PART X

Accounts and Audit

182. —In this Part—

“the Council Directive” means Council Directive No. 84/253/EEC of 10 April, 1984* on the approval of persons responsible for carrying out the statutory audits of accounting documents;

“friendly society” means a society registered under the Friendly Societies Acts, 1896 to 1977;

“practising certificate” means a certificate awarded to a person by a body of accountants entitling that person to practise as auditor of a company or as a public auditor;

“public auditor” means a public auditor for the purposes of the Industrial and Provident Societies Acts, 1893 to 1978, and the Friendly Societies Acts, 1896 to 1977.

183. —Section 160 of the Principal Act is hereby amended—

(a) by the substitution of the following subsections for subsection (5)—

“(5) Without prejudice to any rights of the auditor in relation to his removal under this subsection, a company may, by ordinary resolution at a general meeting, remove an auditor other than an auditor who is the first auditor or one of the first auditors of the company and appoint in his place any other person who has been nominated for appointment by any member of the company, who is qualified under the Companies Acts to be an auditor of a company and of whose nomination notice has been given to its members.

(5A) (a) A company shall—

(i) within one week of the Minister's power under subsection (4) becoming exercisable, give the Minister notice of that fact, and

(ii) where a resolution removing an auditor is passed, give notice of that fact in the prescribed form to the registrar of companies within 14 days of the meeting at which the resolution removing the auditor was passed.

(b) If a company fails to give notice as required by paragraph (a) of this subsection, the company and every officer of the company who is in default shall be guilty of an offence and liable, on summary conviction, to a fine not exceeding £1,000.”,

and

(b) by the substitution of the following subsection for subsection (7)—

“(7) The directors of a company or the company in general meeting may fill any casual vacancy in the office of auditor, but while any such vacancy continues, the surviving or continuing auditor or auditors, if any, may act.”.

184. —(1) Section 161 of the Principal Act is hereby amended by the substitution of the following subsections for subsections (1) and (2)—

“(1) Extended notice within the meaning of section 142 shall be required for—

(a) a resolution at an annual general meeting of a company appointing as auditor a person other than a retiring auditor or providing expressly that a retiring auditor shall not be re-appointed,

(b) a resolution at a general meeting of a company removing an auditor before the expiration of his term of office, and

(c) a resolution at a general meeting of a company filling a casual vacancy in the office of auditor.

(2) On receipt of notice of such an intended resolution as is mentioned in subsection (1), the company shall forthwith—

(a) if the resolution is a resolution mentioned in paragraph (a) of the said subsection (1), send a copy thereof to the retiring auditor (if any),

(b) if the resolution is a resolution mentioned in paragraph (b) of the said subsection (1), send a copy thereof to the auditor proposed to be removed, and

(c) if the resolution is a resolution mentioned in paragraph (c) of the said subsection (1), send a copy thereof to the person (if any) whose ceasing to hold the office of auditor of the company occasioned the casual vacancy.

(2A) An auditor of a company who has been removed shall be entitled to attend—

(a) the annual general meeting of the company at which, but for his removal, his term of office as auditor of the company would have expired, and

(b) the general meeting of the company at which it is proposed to fill the vacancy occasioned by his removal, and

to receive all notices of, and other communications relating to, any such meeting which a member of the company is entitled to receive and to be heard at any general meeting that such a member attends on any part of the business of the meeting which concerns him as former auditor of the company.”.

(2) The reference in subsection (5) of the said section 161 to a resolution to remove the first auditors by virtue of subsection (6) of section 160 of the Principal Act shall be construed as including a reference to a resolution to remove an auditor other than the first auditors before the expiration of his term of office.

185. —(1) An auditor of a company may, by a notice in writing that complies with subsection (2) served on the company and stating his intention to do so, resign from the office of auditor to the company; and the resignation shall take effect on the date on which the notice is so served or on such later date as may be specified in the notice.

(2) A notice under subsection (1) shall contain either—

(a) a statement to the effect that there are no circumstances connected with the resignation to which it relates that the auditor concerned considers should be brought to the notice of the members or creditors of the company, or

(b) a statement of any such circumstances as aforesaid.

(3) Where a notice under subsection (1) is served on a company—

(a) the auditor concerned shall, within 14 days after the date of such service, send a copy of the notice to the registrar of companies, and

(b) subject to subsection (4), the company shall, if the notice contains a statement referred to in subsection (2) (b), not later than 14 days after the date of such service send a copy of the notice to every person who is entitled under section 159 (1) of the Principal Act to be sent copies of the documents referred to in the said section 159 (1).

