurance contracts and loans.

(5) Dealing profits or losses (Format 1, item 6; Format 2, items B4 and A3)

This item shall comprise:

( a ) the net profit or net loss on transactions in securities which are not held as financial fixed assets together with amounts written off or written back with respect to such securities, including amounts written off or written back as a result of the application of paragraph 34 (1) below;

( b ) the net profit or loss on exchange activities, save in so far as the profit or loss is included in interest receivable or interest payable (Format 1, items 1 or 2; Format 2, items B1 or A1); and

( c ) the net profits and losses on other dealing operations involving financial instruments, including precious metals.

(6) Depreciation and amortisation (Format 1, item 9; Format 2, item A5)

This item shall comprise depreciation and other amounts written off in respect of balance sheet Assets items 9 and 10.

(7) Provisions: Provisions for bad and doubtful debts (Format 1, item 1 (a); Format 2, item 7 (a))

Provisions for bad or doubtful debts shall comprise charges for amounts written off and for provisions made in respect of loans and advances shown under balance sheet Assets items 3 and 4.

(8) Provisions: Provisions for contingent liabilities and commitments (Format 1, item 11 (b); Format 2, item A7 (b))

This item shall comprise charges for provisions for contingent liabilities and commitments of a type which would, if not provided for, be shown under off-balance sheet items 1 and 2.

(9) Adjustments to provisions: Adjustments to provisions for bad and doubtful debts (Format 1, item 12 (a); Format 2, item B5 (a))

This item shall include credits from the recovery of loans that have been written off, from other advances written back following earlier write offs and from the reduction of provisions previously made with respect to loans and advances.

(10) Adjustments to provisions: Adjustments to provisions for contingent liabilities and commitments (Format 1, item 12 (b); Format 2, item B5 (b))

This item comprises credits from the reduction of provisions previously made with respect to contingent liabilities and commitments.

(11) Amounts written off fixed assets investments (Format 12, item 13; Format 2, item A8)

Amounts written off fixed assets investments shall comprise amounts written off in respect of assets which are transferable securities held as financial fixed assets, participating interests and shares in group undertakings and which are included in Assets items 5 to 8 in the balance sheet format.

(12) Adjustments to amounts written off fixed asset investments (Format 1, item 14; Format 2, item B6)

Adjustments to amounts written off fixed assets investments shall include amounts written back following earlier write offs and provisions in respect of assets which are transferable securities held as financial fixed assets, participating interests and group undertakings and which are included in Assets items 5 to 8 in the balance sheet format.

CHAPTER II

ACCOUNTING PRINCIPLES AND RULES

SECTION A

ACCOUNTING PRINCIPLES

16. Subject to paragraph 22 below, the amounts to be included in respect of all items shown in a company's accounts shall be determined in accordance with the principles set out in paragraphs 17 to 21.

ACCOUNTING PRINCIPLES

17. The company shall be presumed to be carrying on business as a going concern.

18. Accounting policies shall be applied consistently within the same accounts and from one financial year to the next.

19. The amount of any item shall be determined on a prudent basis and, in particular:

( a ) only profits realised at the balance sheet date shall be included in the profit and loss account; and

( b ) all liabilities and losses which have arisen or are likely to arise in respect of the financial year to which the accounts relate or a previous financial year shall be taken into account, including those which only become apparent between the balance sheet date and the date on which it is signed on behalf of the board of directors in pursuance of section 156 of the Principal Act.

20. All income and charges relating to the financial year to which the accounts relate shall be taken into account, without regard to the date of receipt or payment.

21. In determining the aggregate amount of any item the amount of each individual asset or liability that falls to be taken into account shall be determined separately.

DEPARTURE FROM THE ACCOUNTING PRINCIPLES

22. If it appears to the directors of a company that there are special reasons for departing from any of the principles stated above in preparing the company's accounts in respect of any financial year they may do so, but particulars of the departure, the reasons for it and its effect on the accounts shall be given in a note to the accounts.

SECTION B

VALUATION RULES

HISTORICAL COST ACCOUNTING RULES

PRELIMINARY

23. Subject to paragraphs 39 to 44 of this part of this Schedule, the amounts to be included in respect of all items shown in a company's accounts shall be determined in accordance with the rules set out in paragraph 24 to 38 of this part of the Schedule.

FIXED ASSETS

General Rules

24. Subject to any provision for depreciation or diminution in value made in accordance with paragraph 25 or 26 the amount to be included in respect of any fixed assets shall be its cost.

25. In the case of any fixed asset which has a limited useful economic life, the amount of:

( a ) its cost, or

( b ) where it is estimated that any such asset will have a residual value at the end of the period of its useful economic life, its cost less that estimated residual value,

shall be reduced by provisions for depreciation calculated to write off that amount systematically over the period of the asset's useful economic life.

26.—(1) Where a fixed asset investment of a description falling to be included under Assets items 7 (participating interests) or 8 (shares in group undertakings) in the balance sheet format, or any other holding of securities held as a financial fixed asset, has diminished in value, provisions for diminution in value may be made in respect of it and the amount to be included in respect of it may be reduced accordingly; and any such provisions which are not shown separately in the profit and loss account shall be disclosed (either separately or in aggregate) in a note to the accounts.

(2) Provisions for diminution in value shall be made in respect of any fixed asset which has diminished in value if the reduction of its value is expected to be permanent (whether it's useful economic life is limited or not), and the amount to be included in respect of it shall be reduced accordingly; and any such provisions which are not shown separately in the profit and loss account shall be disclosed (either separately or in aggregate) in a note to the accounts.

(3) Where the reasons for which any provision was made in accordance with subparagraph (1) or (2) have ceased to apply to any extent, that provision shall be written back to the the extent that it is no longer necessary; and any amounts written back in accordance with this subparagraph which are not shown separately in the profit and loss account shall be disclosed (either separately or in aggregate) in a note to the accounts.

Development Costs

27.—(1) Notwithstanding that amounts representing "development costs" may be included under Assets item 9 in the balance sheet format, an amount may only be included in a company's balance sheet in respect of development costs in special circumstances.

(2) If any amount is included in a company's balance sheet in respect of development costs the following information shall be given in a note to the accounts—

( a ) the period over which the amount of those costs originally capitalised is being or is to be written off; and

( b ) the reasons for capitalising the development costs in question.

Goodwill

28.—(1) The application of paragraphs 24 to 26 in relation to goodwill (in any case where goodwill is treated as an asset) is subject to the following provisions of this paragraph.

(2) Subject to subparagraph (3) below the amount of the consideration for any goodwill acquired by a company shall be reduced by provisions for depreciation calculated to write off that amount systematically over a period chosen by the directors of the company.

(3) The period chosen shall not exceed the useful economic life of the goodwill in question.

(3) In any case where any goodwill acquired by a company is included as an asset in the company's balance sheet the period chosen for writing off the consideration for that goodwill and the reasons for choosing that period shall be disclosed in note to the accounts.

Intangible and tangible fixed assets

29. Assets included in Assets items 9 (Intangible fixed assets) and 10 (Tangible fixed assets) in the balance sheet format shall be valued as fixed assets.

Other fixed assets

30. Other assets falling to be included in the balance sheet shall be valued as fixed assets where they are intended for use on a continuing basis in the company's activities.

Financial fixed assets

31.—(1) Debts securities, including fixed income securities, held as financial fixed assets shall be included in the balance sheet at an amount equal to their maturity value plus any premium, or less any discount, on their purchase, subject to the following provisions of this paragraph.

(2) The amount included in the balance sheet with respect to such securities purchased at a premium shall be reduced each financial year on a systematic basis, in accordance with best accounting practices, so as to write the premium off over the period to the maturity date of the security and the amounts so written off shall be charged to the profit and loss account for the relevant financial years.

(3) The amount included in the balance sheet with respect to such securities purchased at a discount shall be increased each financial year on a systematic basis, in accordance with best accounting practices, so as to extinguish the discount over the period to the maturity date of the security and the amounts by which the amount is increased shall be credited to the profit and loss account for the relevant years.

(4) The notes to the accounts shall disclose the amount of any unamortised premium or discount not extinguished which is included in the balance sheet by virtue of subparagraph (1).

(5) For the purposes of this paragraph "premium" means any excess of the amount paid for a security over its maturity value.

CURRENT ASSETS

32. The amount to be included in respect of loans and advances, debt or other fixed income securities and equity shares or other variable yield not held as financial fixed assets shall be their cost, subject to paragraphs 33 and 34 below.

33.—(1) If the net realisable value of any asset referred to in paragraph 32 is lower than its cost the amount to be included in respect of that asset shall be the net realisable value.

(2) Where the reasons for which any provision for diminution in value was made in accordance with sub-paragraph (1) have ceased to apply to an extent that provision shall be written back to the extent that it is no longer necessary.

34.—(1) Subject to paragraph 33 above, the amount to be included in the balance sheet in respect of transferable securities not held as financial fixed assets may be the higher of their cost or their market value at the balance sheet date.

(2) The difference between the cost of any securities included in the balance sheet at a valuation under subparagraph (1) and their value shall be shown (in aggregate) in the notes to the accounts.

MISCELLANEOUS AND SUPPLEMENTARY PROVISIONS

Excess of money owed over value received as an asset item

35.—(1) Where the amount repayable on any debt owed by a company is greater than the value of the consideration received in the transaction giving rise to the debt, the amount of the difference may be treated as an asset.

