New reporting regulations are now effective
The Companies (Miscellaneous Reporting) Regulations 2018 came into force on 1 January 2019 requiring various additional reporting requirements for financial years beginning on or after that date. The additional requirements are as follows:
· Companies with either 2000 or more employees or both a turnover in excess of £200 million and a balance sheet total of over £2 billion must provide a statement of corporate governance arrangements (excepting companies already required to provide a corporate governance statement, charitable companies or community interest companies).
· For companies meeting two out of the three of the following: (i) a turnover of more than £36 million; (ii) a balance sheet total of more than £18 million; and (iii) more than 250 employees:
o An explanation in the strategic report as to how directors had regard to the matters listed in section 172 Companies Act 2006. Section 172 is the director’s duty to promote the success of the company for the benefit of its members as a whole and having regard to (a)the likely consequences of any decision in the long term, (b)the interests of the company's employees, (c)the need to foster the company's business relationships with suppliers, customers and others, (d)the impact of the company's operations on the community and the environment, (e)the desirability of the company maintaining a reputation for high standards of business conduct, and (f)the need to act fairly as between members of the company.
o A statement of engagement with customers and suppliers.
· For companies with more than 250 UK employees:
o A statement of engagement with employees (quoted and unquoted companies).
o CEO pay ratios (quoted companies only)
The new voluntary Wates Corporate Governance Principles for Large Private Companies provides a framework for companies to comply with the new reporting requirements.
Posted on 5 February, 2019 by Ortolan