(4) Copies of a notice served on a company under subsection (1) need not be sent to the persons specified in subsection (3) (b) if, on the application of the company concerned or any other person who claims to be aggrieved, the court is satisfied that the notice contains material which has been included to secure needless publicity for defamatory matter and the court may order the company's costs on an application under this section to be paid in whole or in part by the auditor concerned notwithstanding that he is not a party to the application.

(5) This section shall also apply to a notice given by an auditor under section 160 (2) (c) of the Principal Act, indicating his unwillingness to be re-appointed.

(6) A person who fails to comply with subsection (2) or (3) (a) shall be guilty of an offence.

(7) If default is made in complying with subsection (3) (b), the company concerned, and every officer of such company who is in default, shall be guilty of an offence.

186. —(1) A notice served on a company under section 185 which contains a statement in accordance with subsection (2) (b) of that section may also requisition the convening by the directors of the company of a general meeting of the company for the purpose of receiving and considering such account and explanation of the circumstances connected with his resignation from the office of auditor to the company as he may wish to give to the meeting.

(2) Where an auditor makes a requisition under subsection (1), the directors of the company shall, within 14 days of the service on the company of the said notice, proceed duly to convene a general meeting of the company for a day not more than 28 days after such service.

(3) Subject to subsection (4), where—

(a) a notice served on a company under section 185 contains a statement in accordance with subsection (2) (b) of that section, and

(b) the auditor concerned requests the company to circulate to its members—

(i) before the general meeting at which, apart from the notice, his term of office would expire, or

(ii) before any general meeting at which it is proposed to fill the vacancy caused by his resignation or convened pursuant to a requisition under subsection (1),

a further statement in writing prepared by the auditor of circumstances connected with the resignation that the auditor considers should be brought to the notice of the members,

the company shall—

(I) in any notice of the meeting given to members of the company state the fact of the statement having been made, and

(II) send a copy of the statement to the registrar of companies and to every person who is entitled under section 159 (1) of the Principal Act to be sent copies of the documents referred to in the said section 159 (1).

(4) Subsection (3) need not be complied with by the company concerned if, on the application either of the company or any other person who claims to be aggrieved, the court is satisfied that the rights conferred by this section are being abused to secure needless publicity for defamatory matter and the court may order the company's costs on an application under this section to be paid in whole or in part by the auditor concerned notwithstanding that he is not a party to the application.

(5) An auditor of a company who has resigned from the office of auditor shall be permitted by the company to attend—

(a) the annual general meeting at which, but for his resignation, his term of office would have expired, and

(b) any general meeting at which it is proposed to fill the vacancy caused by his resignation or convened pursuant to a requisition of his under subsection (1),

and the company shall send him all notices of, and other communications relating to, any such meeting that a member of the company is entitled to receive and the company shall permit him to be heard at any such meeting which he attends on any part of the business of the meeting which concerns him as a former auditor of the company.

(6) If default is made in complying with subsection (2), (3) or (5), the company concerned, and every officer of the company who is in default, shall be guilty of an offence.

187. —(1) Subject to section 190 , a person shall not be qualified for appointment either as auditor of a company or as a public auditor unless—

(a) (i) he is a member of a body of accountants for the time being recognised by the Minister for the purposes of this section and holds a valid practising certificate from such a body, or

(ii) he holds an accountancy qualification that is, in the opinion of the Minister, of a standard which is not less than that required for such membership as aforesaid and which would entitle him to be granted a practising certificate by that body if he were a member of it, and is for the time being authorised by the Minister to be so appointed, or

(iii) he was, on the 31st day of December, 1990, a member of a body of accountants for the time being recognised under section 162 (1) (a) of the Principal Act, or

(iv) he was authorised by the Minister before the 3rd day of February, 1983, and is for the time being authorised by the Minister to be so appointed, or

(v) he is a person to whom section 188 applies, or

(vi) he is a person to whom section 189 applies, and is for the time being authorised by the Minister to be so appointed, and

(b) the particulars required by sections 199 and 200 in respect of such a person have been forwarded to the registrar of companies.