(2) Where any such amount is so treated:

( a ) it shall be written off by reasonable amounts each year and must be completely written off before repayment of the debt; and

( b ) If the current amount is not shown as a separate item in the company's balance sheet it must be disclosed in a note to the accounts.

Determination of cost

36.—(1) The cost of an asset that has been acquired by the company shall be determined by adding to the actual price paid any expenses incidental to its acquisition.

(2) The cost of an asset constructed by the company shall be determined by adding to the purchase price of the raw materials and consumables used the amount of the costs incurred by the company which are directly attributable to the construction of that asset.

(3) In addition, there may be included in the cost of an asset constructed by the company:

( a ) a reasonable proportion of the costs incurred by the company which are only directly attributable to the construction of that asset, but only to the extent that they relate to the period of construction; and

( b ) interest on capital borrowed to finance the construction of that asset, to the extent that it accrues in respect of the period of construction;

provided, however, in a case within subparagraph (b) above, that the inclusion of the interest in determining the cost of that asset and the amount of the interest so included is disclosed in a note to the accounts.

37.—(1) Subject to the qualification mentioned below, the cost of any assets which are fungible assets (including investments) may be determined by the application of any of the methods mentioned in subparagraph (2) below in relation to any such assets of the same class.

The method chosen must be one which appears to the directors to be appropriate in the circumstances of the company.

(2) Those methods are:

( a ) the method known as "first in, first out" (FIFO);

( b ) a weighted average price; and

( c ) any other method similar to any of the methods mentioned above.

(3) Where in the case of any company:

( a ) the cost of assets falling to be included under any item shown in the company's balance sheet has been determined by the application of any method permitted by this paragraph; and

( b ) the amount shown in respect of that item differs materially from the relevant alternative amount given below in this paragraph;

the amount of that difference shall be disclosed in a note to the accounts.

(4) Subject to sub-paragraph (5) below, for the purposes of subparagraph (3) (b) above, the relevant alternative amount, in relation to any item shown in a company's balance sheet, is the amount which would have been shown in respect of that item if assets of any class included under that item at an amount determined by any method permitted by this paragraph had instead been included at their replacement cost as at the balance sheet date.

(5) The relevant alternative amount may be determined by reference to the most recent actual purchase price before the balance sheet date of assets of any class included under the item in question instead of by reference to their replacement cost as at that date, but only if the former appears to the directors of the company to constitute the more appropriate standard of comparison in the case of assets of that class.

Substitution of original amount where price or cost unknown.

38. Where there is no record of the purchase price of any asset acquired by a company or of any price, expenses or costs relevant for determining its cost in accordance with paragraph 36, or any such record cannot be obtained without unreasonable expense or delay, its cost shall be taken for the purposes or delay, its cost shall be taken for the purposes of paragraphs 24 to 34 to be the value ascribed to it in the earliest available record of its value made on or after its acquisition by the company.

ALTERNATIVE ACCOUNTING RULES

PRELIMINARY

39.—(1) The rules set out in paragraphs 24 to 38 are referred to below in this Schedule as the historical cost accounting rules.

(2) Paragraphs 24 to 27 and 31 to 35 are referred to below in this section of this Part of this Schedule as the depreciation rules; and references below in this Schedule to the historical cost accounting rules do not include the depreciation rules as they apply by virtue of paragraph 42.

40. Subject to paragraphs 42 to 44, the amounts to be included in respect of assets of any description mentioned in paragraph 41 may be determined on any basis so mentioned.

ALTERNATIVE ACCOUNTING RULES

41.—(1) Intangible fixed assets, other than goodwill, may be included at their current cost.

(2) Tangible fixed assets may be included at a market value determined as at the date of their last valuation or at their current cost.

(3) Investments of any description falling to be included under Assets items 7 (Participating interests) or 8 (Shares in group undertakings) of the balance sheet format and any other securities held as financial fixed assets may be included either:

( a ) at a market value determined as at the date of their last valuation; or

( b ) at a value determined on any basis which appears to the directors to be appropriate in the circumstances of the company;

but in the latter case particulars of the method of valuation adopted and of the reasons for adopting it shall be disclosed in a note to the accounts.

(4) Securities of any description not held as financial fixed assets (if not valued in accordance with paragraph 34 above) may be included at their current cost.

APPLICATION OF THE DEPRECIATION RULES

42.—(1) Where the value of any asset of a company is determined in accordance with paragraph 41, that value shall be, or (as the case may require) be the starting point for determining, the amount to be included in respect of that asset in the company's accounts, instead of its cost or any value previously so determined for that asset; and the depreciation rules shall apply accordingly in relation to any such asset with the substitution for any reference to its cost of a reference to the value most recently determined for that asset in accordance with paragraph 41.

(2) The amount of any provision for depreciation required in the case of any fixed asset by paragraph 25 or 26 as it applies by virtue of subparagraph (1) is referred to below in this paragraph as the "adjusted amount", and the amount of any provision which would be required by that paragraph in the case of that asset according to the historical cost accounting rules is referred to as the "historical cost amount".

(3) Where subparagraph (1) applies in the case of any fixed asset the amount of any provision for depreciation in respect of that asset included in any item shown in the profit and loss account in respect of amounts written off assets of the description in question may be the historical cost amount instead of the adjusted amount, provided that the amount of any difference between the two is shown separately in the profit and loss account or in a note to the accounts.

ADDITIONAL INFORMATION TO BE PROVIDED IN CASE OF DEPARTURE FROM HISTORICAL COST ACCOUNTING RULES

43.—(1) This paragraph applies where the amounts to be included in respect of assets covered by any items shown in a company's accounts have been determined in accordance with paragraph 41.

(2) The item affected and the basis of valuation adopted in determining the amounts of the assets in question in the case of each such item shall be disclosed in a note to the accounts.

(3) In the case of each balance sheet item affected either:

( a ) the comparable amounts determined according to the historical cost accounting rules; or

( b ) the differences between those amounts and the corresponding amounts actually shown in the balance sheet in respect of that item;

shall be shown separately in the balance sheet or in a note to the accounts.

(4) In sub-paragraph (3) above, references in relation to any item to the comparable amount determined as there mentioned are references to:

( a ) the aggregate amount which would be required to be shown in respect of that item if the amounts to be included in respect of all the assets covered by that item were determined according to the historical cost accounting rules; and

( b ) the aggregate amount of the cumulative provisions for depreciation or diminution in value which would be permitted or required in determining those amounts according to those rules.

REVALUATION RESERVE

44.—(1) With respect to any determination of the value of an asset of a company in accordance with paragraph 41, the amount of any profit or loss arising from that determination (after allowing, where appropriate, for any provisions for depreciation or diminution in value made otherwise than by reference to the value so determined and any adjustments of any such provisions made in the light of that determination) shall be credited or (as the case may be) debited to a separate reserve ("the revaluation reserve").

(2) The amount of the revaluation reserve shall be shown in the company's balance sheet under Liabilities item 11 in the balance sheet format, but need not be shown under that name.

(3) An amount may be transferred from the revaluation reserve:

( a ) to the profit and loss account, if the amount was previously charged to that account or represents realised profit, or

( b ) on capitalisation;

and the revaluation reserve shall be reduced to the extent that the amounts transferred to it are no longer necessary for the purposes of the valuation method used.

(4) In subparagraph (3) (b) "capitalisation", in relation to an amount standing to the credit of the revaluation reserve, means applying it in wholly or partly paying up unissued shares in the company to be allotted to members of the company as fully or partly paid shares.

(5) The revaluation reserve shall not be reduced except as mentioned in this paragraph.

(6) The treatment for taxation purposes of amounts credited or debited to the revaluation reserve shall be disclosed in a note to the accounts.

ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES

45.—(1) Subject to the following subparagraphs, amounts to be included in respect of assets and liabilities denominated in foreign currencies shall be in Irish pounds (or the currency in which the accounts are drawn up) after translation at an appropriate spot rate of exchange prevailing at the balance sheet date.

(2) An appropriate rate of exchange prevailing on the date of purchase may however be used for assets held as financial fixed assets and assets to be included under Assets items 9 (Intangible fixed assets) and 10 (Tangible fixed assets) in the balance sheet format, if they are not covered or not specifically covered in either the spot or forward currency markets.

(3) An appropriate spot rate of exchange prevailing at the balance sheet date shall be used for translating uncompleted spot exchange transactions.

(4) An appropriate forward rate of exchange prevailing at the balance sheet date shall be used for translating uncompleted forward exchange transactions.

(5) This paragraph does not apply to any assets of liabilities held, or any transactions entered into, for hedging purposes or to any assets or liabilities which are themselves hedged.

46.—(1) Subject to subparagraph (2), any difference between the amount to be included in respect of an asset or liability under paragraph 45 and the book value, after translation into Irish pounds (or the currency in which the accounts are drawn up) at an appropriate rate, of that asset or liability shall be credited or, as the case may be, debited to the profit and loss account.

(2) In the case, however, of assets held as financial fixed assets, of assets to be included under Assets item 9 (Intangible fixed assets) and 10 (Tangible fixed assets) in the balance sheet format and of transactions undertaken to cover such assets, any such difference may be deducted from or credited to any non-distributable reserve available for the purpose.

CHAPTER III

NOTES TO THE ACCOUNTS

PRELIMINARY

47. Any information required in the case of a company by the following provisions of this Part of this Schedule shall be given by way of a note to the accounts, unless otherwise provided.

GENERAL

Disclosure of accounting policies

48. The accounting policies adopted by the company in determining the amounts to be included in respect of items shown in the balance sheet and in determining the profit or loss of the company shall be stated (including such policies with respect to the depreciation and diminution in value of assets).

49. If there are changes to the accounting policies adopted by the company from one year to the next, these changes shall be stated together with the reasons for the changes and their effect on the accounts of the company.

Sums denominated in foreign currencies

50. Where any sums originally denominated in foreign currencies have been brought into accounts under any items shown in the balance sheet format or the profit and loss account formats, the basis on which those sums have been translated into Irish pounds (or the currency in which the accounts are drawn) shall be stated.

INFORMATION SUPPLEMENTING THE BALANCE SHEET

Share capital and debentures

51.—(1) The following information shall be given with respect to the company's share capital:

( a ) the authorised share capital, and

( b ) where shares of more than one class have been allotted, the number and aggregate nominal value of shares of each class allotted.

(2) In the case of any part of the allotted share capital that consists of redeemable shares, the following information shall be given:

( a ) the earliest and latest dates on which the company has power to redeem those shares,

( b ) whether those shares must be redeemed in any event or are liable to be redeemed at the option of the company or of the shareholder, and

( c ) whether any (and, if so, what) premium is payable on redemption.

52. If the company has allotted any shares during the financial year, the following information shall be given:

( a ) the reason for making the allotment,

( b ) the classes of shares allotted, and

( c ) as respects each class of shares, the number allotted, their aggregate nominal value and the consideration received by the company for the allotment.

53.—(1) With respect to any contingent right to the allotment of shares in the company the following particulars shall be given:

( a ) the number, description and amount of the shares in relation to which the right is exercisable,

( b ) the period during which it is exercisable, and

( c ) the price to be paid for the shares allotted.

2. In sub-paragraph (1) above "contingent right to the allotment of shares" means any option to subscribe for shares and any other right to require the allotment of shares to any person whether arising on the conversion into shares of securities of any other description or otherwise.

54.—(1) If the company has issued any debentures during the financial year to which the accounts relate, the following information shall be given:

( a ) the reason for making the issue,

( b ) the classes of debentures issued, and

( c ) as respects each class of debentures, the amount issued and the consideration received by the company for the issue.

(2) Particulars of any redeemed debentures which the company has power to reissue shall also be given.

(3) Where any of the company's debentures are held by a nominee of or trustee for the company, the nominal amount of the debentures and the amount at which they are stated in the accounting records kept by the company in accordance with section 202 of the Companies Act, 1990 , shall be stated.

Fixed assets

55.—(1) In respect of any fixed assets of the company included in any assets item in the company's balance sheet the following information shall be given by reference to each such item:

( a ) the appropriate amounts in respect of those assets included in the item as at the date of the beginning of the financial year and as at the balance sheet date respectively;

( b ) the effect on any amount included in the item in respect of those assets of:

(i) any determination during that year of the value to be ascribed to any of those assets in accordance with paragraph 41 above;

(ii) acquisition during that year of any fixed assets;

(iii) disposals during that year of any fixed assets; and

(iv) any transfers of fixed assets of the company to and from the item during that year.

(2) The reference in sub-paragraph (1) (a) to the appropriate amounts in respect of any fixed assets (included in an assets item) as at any date there mentioned is a reference to amounts representing the aggregate amounts determined, as at that date, in respect of fixed assets falling to be included under the item on either of the following bases, that is to say:

( a ) on the basis of cost (determined in accordance with paragraphs 36 and 37), or

( b ) on any basis permitted by paragraph 41;

(leaving out of account in either case any provisions for depreciation or diminution in value).

(3) In addition, in respect of any fixed assets of the company included in any assets item in the company's balance sheet, there shall be stated (by reference to each such item):

( a ) the cumulative amount of provisions for depreciation or diminution in value of those assets included under the item as at each date mentioned in sub-paragraph (1) (a),

( b ) the amount of any such provisions made in respect of the financial year,

( c ) the amount of any adjustments made in respect of any such provisions during that year in consequence of the disposal of any of those assets, and

( d ) the amount of any other adjustments made in respect of any such provisions during that year.

(4) The requirements of this paragraph need not be complied with to the extent that a company takes advantage of the option of setting off charges and income afforded by paragraph 5 (3) of this Part of this Schedule.

56. Where any fixed assets of the company (other than listed investments) are included under any item shown in the company's balance sheet at an amount determined in accordance with paragraph 41, the following information shall be given:

( a ) the years (so far as they are known to the directors) in which the assets were severally valued and the several values; and

( b ) in the case of assets that have been valued during the financial year, the names of the persons who valued them or particulars of their qualifications for doing so and (in either case) the bases of valuation used by them.

57. In relation to any amount which is included under Assets item 10 in the balance sheet format (Tangible fixed assets) with respect to land and buildings there shall be stated:

( a ) how much of that amount is ascribable to land of freehold tenure and how much to land of leasehold tenure; and

( b ) how much of the amount ascribable to land of leasehold tenure is ascribable to land held on long lease and how much to land held on short lease.

58. There shall be disclosed separately the amount of:

( a ) any participating interests; and

( b ) any shares in group undertakings

that are held in credit institutions.

Reserves and provisions

59.—(1) Where any amount is transferred—

( a ) to or from any reserves,

( b ) to any provisions for liabilities and charges,

( c ) from any provision for liabilities and charges otherwise than for the purpose for which the provision was established,

and the reserves or provisions are or would but for paragraph 3 (3) of this Part of this Schedule be shown as separate items in the company's balance sheet, the information mentioned in the following sub-paragraph shall be given in respect of the aggregate of reserves or provisions included in the same item.

(2) That information is:

( a ) the amount of the reserves or provisions as at the date of the begining of the financial year and as at the balance sheet date respectively,

( b ) any amounts transferred to or from the reserve to or from the reserve or provisions during that year, and

( c ) the source and application respectively of any amounts so transferred.

(3) Particulars shall be given of each provision included in Liabilities item 6 (c) (Other provisions) in the company's balance sheet in any case where the amount of that provision is material.

Provision for taxation

60. The amount of any provision for deferred taxation shall be stated separately from the amount of any provision for other taxation.

Maturity analysis

61.—(1) A company shall disclose separately for each of Assets items 3 (b) and 4 and Liabilities items 1 (b), 2 (b) and 3 (b) the aggregate amount of the loans and advances and liabilities included in those items broken down into the following categories:

( a ) those repayable in not more than three months;

( b ) those repayable in more than three months but not more than one year;

( c ) those repayable in more than one year but not more than five years;

( d ) those repayable in more than five years

from the balance sheet date.

(2) A company shall also disclose the aggregate amounts of all loans and advances falling within Assets item 4 (Loans and advances to customers) which are:

( a ) repayable on demand; or

( b ) are for an indeterminate period, being repayable upon short notice.

(3) For the purposes of sub-paragraph (1), where a loan or advance or liability is repayable by instalments, each such instalment is to be treated as a separate loan or advance or liability.

Debt and other fixed income securities

62. A company shall disclose the amount of debt and fixed income securities included in Assets item 5 (Debt securities and other fixed income securities) and the amount of such securities included in Liabilities item 3 (a) (Bonds and medium term notes) that in each case will become due within one year of the balance sheet date.

Subordinated liabilities

63.—(1) The following information must be disclosed in relation to any borrowing included in Liabilities item 7 (Subordinated liabilities) that exceeds 10 per cent of the total for that item:

( a ) its amount;

( b ) the currency in which it is denominated;

( c ) the rate of interest and the maturity date (or the fact that it is perpetual);

( d ) the circumstances in which early repayment my be demanded;

( e ) the terms of the subordination; and

( f ) the existence of any provisions whereby it may be converted into capital or some other form of liability and the terms of any such provisions.

(2) The general terms of any other borrowings included in Liabilities item 7 shall also be stated.

Fixed cumulative dividends

64. If any fixed cumulative dividends on the company's shares are in arrear, there shall be stated:

( a ) the amount of the arrears; and

( b ) the period for which the dividends or, if there is more than one class, each class of them are in arrears.

Details of assets charged

65.—(1) There shall be disclosed, in relation to each liabilities and off-balance sheet item of the balance sheet format, the aggregate amount of any assets of the company which have been charged to secure any liability or potential liability included thereunder, the aggregate amount of the liabilities or potential liabilities so secured and an indication of the nature of the security given.

(2) Particulars shall also be given of any other charge on the assets of the company to secure the liabilities of any other person, including, where practicable, the amount secured.

Guarantees and other financial commitments

66.—(1) There shall be stated, where practicable:

( a ) the aggregate amount or estimated amount of contracts for capital expenditure, so far as not provided for; and

( b ) the aggregate amount or estimated amount of capital expenditure authorised by the directors which has not been contracted for.

(2) Particulars shall given of:

( a ) any pension commitments included under any provision shown in the company's balance sheet; and

( b ) any such commitments for which no provision has been made;

and where any such commitment relates wholly or partly to pensions payable to past directors of the company separate particulars shall be given of that commitment so far as it relates to such pensions.