(2) None of the following persons shall be qualified for appointment as auditor of a company—

(a) an officer or servant of the company,

(b) a person who has been an officer or servant of the company within a period in respect of which accounts would fall to be audited by him if he were appointed auditor of the company,

(c) a parent, spouse, brother, sister or child of an officer of the company,

(d) a person who is a partner of or in the employment of an officer of the company,

(e) a person who is disqualified under this subsection for appointment as auditor of any other body corporate that is a subsidiary or holding company of the company or a subsidiary of the company's holding company, or would be so disqualified if the body corporate were a company,

(f) a person who is disqualified under subsection (3) for appointment as a public auditor of a society that is a subsidiary or holding company of the company or a subsidiary of the company's holding company,

(g) a body corporate.

(3) None of the following persons shall be qualified for appointment as a public auditor of a society—

(a) an officer or servant of the society,

(b) a person who has been an officer or servant of the society within a period in respect of which accounts would fall to be audited by him if he were appointed auditor of the society,

(c) a parent, spouse, brother, sister or child of an officer of the society,

(d) a person who is a partner of or in the employment of an officer of the society,

(e) a person who is disqualified under this subsection for appointment as a public auditor of any other society that is a subsidiary or holding company of the society or a subsidiary of the society's holding company,

(f) a person who is disqualified under subsection (2) for appointment as auditor of a company that is a subsidiary or holding company of the society,

(g) a body corporate.

(4) None of the following persons shall be qualified for appointment as a public auditor of a friendly society—

(a) an officer or servant of the friendly society,

(b) a person who has been an officer or servant of the friendly society within a period in respect of which accounts would fall to be audited by him if he were appointed auditor of the friendly society,

(c) a parent, spouse, brother, sister or child of an officer of the friendly society,

(d) a person who is a partner of or in the employment of an officer of the friendly society,

(e) a body corporate.

(5) A person shall not, by virtue of subsection (3) or (4), be disqualified for appointment as public auditor of a society or a friendly society at any time during the period of 2 years from the commencement of this section if on such commencement he stands duly appointed as public auditor of the society or friendly society, as the case may be.

(6) Subject to subsection (5), a person shall not act as auditor of a company or as a public auditor at a time when he is disqualified under this section for appointment to that office.

(7) If, during his term of office as auditor of a company or public auditor, a person becomes disqualified under the Companies Acts for appointment to that office, he shall thereupon vacate his office and give notice in writing to the company, society or friendly society that he has vacated his office by reason of such disqualification.

(8) This section shall not apply to the Comptroller and Auditor-General.

(9) A person who contravenes subsection (6) or (7) shall be guilty of an offence and liable—

(a) on summary conviction, to a fine not exceeding £1,000, and, for continued contravention, to a daily default fine not exceeding £50, or

(b) on conviction on indictment, to a fine not exceeding £5,000 and, for continued contravention, to a daily default fine not exceeding £100.

(10) (a) In this section “society” means a society registered under the Industrial and Provident Societies Acts, 1893 to 1978.

(b) References in this section to an officer or servant do not include references to an auditor or a public auditor.

(11) A recognition or authorisation by the Minister under section 162 of the Principal Act shall, notwithstanding the repeal of that section by this Act, continue in force as if given under this section—

(a) in the case of a recognition, until the time limit provided expires, or the Minister's decision is communicated to the body concerned, under section 191 , whichever is the earlier, and

(b) in the case of an authorisation, until the time limit for the person to make the notification required by section 199 (3) expires.

188. —(1) Without prejudice to section 187 , a person to whom this section applies shall also be qualified for appointment as auditor of a company or a public auditor.

(2) This section applies to a person—

(a) who on the 1st day of January, 1990, was a person to whom Article 18 of the Council Directive applies, and

(b) who, following his admission, before the 1st day of January, 1996, to the membership of a body of accountants recognised under section 191 , was subsequently awarded a practising certificate by that body, and

(c) in respect of whom such certificate remains valid.

189. —(1) Without prejudice to section 187 , the Minister may declare that, subject to subsection (2), persons who hold—

(a) a qualification entitling them to audit accounts under the law of a specified country outside the State, or

(b) a specified accountancy qualification recognised under the law of a country outside the State,

shall be regarded as qualified for appointment as auditor of a company or a public auditor.

(2) Before making a declaration under subsection (1), the Minister—

(a) must be satisfied that the qualification concerned is of a standard not less than is required by the Companies Acts to qualify a person for appointment as auditor of a company or a public auditor, and

(b) may direct that such a person shall not be treated as qualified for the purposes of subsection (1) unless he holds such additional educational qualifications as the Minister may specify for the purpose of ensuring that such persons have an adequate knowledge of the law and practice in the State relevant to the audit of accounts, and

(c) may have regard to the extent to which persons qualified under the Companies Acts for appointment as auditor of a company or a public auditor are recognised by the law of the country in question as qualified to audit accounts there.