(3) The following information shall also be given:

( a ) the nature of every pension scheme operated by or on behalf of the company including information as to whether or not each scheme is a defined benefit scheme or a defined contribution scheme,

( b ) whether each such scheme is externally funded or internally financed,

( c ) whether any pension costs and liabilities are assessed in accordance with the advice of a professionally qualified actuary and, if so, the date of the most recent relevant actuarial valuation,

( d ) whether and, if so, where any such actuarial valuation is available for public inspection.

(4) Particulars shall also be given of any other financial commitments, including any contingent liabilities, which:

( a ) have not been provided for;

( b ) have not been included in the off-balance sheet items in the balance sheet format; and

( c ) are relevant to assessing the company's state of affairs.

(5) Commitments within any of the preceding sub-paragraphs undertaken on behalf of or for the benefit of:

( a ) any parent company or fellow subsidiary undertaking of the company; or

( b ) any subsidiary undertaking of the company;

shall be stated separately from the other commitments within that sub-paragraph (and commitments within paragraph (a) shall be stated separately from those within paragraph (b)).

(6) There shall be disclosed the nature and amount of any contingent liabilities and commitments included in off-balance sheet items 1 and 2 which are material in relation to the company's activities.

Off-balance sheet items: group undertakings

67.—(1) With respect to contingent liabilities required to be included under off-balance sheet item 1 in the balance sheet format, there shall be stated in a note to the accounts the amount of such contingent liabilities incurred on behalf of or for the benefit of:

( a ) any parent undertaking or fellow subsidiary undertaking, or

( b ) any subsidiary undertaking,

of the company; in addition the amount incurred in respect of the undertakings referred to in paragraph (a) shall be stated separately from the amount incurred in respect of the undertakings referred to in paragraph (b).

(2) With respect to commitments required to be included under off-balance sheet item 2 in the balance sheet format, there shall be stated in a note to the accounts the amount of such commitments undertaken on behalf of or for the benefit of:

( a ) any parent undertaking or fellow subsidiary undertaking, or

( b ) any subsidiary undertaking,

of the company; in addition the amount incurred in respect of the undertakings referred to in paragraph (a) shall be stated separately from the amount incurred in respect of the undertakings referred to in paragraph (b).

Transferable securities

68.—(1) There shall be disclosed for each of Asset items 5 to 8 in the balance sheet format the amount of transferable securities that are listed on a recognised stock exchange and the amount of those that are unlisted.

(2) In the case of each amount shown in respect of listed securities under subparagraph (1) above, there shall also be disclosed the aggregate market value of those securities, if different from the amount shown.

(3) There shall be disclosed for each of assets items 5 and 6 the amount of transferable securities included under those items that are held as financial fixed assets and the amount of those that are not so held, together with the criterion used by the directors to distinguish those held as financial fixed assets.

Leasing transactions

69. The aggregate amount of all property (other than land) leased by the company to other persons shall be disclosed, broken down so as to show the aggregate amount included in each relevant balance sheet item.

Assets and liabilities denominated in a currency other than Irish pounds (or the currency in which the accounts are drawn up)

70.—(1) The aggregate amount in Irish pounds (or currency in which the accounts are drawn up) of all assets denominated in a currency other than Irish pounds (or the currency used) of all liabilities so denominated, shall be disclosed.

(2) For the purposes of this paragraph an appropriate rate of exchange prevailing at the balance sheet date shall be used to determine the amounts concerned.

Sundry assets and liabilities

71. Where any amount shown under either of the following items is material, particulars shall be given of each type of assets or liability included therein, including an explanation of the nature of the asset or liability and the amount included with respect to assets or liabilities of that type:

( a ) Assets item 13 (Other assets),

( b ) Liabilities item 4 (Other liabilities).

Unmatured forward transactions

72.—(1) The following shall be disclosed with respect to unmatured forward transactions outstanding at the balance sheet date:

( a ) the categories of such transactions, by reference to an appropriate system of classification;

( b ) whether, in the case of each such category, they have been made, to any material extent, for the purpose of hedging the effects of fluctuations in interest rates, exchange rates and market prices or whether they have been made, to any material extent, for dealing purposes.

(2) Transactions falling within sub-paragraph (1) shall include all those in relation to which income or expenditure is to be included in:

( a ) format 1, item 6 or format 2, items B4 or A3 (Dealing profits or losses),

( b ) format 1, item 1 or format 2, item B1, by virtue of note (1) (b) to the profit and loss account formats (forward contracts, spread over the actual duration of the contract and similar in nature to interest).

Miscellaneous matters

73.—(1) Particulars shall be given of any case where the cost of any asset is for the first time determined under paragraph 38 of this Part of this Schedule.

(2) Where any outstanding loans made under the authority of section 60 of the Principal Act, other than subsection (13) (a) of that section (various cases of financial assistance by a company for purchase of its own shares) are included under any item shown in the company's balance sheet, the aggregate amount of those loans shall be disclosed for each item in question.

(3) The aggregate amount which is recommended for distribution by way of dividend shall be stated.

Particulars of any restriction on profits available for distribution by virtue of section 224 (2) (b) (1) of the Companies Act, 1990 , must be stated.

INFORMATION SUPPLEMENTING THE PROFIT AND LOSS ACCOUNT

Separate statement of certain items of income and expenditure

74.—(1) The amount respectively provided for the purchase of the company's share capital, for redemption of share capital and for redemption of share capital and for redemption of loans shall be stated.

(2) The amount of income from listed and unlisted investments shall be stated.

(3) The amount of the remuneration of the auditors and the expenses of the auditors shall be stated.

(4) The aggregate amount of the emoluments of, and compensation in respect of loss of office to, directors and compensation paid to past directors shall be stated.

Particulars of tax

75.—(1) The basis on which the charge for corporation tax, income tax and other taxation on profits (whether payable inside or outside the State) is computed shall be stated.

(2) Particulars shall be given of any special circumstances which affect liability in respect of taxation of profits, income or capital gains for the financial year concerned or liability in respect of taxation of profits, income or capital gains for succeeding financial years.

(3) The following amounts shall be stated:

( a ) the amount of the charge for corporation tax;

( b ) if that amount would have been greater but for relief from double taxation, the amount which it would have been but for such relief;

( c ) the amount of the charge for income tax; and

( d ) the amount of the charge for taxation payable outside the State of profits, income and (so far as charged to revenue) capital gains.

These amounts shall be stated separately in respect of each of the amounts which is shown under the following items in the profit and loss account, that is to say format 1 item 16, format 2 item A10 (Tax on profit or loss on ordinary activities) and format 1 item 21, format 2 item A13 (Tax on extraordinary profit or loss).

Particulars of income

76.—(1) A company shall disclose, with respect to income included in the following items in the profit and loss account formats, the amount of that income attributable to each of the geographical markets in which the company has operated during the financial year:

( a ) format 1 item 1, format 2 item B1 (Interest receivable);

( b ) format 1 item 3, format 2 item B2 (Dividend income);

( c ) format 1 item 4, format 2 item B3 (Fees and commissions receivable);

( d ) format 1 item 6, format 2 item B4 (Dealing profits);

( e ) format 1 item 7, format 2 item B7 (Other operating income).

(2) In analysing for the purposes of this paragraph the source of any income, the directors shall have regard to the manner in which the company's activities are organised.

(3) For the purposes of this paragraph, markets which do not differ substantially from each other shall be treated as one market.

(4) Where in the opinion of the directors the disclosure or any information required by this paragraph would be seriously prejudicial to the interests of the company, that information need not be disclosed, but the fact that any such information has not been disclosed must be stated.

Particulars of staff

77.—(1) The following information shall be given with respect to the employees of the company:

( a ) the average number of persons employed by the company in the financial year; and

( b ) the average number of persons so employed within each category of persons employed by the company.

(2) The average number required by sub-paragraph (1) (a) or (b) shall be determined by dividing the relevant annual number by the number of weeks in the financial year.

(3) The relevant annual number shall be determined by ascertaining for each week in the financial year:

( a ) for the purposes of sub-paragraph (1) (a), the number of persons employed under contracts of service by the company in that week (whether throughout the week or not); and

( b ) for the purposes of sub-paragraph (1) (b), the number of persons in the category in question of persons so employed;

and, in either case, adding together all the weekly numbers.

(4) In respect of all persons employed by the company during the financial year who are taken into account in determining the relevant annual number for the purposes of sub-paragraph (1) (a) there shall also be stated the aggregate amounts respectively of:

( a ) wages and salaries paid or payable in respect of that year to those persons;

( b ) social security costs incurred by the company on their behalf; and

save in so far as those amounts or any of them are stated in the profit and loss account.

(5) The categories of persons employed by the company by reference to which the number required to be disclosed by sub-paragraph (1) (b) is to be determined shall be such as the directors may select, having regard to the manner in which the company's activities are organised.

Management and agency services

78. A company providing any management and agency services to customers shall disclose that fact if the scale of such services provided is material in the context of its business as a whole.

Subordinated liabilities

79. Any amounts charged to the profit and loss acccount representing charges incurred during the year with respect to subordinated liabilities shall be disclosed.

Sundry income and charges

80. Where any amount to be included in any of the following items is material, particulars shall be given of each individual component of the figure, including an explanation of their nature and amount:

( a ) in format 1:

(i) items 7 and 10 (Other operating income and charges);

(ii) items 18 and 19 (Extraordinary income and charges);

( b ) in format 2:

(i) items A6 and B7 (Other operating charges and income);

(i) items A12 and B10 (Extraordinary charges and income).

Miscellaneous matters

81.—(1) Where any amount relating to any preceding financial year is included in any item in the profit and loss account, the effect shall be stated.

(2) The effect shall be stated on any transactions that are exceptional by virtue of size or incidence though they fall within the ordinry activities of the company.

(3) Particulars shall be given of any extraordinary income or changes arising in the financial year.

Regulation 7

PART II

FORM AND CONTENT OF GROUP ACCOUNTS

GENERAL RULES

1.—(1) Accounts shall comply so far as practicable with the provisions of Part I of this Schedule as if the undertakings included in the consolidation ("the group") were a single company.

(2) In particular, for the purposes of note (20) to the balance sheet format set out in Section B of Chapter 1 of Part 1 of this Schedule and paragraphs 66 (5) and 67 of Part 1 of this Schedule as it applies to group accounts—

( a ) any subsidiary undertakings of the parent company not included in the consolidation shall be treated as subsidiary undertakings of the group, and

( b ) if the parent company is itself a subsidiary undertaking, the group shall be treated as a subsidiary undertaking of any parent undertaking of that company, and the reference to fellow-subsidiary undertakings shall be construed accordingly.

2.—(1) Subject to the exceptions authorised or required by this paragraph, all the subsidiary undertakings of the parent company shall be included in the consolidation.

(2) A subsidiary undertaking may be excluded from consolidation if its inclusion is not material for the purpose of giving a true and fair view; but two or more undertakings may be excluded only if they are not material taken together.

(3) In addition, a subsidiary undertaking my be excluded from consolidation where—

( a ) severe long-term restrictions substantially hinder the exercise of the rights of the parent company over the assets or management of that undertaking, or

( b ) the information necessary for the preparation of group accounts cannot be obtained without disproportionate expense or undue delay, or

( c ) the interest of the parent company is held exclusively with a view to subsequent resale and the undertaking has not previously been included in consolidated group accounts prepared by the parent company.

The reference in paragraph (a) to the right of the parent company and the reference in paragraph (c) to the interest of the parent company are, respectively, reference to rights and interests held by or attributed to the company in the absence of which it would not be the parent company

(4) Subject to sub-paragraphs (6) and (7) of this paragraph, where the activities of one or more subsidiary undertakings are so different from those of other undertakings to be included in the consolidation that their inclusion would be incompatible with the obligation to give a true and fair view, those undertakings shall be excluded from consolidation.

(5) Any application of paragraph (4) of this paragraph does not apply merely because some of the undertakings are industrial, some commercial and some provide services, or because they carry on industrial or commercial activities involving different products or provide different services.

(7) Notwithstanding sub-paragraph (4) of this paragraph, an undertaking (other than a credit institution) whose activities are a direct extension of or ancillary to banking business shall not be excluded from the consolidation.

(8) Where all the subsidiary undertakings of a parent company fall within the above exclusions, no group accounts shall be required.

3.—(1) The consolidated balance sheet and profit and loss account shall incorporate in full the information contained in the individual accounts of the undertakings included in the consolidation, subject to the adjustments authorised or required by the following provisions of this Schedule and to such other adjustments (if any) as may be appropriate in accordance with generally accepted accounting principles or practice.

(2) Group accounts shall be drawn up as at the same date as the individual accounts of the parent company.

(3) If the financial year of a subsidiary undertaking included in the consolidation differs from that of the parent company, the group accounts shall be made up—

( a ) from the accounts of the subsidiary undertaking for its financial year last ending before the end of the parent company's financial year, provided that year ended no more than three months before that of the parent company, or

( b ) from interim accounts prepared by the subsidiary undertaking as at end of the parent company's financial year.

4.—(1) Where assets and liabilities to be included in the group accounts have been valued or otherwise determined by undertakings according to accounting rules differing from those used for the groups accounts, the values or amounts shall be adjusted so as to accord with the rules used for the group accounts.

(2) If it appears to the directors of the parent company that there are special reasons for departing from sub-paragraph (1) they may do so, but particulars of any such departure, the reasons for it and its effect shall be given in a note to the accounts.

(3) The adjustments referred to in this paragraph need not be made if they are not material for the purpose of giving a true and fair view.

5. Any differences of accounting rules as between a parent company's individual accounts for a financial year and its group accounts shall be disclosed in a note to the latter accounts and the reasons for the difference given.

6. Amounts which in the particular context of any provision of this Part of the Schedule are not material may be disregarded for the purposes of that provision.

7.—(1) Debts and claims between undertakings included in the consolidation, and income and expenditure relating to transactions between such undertakings, shall be eliminated in preparing the group accounts.

(2) Where profits and losses resulting from transactions between undertakings included in the consolidation are included in the book value of assets, they shall be eliminated in preparing the group accounts.

(3) Sub-paragraphs (1) and (2) need not be complied with if the amounts concerned are not material for the purpose of giving a true and fair view.

ACQUISITION AND MERGER ACCOUNTING

8.—(1) The following provisions apply where an undertaking becomes a subsidiary undertaking of the parent company.

(2) That event is referred to in those provisions as an "acquisition", and references to the "undertaking acquired" shall be construed accordingly.

9. An acquisition shall be accounted for by the acquisition method of accounting unless the conditions for accounting for it as a merger are met and the merger method of accounting is adopted.

10.—(1) The acquisition method of accounting is as follows.

(2) The identifiable assets and liabilities of the undertaking acquired shall be included in the consolidated balance sheet at their fair values as at the date of acquisition.

In this paragraph the "identifiable" assets or liabilities of the undertaking acquired means the assets or liabilities which are capable of being disposed of or discharged separately, without disposing of a business of the undertaking.

(3) The income and expenditure of the undertaking acquired shall be brought into the group accounts only as from the date of the acquisition.

(4) There shall be set off against the acquisition cost of the interest in the shares of the undertaking held by the parent company and its subsidiary undertakings the interest of the parent company and its subsidiary undertakings in the adjusted capital and reserves of the undertaking acquired.

For this purpose—

"the acquisition cost" means the amount of any cash consideration and the fair value of any other consideration, together with such amount (if any) in respect of fees and other expenses of the acquisition as the company may determine, and

"the adjusted capital and reserves" of the undertaking acquired means its capital and reserves at the date of the acquisition after adjusting the identifiable assets and liabilities of the undertaking to fair values as at that date.

(5) The resulting amount if positive shall be treated as goodwill, and if negative as a negative consolidation difference.

(6) Where in applying the acquisition method of accounting—

( a ) there is no record of—

(i) the fair values as at the date of acquisition of the identifiable assets and liabilities of the undertaking acquired, or

(ii) the acquisition cost of the interest in the shares of the acquired undertaking by the undertakings dealt with in the group accounts, or

( b ) such records cannot be obtained without unreasonable expense or delay,

the values of the identifiable assets and liabilities and the acquisition cost shall be taken to be the values and cost ascribed to them in the earliest available record made after the acquisition of that subsidiary undertaking.

11.—(1) The conditions for accounting for an acquisition as a merger are—

( a ) that at least 90 per cent of the nominal value of the relevant shares in the undertaking acquired is held by or on behalf of the parent company and its subsidiary undertakings,

( b ) that the proportion referred to in paragraph (a) was attained pursuant to an arrangement providing for the issue of equity shares by the parent company or one or more of its subsidiary undertakings, and

( c ) that the fair value of any consideration other than the issue of equity share given pursuant to the arrangement by the parent company and its subsidiary undertakings did not exceed 10 per cent of the nominal value of the equity shares issued.

(2) The reference in sub-paragraph (1) (a) to the "relevant shares" in an undertaking acquired is to those carrying unrestricted rights to participate both in distributions and in the assets of the undertaking upon liquidation.

12.—(1) The merger method of accounting is as follows:

(2) The assets and liabilities of the undertaking acquired shall be brought into the group accounts at the figures at which they stand in the undertaking's accounts, subject to any adjustment authorised or required by this Part of the Schedule.

(3) The income and expenditure of the undertaking acquired shall be included in the group accounts for the entire financial year, including the period before the acquisition.

(4) The group accounts shall show corresponding amounts relating to the previous financial year as if the undertaking acquired had been included in the consolidation throughout that year.

(5) There shall be set off against the aggregate if—

( a ) the appropriate amount in respect of shares issued by the parent company or its subsidiary undertakings in consideration for the acquisition of shares in the undertaking acquired, and

( b ) the fair value of any other consideration for the acquisition of shares in the undertaking acquired, determined as at the date when those shares were acquired,

the nominal value of the issued share capital of the undertaking acquired held by the parent company and its subsidiary undertakings.

(6) The resulting amount shall be shown as an adjustment to the consolidated reserves.

13.—(1) Where a group of undertakings is acquired, paragraphs 10 to 12 apply with the following adaptations.

(2) References to shares of the undertaking acquired shall be construed as references to shares of the parent undertaking of the group.

(3) Other references to the undertaking acquired shall be construed as references to the group; and references to the assets and liabilities, income and expenditure and capital and reserves of the undertaking acquired shall be construed as references to the assets and liabilities, income and expenditure and capital and reserves of the group after making the set offs and other adjustments required by this Part of the Schedule in the case of group accounts.