(3) Different directions may be given under subsection (2) (b) in relation to different qualifications.

(4) The Minister may, if he thinks fit, revoke or suspend for a specified period, in such manner and on such conditions as he may think appropriate, any declaration previously made under subsection (1).

190. —(1) Before granting, renewing, withdrawing, revoking, suspending or refusing a recognition of a body of accountants under the Companies Acts, the Minister may consult with any person or body of persons as to the conditions imposed or standards required by the body of accountants concerned in connection with membership of that body or the awarding to persons of practising certificates.

(2) The Minister may also consult with any person or body of persons before forming any opinion or making any declaration in relation to the qualifications held by any person or class of persons as respects qualification for appointment as auditor of a company or a public auditor.

191. —(1) Where a body of accountants recognised under section 162 of the Principal Act satisfies the Minister, within three months after the commencement of this section—

(a) that the standards relating to training, qualifications and repute required by that body for the awarding to a person of a practising certificate are not less than those specified in Articles 3 to 6, 8 and 19 of the Council Directive, and

(b) as to the standards it applies to its members in the areas of ethics, codes of conduct and practice, independence, professional integrity, technical standards, disciplinary procedures,

the Minister shall renew such recognition.

(2) Where a body of accountants referred to in subsection (1) does not satisfy the Minister as to the matters specified in that paragraph, he shall withdraw the recognition of that body until he is so satisfied.

(3) Where a body of accountants which has not previously been recognised by the Minister under section 162 of the Principal Act applies for such recognition after the commencement of this section, the Minister may grant such recognition if he is satisfied as to the matters referred to in subsection (1) in relation to that body or may refuse such recognition if he is not so satisfied.

192. —(1) The Minister may, at the time it is granted or at any time during the currency of a recognition or authorisation under section 187 by notice in writing given to the body of accountants or individual concerned, attach to the recognition or authorisation, as the case may be, such terms and conditions as he thinks necessary or expedient and specified in the notice.

(2) The Minister may, at any time during the currency of a recognition or authorisation under section 187 , by notice in writing given to the body of accountants or individual concerned, amend its terms or conditions or insert into it or delete from it other terms or conditions.

(3) The Minister may, at any time during its currency, by notice in writing given to the body of accountants or individual concerned, revoke, or suspend for a specified period, a recognition or authorisation under the said section 187 .

(4) (a) The Minister may require a body of accountants recognised for the purposes of the said section 187 to prepare and, within such period as may be specified in the requirement, to submit to the Minister for his approval a code prescribing standards of professional conduct for its members and providing for sanctions for breaches of the code, and the body of accountants shall comply with the requirement.

(b) A body of accountants may, at any time, prepare and submit to the Minister a code amending or revoking a code prepared by it under this subsection.

(c) The Minister may approve of a code submitted to him under this subsection.

(d) A code approved of by the Minister under this section shall be brought into operation and enforced by the body of accountants concerned in accordance with its terms.

(e) Where the Minister approves a code under this subsection, he may direct that such provisions of the code as relate to the professional integrity of auditors shall apply, with any necessary modifications approved by the Minister, to persons individually authorised by him.

(f) The Minister may, by regulations, make provision for the function of monitoring compliance by individuals with the code in accordance with paragraph (e). Such regulations may in particular provide for this function to be performed on behalf of the Minister by any body or person specified in the regulations. The regulations may also contain such incidental, consequential, transitional or supplementary provision as may appear to be necessary or proper to ensure compliance with the specified provisions of the code by the individuals concerned.

(g) Every regulation made by the Minister under this section shall be laid before each House of the Oireachtas as soon as may be after it is made and, if a resolution annulling the regulation is passed by either House within the next 21 days on which that House has sat after the regulation is laid before it, the regulation shall be annulled accordingly, but without prejudice to the validity of anything previously done thereunder.

(5) References in this section to recognitions under section 187 include references to recognitions under section 162 (inserted by the Companies (Amendment) Act, 1982 ) of the Principal Act and references in this section to an authorisation under section 187 include references to authorisations under the said section 162.

193. —(1) The auditors of a company shall make a report to the members on the accounts examined by them, and on every balance sheet and profit and loss account, and all group accounts, laid before the company in general meeting during their tenure of office.

(2) The auditors' report shall be read at the annual general meeting of the company and shall be open to inspection by any member.