(2) There shall be stated—

( a ) the name of the undertaking acquired or, where a group was acquired, the name of the parent undertaking of that group, and

( b ) whether the acquisition has been accounted for by the acquisition or the merger method of accounting.

15. In relation to the resulting amounts referred to in paragraphs 10 (5) and 12 (6) of this Part of the Schedule, there shall be stated in a note to the group accounts the methods used in calculating those amounts and the reasons for any significant difference betweeen those amounts for the financial year to which the group accounts refer and the preceding financial year.

CHANGES IN COMPOSITION OF THE GROUP

16. If the composition of the undertakings dealt with in the group accounts has changed significantly in the course of a financial year, the group accounts must include information which makes the comparison of successive sets of group accounts meaningful.

DIFFERENCES IN TAX TREATMENTS

17. Account shall be taken in the group accounts of any difference arising on consolidation between the tax chargeable for the financial year and for preceding financial years and the amount of tax paid or payable in respect of those years, provided that it is probable that an actual charge to tax will arise within the foreseeable future for one of the undertakings dealt with in the group accounts.

MINORITY INTERESTS

18.—(1) The formats set out in Part I of this Schedule have effect in relation to group accounts with the following additions.

(2) In the Balance Sheet Format a further item headed "Minority interests" shall be added—

( a ) either between "LIABILITIES" items 7 and 8, or

( b ) after "LIABILITIES" item 12;

and under that item shall be shown the amount of capital and reserves attributable to shares in subsidiary undertakings included in the consolidation held by or on behalf of persons other than the parent company and its subsidiary undertakings.

(3) In the Profit and Loss Account Formats a further item headed "Minority interests" shall be added—

( a ) in Format 1, between items 17 and 18; and

( b ) in Format 2, between items A11 and A12 or between items B9 and B10;

and under that item shall be shown the amount of any profit or loss on ordinary activities attributable to shares in subsidiary undertakings included in the consolidation held by or on behalf of persons other than the parent company and its subsidiary undertakings.

(4) In the Profit and Loss Account Formats a further item headed "Minority interests" shall be added—

( a ) in Format 1, between items 22 and 23, and

( b ) in Format 2, between items A14 and A15 or between items B11 and B12;

and under that item shall be shown the amount of any profit or loss on extraordinary activities attributable to shares in subsidiary undertakings included in the consolidation held by or on behalf of persons other than the parent company and its subsidiary undertakings.

(5) For the purposes of paragraph 3 (3) of Part I of this Schedule (power to combine items) the additional items required by the foregoing provisions of this paragraph shall be treated as items to which a letter is assigned.

INTERESTS IN SUBSIDIARY UNDERTAKINGS EXCLUDED FROM CONSOLIDATION

19.—(1) The interest of the group in subsidiary undertakings excluded from consolidation under paragraph 2 (4) of this Part of the Schedule (undertakings with activities different from those of undertakings included in the consolidation), and the amount of profit or loss attributable to such an interest, shall be shown in the consolidated balance sheet or, as the case may be, in the consolidated profit and loss account by the equity method of accounting (including dealing with any goodwill arising in accordance with paragraphs 24, 26 and 28 of Part 1 of this Schedule).

JOINT VENTURES

20.—(1) Where an undertaking included in the consolidation manages another undertaking jointly with one or more undertakings not included in the consolidation, that other undertaking ("the joint venture") may, if it is not—

( a ) a body corporate, or

( b ) a subsidiary undertaking of the parent company,

be dealt with in the group accounts by the method of proportional consolidation.

(2) The provisions of this Part relating to the preparation of consolidated accounts apply, with any necessary modifications to proportional consolidation under this paragraph.

ASSOCIATED UNDERTAKINGS

21.—(1) An "associated undertaking" means an undertaking in which an undertaking included in the consolidation has a participating interest and over whose operating and financial policy it exercises a significant influence, and which is not—

( a ) a subsidiary undertaking of the parent company, or

( b ) a joint venture dealt with in accordance with paragraph 20.

(2) Where an undertaking holds 20 per cent or more of the qualifying capital interest in another undertaking, it shall be presumed to exercise such an influence over it unless the contrary is shown.

(3) Paragraphs (3) and (4) of Regulation 4 of the European Communities (Companies; Ggroup Accounts) Regulations, 1992, shall apply for determining whether subparagraph (2) above applies.

22.—(1) The formats in Part 1 of this Schedule shall have effect in relation to group accounts with the following modifications.

(2) In the balance Sheet format assets item 7 (Participating Interests) shall be replaced by two items headed

"Interests in associated undertakings"

and

"Other participating interests".

(3) In the Profit and Loss Account formats the following items, namely:

( a ) format 1, item 3 (b), (Income from participating interests), and

( b ) format 2, item B2 (b) (Income from participating interests),

shall be replaced by the following two replacement items:

(i) "Income from participating interests other than associated undertakings", which shall be shown at position 3 (b) in format 1 and position B2 (b) in format 2; and

(ii) "Income from associated underakings", which shall be shown at an appropriate position.

23.—(1) The interest of an underaking in an associated underaking, and the amount of profit or loss attributable to such an interest, shall be shown by the equity method of accounting (including dealing with any goodwill arising in accordance with paragraphs 24, 26 and 28 of Part 1 of this Schedule).

(2) Where the associated undertaking is itself a parent undertaking, the net assets and profits or losses to be taken into account are those of the parent and its subsidiary undertaking (after making any consolidation adjustments).

(3) The equity method of accounting need not be applied if the amounts in question are not material for the purpose of giving a true and fair view.

FOREIGN CURRENCY TRANSLATION

24. Any difference between:

( a ) the amount included in the consolidated account for the previous financial year with respect to any undertaking included in the consolidation or the group's interest in any associated undertaking, together with the amount of any transactions undertaken to cover any such interest; and

( b ) the opening amount for the financial year in respect of those undertakings and in respect of any such transactions arising as a result of the application of paragraph 45 of Part I of this Schedule may be credited to (where (a) is less than (b)), or deducted from (where (a) is less than (b)), (as the case may be) consolidated reserves.

25. Any income and expenditure of undertakings included in the consolidation and associated undertakings in a foreign currency may be translated for the purposes of the consolidated accounts at the average rates of exchange prevailing during the financial year.

INFORMATION AS TO UNDERTAKING IN WHICH SHARES ARE HELD AS A RESULT OF A FINANCIAL ASSISTANCE OPERATION

26.—(1) The following provisions apply where the present company of a banking group has a subsidiary undertaking which:

( a ) is a credit institution of which shares are held as a result of a financial assistance operation with a view to its reorganisation or rescue; and

( b ) is excluded from consolidation under paragraph 2 (3) (c) (interest held with a view to resale).

(2) Information as to the nature and terms of the operations shall be given in a note to the group accounts and there shall be appended to the copy of the group accounts annexed to the annual return of the parent company a copy of the undertaking's latest individual accounts and, if it is a parent undertaking, its latest group accounts.

If the accounts appended are required by law to be audited, a copy of the auditors' report shall also be appended.

(3) If any document required to be appended is in a language other than Irish or English, the directors shall annex a translation of it into Irish or English, certified to be a correct translation.

(4) The above requirements are subject to the following qualifications:

( a ) an undertaking is not required to prepare for the purposes of this paragraph accounts which would not otherwise be required to be prepared, and if no accounts satisfying the above requirements are prepared none need be appended;

( b ) the accounts of an undertaking need not be appended if they would not otherwise be required to be published, or made available for public inspection, anywhere in the world, but in that case the reason for not appending the accounts shall be stated in a note to the consolidated accounts.

(5) Where a copy of an undertaking's accounts is required to be appended to the copy of the group accounts annexed to the annual return, that fact shall be stated in a note to the group accounts.

Regulation 10

PART III

DISCLOSURE OF INFORMATION: RELATED UNDERTAKINGS

A. COMPANIES NOT REQUIRED TO PREPARE GROUP ACCOUNTS

SUBSIDIARY UNDERTAKINGS

1.—(1) The following information shall be given where at the end of the financial year the company has subsidiary undertakings.

(2) The name of each subsidiary undertaking shall be stated.

(3) There shall be stated with respect to each subsidiary undertaking—

( a ) if it is incorporated, the country in which it is incorporated;

( b ) if it is unincorporated, the address of its principal place of business.

(4) The reason why the company is not required to prepare group accounts shall be stated.

(5) If the reason is that the subsidiary undertakings of the company fall within the exclusions provided for in paragraph (2) of Part II of this Schedule, it shall be stated with respect to each subsidiary undertaking which of those exclusions applies.

HOLDINGS IN SUBSIDIARY UNDERTAKINGS

2. There shall be stated in relation to shares of each class held by the company in a subsidiary undertaking—

( a ) the identity of the class, and

( b ) the proportion of the nominal value of the shares of that class represented by those shares.

FINANCIAL INFORMATION ABOUT SUBSIDIARY UNDERTAKINGS

3.—(1) There shall be disclosed with respect to each subsidiary undertaking—

( a ) the aggregate amount of its capital and reserves as at the end of its relevant financial year, and

( b ) its profit or loss for that year.

(2) That information need not be given if the company is exempt by virtue of regulation 8 of these Regulations from the requirements to prepare group accounts (parent company included in accounts of larger group).

(3) That information need not be given if—

( a ) the subsidiary undertaking is not otherwise required to publish its accounts, and

( b ) the company's holding is less than 50 per cent of the nominal value of the shares in the undertaking.

(4) Information otherwise required by this paragraph need not be given if it is not material.

(5) For the purposes of this part of the Schedule the "relevant financial year" of a subsidiary undertaking is—

( a ) if its financial year ends with that of the company, that year, and

( b ) if not, its financial year ending last before the end of the company's financial year.

FINANCIAL YEARS OF SUBSIDIARY UNDERTAKINGS

4. Where the financial year of one or more subsidiary undertakings did not end with that of the company, there shall be stated in relation to each such undertaking—

( a ) the reason why the company's directors consider that its financial year should not end with that of the company, and

( b ) the date on which its last financial year ended (last before the end of the company's financial year).

Instead of the date required by paragraph (b) being given for each subsidiary undertaking the earliest and latest of those dates may be given.

FURTHER INFORMATION ABOUT SUBSIDIARY UNDERTAKINGS

5.—(1) There shall be disclosed—

( a ) any qualifications contained in the auditors' reports on the accounts of subsidiary undertakings for financial years ending with or during the financial year of the company, and

( b ) any note or saving contained in such accounts to call attention to a matter which, apart from the note or saving, would properly have been referred to in such a qualification,

in so far as the matter which is the subject of the qualification or note is not covered by the company's own accounts and is material from the point of view of its members.

(2) The aggregated amount of the total investment of the company in the shares of subsidiary undertakings shall be stated by way of the equity method of valuation, unless—

( a ) the company is exempt from the requirement to prepare group accounts by virtue of regulation 8 of these regulations (parent company included in accounts of larger group), and

( b ) the directors state their opinion that the aggregate value of the assets of the company consisting of shares in, or amounts owing (whether on account of a loan or otherwise) from, the company's subsidiary undertakings is not less than the aggregate of the amounts at which those assets are stated or included in the company's balance sheet.

(3) In so far as information required by this paragraph is not obtainable, a statement to that effect shall be given instead.

SHARES AND DEBENTURES OF COMPANY HELD BY SUBSIDIARY UNDERTAKINGS

6.—(1) The number, description and amount of the shares in and debentures of the company held by or on behalf of its subsidiary undertakings shall be disclosed.

(2) Sub-paragraph (1) does not apply in relation to shares or debentures in the case of which the subsidiary undertaking is concerned as personal representative or, subject as follows, as trustee.

(3) The exception for shares or debentures in relation to which the subsidiary undertaking is concerned as trustee does not apply if the company, or any subsidiary undertaking of the company, is beneficially interested under the trust, otherwise than by way of security only for the purposes of a transaction entered into by it in the ordinary course of a business which includes the lending of money.

SIGNIFICANT HOLDINGS IN UNDERTAKINGS OTHER THAN SUBSIDIARY UNDERTAKINGS

7.—(1) The information required by paragraphs 8 and 9 shall be given where at the end of the financial year the company has a significant holding in an undertaking which is not a subsidiary undertaking of the company.

(2) A holding is significant for this purpose if it amounts to 20 per cent or more of all interests held by the company in an undertaking.

8.—(1) The name of the undertaking shall be stated

(2) There shall be stated—

( a ) if the undertaking is incorporated, the country in which it is incorporated;

( b ) if it is unincorporated, the address of its principal place of business.

(3) There shall also be stated—

( a ) the identity of each class of shares in the undertaking held by the company, and

( b ) the proportion of the nominal value of the shares of that class represented by those shares.

9.—(1) There shall also be stated—

( a ) the aggregate amount of the capital and reserves of the undertaking as at the end of its relevant financial year, and

( b ) its profit or loss for that year.

(2) That information need not be given if—

( a ) the company is exempt by virtue of regulation 8 of these regulations from the requirement to prepare group accounts (parent company included in accounts of larger group), and

( b ) the investment of the company in all undertakings in which it has such a holding as is mentioned in sub-paragraph (1) is shown, in aggregate, in the notes to the accounts by way of the equity method of valuation.

(3) That information need not be given in respect of an undertaking if—

( a ) the undertaking is not otherwise required to publish its accounts, and

( b ) the company's holding is less than 50 per cent of the nominal value of the shares in the undertaking.

PARENT UNDERTAKING DRAWING UP ACCOUNTS FOR LARGER GROUP

10.—(1) Where the company is a subsidiary undertaking, the following information shall be given with respect to the parent undertaking of—

( a ) the largest group of undertakings for which group accounts are drawn up and of which the company is a member, and

( b ) the smallest such group of undertakings.

(2) The name of the parent undertaking shall be stated

(3) There shall be stated—

( a ) if the undertaking is incorporated, the country is which it is incorporated;

( b ) if it is unincorporated, the address of its principal place of business.

(4) If copies of the group accounts referred to in sub-paragraph (1) are available to the public, there shall also be stated the addresses from which copies of the accounts can be obtained.

B. COMPANIES REQUIRED TO PREPARE GROUP ACCOUNTS

SUBSIDIARY UNDERTAKINGS

11.—(1) The following information shall be given with respect to the undertakings which are subsidiary undertakings of the parent company at the end of the financial year.

(2) The name of each undertaking shall be stated.

(3) There shall be stated—

( a ) if the undertaking is incorporated, the country in which it is incorporated;

( b ) if it is unincorporated, the address of its principal place of business.

(4) It shall also be stated whether the subsidiary undertaking is included in the consolidation and, if it is not, the reasons for excluding it from consolidation shall be given.

(5) The relevant provisions of regulation 4, other than sub-paragraph 1 (a), of the European Communities (Companies; Group Accounts) Regulations, 1992 which apply to each subsidiary shall be stated.

HOLDINGS IN SUBSIDIARY UNDERTAKINGS

12.—(1) The following information shall be given with respect to the shares of a subsidiary undertaking held—

( a ) by the parent company,

( b ) by the group;

and the information under paragraphs (a) and (b) shall (if different) be shown separately.

(2) There shall be stated—

( a ) the identity of each class of shares held, and

( b ) the proportion of the nominal value of the shares of that class represented by those shares.

FINANCIAL INFORMATION ABOUT SUBSIDIARY UNDERTAKINGS NOT INCLUDED IN THE CONSOLIDATION

13.—(1) There shall be shown with respect to each subsidiary undertaking not included in the consolidation—

( a ) the aggregate amount of its capital and reserves as at the end of its relevant financial year, and

( b ) its profit or loss for that year.

(2) That information need not be given if the group's investment in the undertaking is included in the accounts by way of the equity method of valuation or if—

( a ) the undertaking is not otherwise required to publish its accounts, and

( b ) the holding of the group is less than 50 per cent of the nominal value of the shares in the undertaking.

(3) Information otherwise required by this paragraph need not be given if it is not material.

FURTHER INFORMATION ABOUT SUBSIDIARY UNDERTAKINGS EXCLUDED FROM CONSOLIDATION

14.—(1) The following information shall be given with respect to subsidiary undertakings excluded from consolidation.

(2) There shall be disclosed—

( a ) any qualifications contained in the auditors' reports on the accounts of the undertaking for financial years ending with or during the financial year of the Company, and

( b ) any note or saving contained in such accounts to call attention to a matter which, apart from the note or saving, would properly have been referred to in such a qualification,

in so far as the matter which is the subject of the qualification or note is not covered by the consolidated accounts and is material from the point of view of the members of the parent company.

(3) In so far as information required by this paragraph is not obtainable, a statement to that effect shall be given instead.

FINANCIAL YEARS OF SUBSIDIARY UNDERTAKINGS

15. Where the financial year of one or more subsidiary undertaking did not end with that of the company, there shall be stated in relation to each such undertaking—

( a ) the reasons why the company's directors consider that its financial year should not end with that of the company, and

( b ) the date on which its last financial year ended (last before the end of the company's financial year).

Instead of the dates required by paragraph (b) being given for each subsidiary undertaking the earliest and latest of those dates may be given.

SHARES AND DEBENTURES OF COMPANY HELD BY SUBSIDIARY UNDERTAKINGS

16.—(1) The number, description and amount of the shares in and debentures of the company held by or on behalf of its subsidiary undertakings shall be disclosed.

(2) Sub-paragraph (1) does not apply in relation to shares or debentures in the case of which the subsidiary undertaking is concerned as personal representative or, subject as follows, as trustee.

(3) The exception for shares or debentures in relation to which the subsidiary undertaking is concerned as trustee does not apply if the company, or any of its subsidiary undertakings, is beneficially interested under the trust, otherwise than by way of security only for the purposes of a transaction entered into by it in the ordinary course of a business which includes the lending of money.

JOINT VENTURES.

17.—(1) The following information shall be given where an undertaking is dealt with in the consolidated accounts by the method of proportional consolidation in the case of joint ventures—

( a ) the name of the undertaking;

( b ) the address of the principal place of business of the undertaking;

( c ) the factors on which joint management of the undertaking is based; and

( d ) the proportion of the capital of the undertaking held by undertakings included in the consolidation.

(2) Where the financial year of the undertaking did not end with that of the company, there shall be stated the date on which the financial year of the undertaking last ended before that date.

ASSOCIATED UNDERTAKINGS

18.—(1) The following information shall be given where an undertaking included in the consolidation has an interest in an associated undertaking.