(3) Every auditor of a company shall have a right of access at all reasonable times to the books, accounts and vouchers of the company and shall be entitled to require from the officers (within the meaning of section 197 (5)) of the company such information and explanations that are within their knowledge or can be procured by them as he thinks necessary for the performance of the duties of the auditors.

(4) The auditors' report shall state—

(a) whether they have obtained all the information and explanations which, to the best of their knowledge and belief, are necessary for the purposes of their audit,

(b) whether, in their opinion, proper books of account have been kept by the company,

(c) whether, in their opinion, proper returns adequate for their audit have been received from branches of the company not visited by them,

(d) whether the company's balance sheet and (unless it is framed as a consolidated profit and loss account) profit and loss account are in agreement with the books of account and returns,

(e) except in the case of a company that has taken advantage of any of the provisions of Part III of the Sixth Schedule to the Principal Act, whether, in their opinion, the company's balance sheet and profit and loss account and (if it is a holding company submitting group accounts) the group accounts have been properly prepared in accordance with the provisions of the Companies Acts and give a true and fair view—

(i) in the case of the balance sheet, of the state of the company's affairs as at the end of its financial year,

(ii) in the case of the profit and loss account (if it is not framed as a consolidated profit and loss account), of the company's profit and loss for its financial year,

(iii) in the case of group accounts submitted by a holding company, of the state of affairs and profit or loss of the company and its subsidiaries dealt with thereby, so far as concerns members of the company,

(f) in the case of a company that has taken advantage of any of the provisions of Part III of the Sixth Schedule to the Principal Act, whether, in their opinion, its balance sheet and profit and loss account and (if it is a holding company submitting group accounts) the group accounts have been properly prepared in accordance with the provisions of the Companies Acts and give a true and fair view of the matters referred to in subparagraphs (i) and (ii) and, where appropriate, subparagraph (iii) of paragraph (e) subject to the non-disclosure of any matters (to be indicated in the report) which by virtue of the said Part III are not required to be disclosed, and

(g) whether, in their opinion, there existed at the balance sheet date a financial situation which under section 40 (1) of the Companies (Amendment) Act, 1983 , would require the convening of an extraordinary general meeting of the company.

(5) The auditors of a company shall be entitled to attend any general meeting of the company and to receive all notices of, and other communications relating to, any general meeting which any member of the company is entitled to receive and to be heard at any general meeting which they attend on any part of the business of the meeting which concerns them as auditors.

(6) A person who is appointed as auditor of a company or as a public auditor shall be under a general duty to carry out such audit with professional integrity.

(7) Any reference in the Principal Act to section 163 of or the Seventh Schedule to that Act shall be construed as references to this section.

194. —(1) If, at any time, the auditors of a company form the opinion that the company is contravening, or has contravened, section 202 by failing to cause to be kept proper books of account (within the meaning of that section) in relation to the matters specified in subsections (1) and (2) of that section, the auditors shall—

(a) serve a notice on the company as soon as may be stating their opinion, and

(b) not later than 7 days after the service of such notice on the company, notify the registrar of companies in the prescribed form of the notice.

(2) Where the auditors form the opinion that the company has contravened section 202 but that, following such contravention, the directors of the company have taken the necessary steps to ensure that proper books of account are kept as required by that section, subsection (1) (b) shall not apply.

(3) This section shall not require the auditors to make the notifications referred to in subsection (1) if they are of opinion that the contraventions concerned are minor or otherwise immaterial in nature.

(4) A person who contravenes subsection (1) shall be guilty of an offence.

195. —(1) If a person who is subject or deemed to be subject to a disqualification order—

(a) becomes, or remains after 28 days from the date of the making of the order, a partner in a firm of auditors,

(b) gives directions or instructions in relation to the conduct of any part of the audit of the accounts of a company, or

(c) works in any capacity in the conduct of an audit of the accounts of a company,

he shall be guilty of an offence.

(2) Where a person is convicted of an offence under subsection (1), the period for which he was disqualified shall be extended for a further period of ten years from such date, or such other further period as the court, on the application of the prosecutor and having regard to all the circumstances of the case, may order.

(3) In this section—

(a) “company” has the meaning assigned to it by section 159, and also includes any society registered under the Industrial and Provident Societies Acts, 1893 to 1978,

(b) “disqualification order” has the meaning assigned to it by section 159.