(2) The name of the associated undertaking shall be stated.

(3) There shall be stated—

( a ) if the undertaking is incorporated, the country in which it is incorporated;

( b ) if it is unincorporated, the address of its principal place of business.

(4) The following information shall be given with respect to the shares of the undertaking held—

( a ) by the parent company, and

( b ) by the group;

and the information under paragraphs (a) and (b) shall be shown separately.

(5) There shall be stated—

( a ) the identity of each class of shares held, and

( b ) the proportion of the nominal value of the shares of that class represented by those shares.

(6) In this paragraph "associated undertakings" has the meaning given by paragraph 21 of Part II of this Schedule and the information required by this paragraph shall be given notwithstanding that paragraph 6 of that Schedule (materiality) applies in relation to the accounts themselves.

OTHER SIGNIFICANT HOLDINGS OF PARENT COMPANY

19.—(1) The information required by paragraphs 20 and 21 shall be given where at the end of the financial year the parent company has a significant holding in an undertaking which is not one of its subsidiary undertakings and does not fall within paragraph 17 (joint ventures) or paragraph 18 (associated undertakings).

(2) A holding is significant for this purpose if it amounts to 20 per cent or more of all interests in an undertaking.

20.—(1) The name of the undertaking shall be stated.

(2) There shall be stated—

( a ) if the undertaking is incorporated, the country in which it is incorporated;

( b ) if it is unincorporated, the address of its principal place of business.

(3) The following information shall be given with respect to the shares of the undertaking held by the parent company.

(4) There shall be stated—

( a ) the identity of each class of shares held, and

( b ) the proportion of the nominal value of the shares of that class represented by those shares.

21.—(1) There shall also be stated—

( a ) the aggregate amount of the capital and reserves of the undertakings at the end of its relevant financial year, and

( b ) its profit or loss for that year.

(2) That information need not be given in respect of an undertaking if—

( a ) the undertaking is not otherwise required to publish its accounts, and

( b ) the company's holding is less than 50 per cent of the nominal value of the shares in the undertaking.

(3) Information otherwise required by this paragraph need not be given if it is not material.

PARENT UNDERTAKING DRAWING UP ACCOUNTS FOR LARGER GROUP

22.—(1) Where the parent company is itself a subsidiary undertaking, the following information shall be given with respect to that parent undertaking of the company which heads—

( a ) the largest group of undertakings for which group accounts are drawn up and of which that company is a member, and

( b ) the smallest such group of undertakings.

(2) The name of the parent undertaking shall be stated.

(3) There shall be stated—

( a ) if the undertaking is incorporated, the country in which it is incorporated;

( b ) if it is unincorporated, the address of its principal place of business.

(4) If copies of the group accounts referred to in sub-paragraph (1) are available to the public, there shall also be stated the addresses from which copies of the accounts can be obtained.

23. References in this part to shares held by a company shall be construed as being held or not being held by that company in accordance with the rules set out in regulation 4 (3) of the European Communities (Companies; Group Accounts) Regulations, 1992.

PART IV

INTERPRETATION

General

1. The following definitions apply for the purposes of this Schedule and its interpretation:

"Banking activities" means activities normally undertaken by a bank or building society;

"Banking transactions" means transactions entered into in the normal course of a deposit taking business within the meaning of the Central Bank Act 1989 ;

"Fellow subsidiary": an undertaking shall be treated as a fellow subsidiary of another undertaking if both are subsidiaries of the same undertaking but neither is the other's;

"Financial fixed assets" means loans and advances and securities held as fixed assets; participating interests and shareholdings in group undertakings shall be regarded as financial fixed assets;

"Fungible assets" means assets of any description which are substantially indistinguishable one from another;

"Group" means a parent undertaking and its subsidiary undertakings;

"Group Undertakings" has the meaning assigned to it by paragraph 64 of the Schedule to the Act of 1986 as amended by the Schedule to the European Communities (Companies; Group Accounts) Regulations, 1992;

"Included in the consolidation", in relation to group accounts, or "included in consolidated group accounts", means that the undertaking is included in the accounts by the method of full (and not proportional) consolidation, and references to an undertaking excluded from consolidation shall be construed accordingly;

"Lease" includes an agreement for a lease;

"Listed security" means a security listed on a recognised stock exchange, and the expression "unlisted security" shall be construed accordingly;

"Long lease" means a lease in the case of which the portion of the term for which it was granted remaining unexpired at the end of the financial year is not less than 50 years;

"Parent" means a holding company;

"Participating interest" and "qualifying capital interest" have the meanings assigned to them by regulation 35 of the European Communities (Companies; Group Accounts) Regulations, 1992;

"Repayable on demand", in connection with deposits, loans or advances, means those amounts which can at any time be withdrawn or demanded without notice or for which a maturity or period of notice of not more than 24 hours or one working day has been agreed;

"Sale and repurchase transaction" means a transaction which involves the transfer by a credit institution or customer ("the transferor") to another credit institution or customer ("the transferee") of assets subject to an agreement that the same assets, or (in the case of fungible assets) equivalent assets, will subsequently be transferred back to the transferor at a specified price on a date specified or to be specified by the transferor; but the following shall not be regarded as sale and repurchase transactions: forward exchange transactions, options, transactions involving the issue of debt securities with a commitment to repurchase all or part of the issue before maturity or any similar transactions;

"Sale and option to resell transaction" means a transaction which involves the transfer by a credit institution or customer ("the transferor") to another credit institution or customer ("the transferee") of assets subject to an agreement that the transferee is entitled to require the subsequent transfer of the same assets, or (in the case of fungible assets) equivalent assets, back to the transferor at the purchase price or another price agreed in advance on a date specified or to be specified; and

"Short lease" means a lease which is not a long lease.

Loans

2. For the purposes of this Schedule a loan or advance (including a liability comprising a loan or advance) is treated as falling due for repayment, and an instalment of a loan or advance is treated as falling due for payment, on the earliest date on which the lender could require repayment or (as the case may be) payment, if he exercised all options and rights available to him.

Materiality

3. For the purposes of this Schedule amounts which in the particular context of any provision of this Schedule are not material may be disregarded for the purposes of that provision.

Pensions and Emoluments

4. In the case of group accounts, the pension commitments referred to in paragraph 66 (2) and the emoluments and compensation referred to in paragraph 74 (5) of Part I of this Schedule shall be a reference to commitments, emoluments and compensation relating to directors or past directors of the parent company in respect of duties relating to that parent or any of its subsidiary undertakings or undertakings proportionally consolidated in accordance with paragraph 20 of Part II of this Schedule.

Provisions

5. For the purposes of this Schedule and its interpretation:

( a ) references to provisions for depreciation or diminution in value of assets are to any amount written off by way of providing for depreciation or diminution in value of assets;

( b ) any reference in the profit and loss account formats or the notes thereto set out in Section B of Part I to the depreciation of, or amounts written off, assets of any description is to any provision for depreciation or diminution in value of assets of that description; and

( c ) references to provisions for liabilities or charges are to any amount retained as reasonably necessary for the purpose of providing for any liability or loss which is either likely to be incurred, or certain to be incurred but certain as to amount or as to the date on which it will arise.

Staff Costs

6. In this Schedule—

( a ) "Social security costs" means any contributions by the company to any state social security or pension scheme, fund or arrangement;

( b ) "Pension costs" includes any other contributions by the company for the purposes of any pension scheme established for the purpose of providing pensions for persons employed by the company, any sums set aside for that purpose and any amounts paid by the company in respect of pensions without first being so set aside; and

( c ) any amount stated in respect of either of the above items or in respect of the item "wages and salaries" in the company's profit and loss account shall be determined by references to payments made or costs incurred in respect of all persons employed by the company during the financial year who are taken into account in determining the relevant annual number for the purposes of paragraph 77 (1) (a).

GIVEN under my Official Seal, this 2nd day of October, 1992.

B. AHERN,

Minister for Finance.

EXPLANATORY NOTE.

The purpose of these Regulations is to give legal effect to Council Directive 86/635/EC on the annual accounts and consolidated accounts of banks and other financial institutions, and to Council Directive 89/117/EC on the obligations of branches established in a Member State of credit institutions and financial institutions having their head offices outside the Member State regarding the publication of annual accounting documents.

The Regulations apply to licensed banks in the State and to the ACC Bank and ICC Bank. They require the bank in question to draw up and publish individual and group accounts in accordance with the Regulations and the Schedule to the Regulations. They contain provisions relating to the accounting treatment and disclosure requirements of subsidiaries, associated undertakings and joint ventures and the material to be contained in the report of the directors and the auditors. The Regulations also provide for penalties for non-compliance of up to £1,000 and 12 months imprisonment.

The Schedule to the Regulations contains provisions governing the form and content of accounts, the format of the balance sheet and profit and loss accounts, the valuation of items in the accounts and the information to be given in the notes to the accounts. The Schedule also deals with the rules regarding the preparation of group accounts and sets out the nature and content of the information to be given in relation to subsidiary and other related undertakings.

The Regulations require branches of foreign banks in the State to publish the accounts of the undertaking to which they belong. The Central Bank may also require branches to publish certain information about the activities of the branches themselves in accordance with the EC Directives referred to above.

The Regulations apply in respect of all financial years of the relevant institutions beginning on or after 1 January 1993.