196. —(1) Where a company (referred to in this section as “the holding company”) has a subsidiary, then—

(a) in case the subsidiary is a body corporate incorporated in the State, it shall be the duty of the subsidiary and its auditors to give to the auditors of the holding company such information and explanations as those auditors may reasonably require for the purposes of their duties as auditors of the holding company,

(b) in any other case, it shall be the duty of the holding company, if required by its auditors to do so, to take all such steps as are reasonably open to it to obtain from the subsidiary such information and explanations as aforesaid.

(2) If a company or an auditor fails to comply with subsection (1) within five days of the making of the relevant requirement under that subsection, the company and every officer thereof who is in default, or the auditor, as the case may be, shall be guilty of an offence.

(3) In a prosecution for an offence under this section, it shall be a defence for the defendant to show that it was not reasonably possible for him to comply with the requirement under subsection (1) to which the offence relates within the time specified in subsection (2) but that he complied therewith as soon as was reasonably possible after the expiration of such time.

(4) A person guilty of an offence under this section shall be liable to a fine.

197. —(1) An officer of a company who knowingly or recklessly makes a statement to which this section applies that is misleading, false or deceptive in a material particular shall be guilty of an offence.

(2) This section applies to any statement made to the auditors of a company (whether orally or in writing) which conveys, or purports to convey, any information or explanation which they require under the Companies Acts, or are entitled so to require, as auditors of the company.

(3) An officer of a company who fails to provide to the auditors of the company or of the holding company of the company, within two days of the making of the relevant requirement, any information or explanations that the auditors require as auditors of the company or of the holding company of the company and that is within the knowledge of or can be procured by the officer shall be guilty of an offence.

(4) In a prosecution for an offence under this section, it shall be a defence for the defendant to show that it was not reasonably possible for him to comply with the requirement under subsection (3) to which the offence relates within the time specified in that subsection but that he complied therewith as soon as was reasonably possible after the expiration of such time.

(5) In this section “officer”, in relation to a company, includes any employee of the company.

198. —(1) The registrar of companies shall maintain a register containing the names and addresses of persons who have been notified to him as qualified for appointment as auditor of a company or as a public auditor.

(2) In this section and in section 199 , “address”, in relation to a person, means his usual residential or business address.

199. —(1) Subject to subsection (2), a body of accountants whose recognition has been renewed by the Minister under section 191 (1) or which has been recognised under section 191 (3) shall, within one month after such renewal or recognition, deliver to the registrar of companies the name and address of each of its members who is qualified for appointment under the Companies Acts as auditor of a company or as a public auditor.

(2) Without prejudice to the generality of subsection (1), a body of accountants based outside the State, whose recognition is renewed or granted as aforesaid, shall notify details of those of its members who wish to practise in the State.

(3) Every person who, immediately before the commencement of this section, holds an authorisation from the Minister under the Companies Acts to act as auditor of a company or as a public auditor (otherwise than by virtue of membership of a recognised body of accountants) shall, within one month after such commencement, deliver his name and address to the registrar of companies.

(4) If default is made in complying with subsection (1), the body of accountants concerned shall be guilty of an offence.

200. —(1) Subject to subsection (2), where, by virtue of his becoming a member of a body of accountants, a person (other than a person referred to in section 199 (1)) becomes qualified for appointment as auditor of a company or as a public auditor, the body concerned shall, within one month of his becoming so qualified, deliver his name and address to the registrar of companies for inclusion in the register referred to in section 198 .

(2) Without prejudice to the generality of subsection (1), a recognised body of accountants based outside the State shall notify details of those of its members who wish to practise in the State.

(3) Every person who, after the commencement of this section, is granted an authorisation by the Minister under the Companies Acts to act as auditor of a company or as a public auditor (otherwise than by virtue of membership of a recognised body of accountants) shall, within one month after such grant, deliver his name and address to the registrar of companies.

(4) If default is made in complying with subsection (1), the body of accountants concerned shall be guilty of an offence.

201. —(1) The Minister may make such supplementary regulations as he considers necessary for the proper and effective implementation of the Council Directive.

(2) Without prejudice to the generality of subsection (1), if, in any respect, any difficulty arises in regard to the implementation of the Directive, the Minister may by regulations do anything which appears to him to be necessary or expedient for removing that difficulty, and any such regulations may modify any provision of this Part so far as may be necessary or expedient to implement the Directive but no regulations shall be made under this subsection in relation to any provision of this Part after the expiration of 3 years commencing on the day on which the relevant provision of this Part came into operation.

(3) Every regulation made by the Minister under this section shall be laid before each House of the Oireachtas as soon as may be after it is made and, if a resolution annulling the regulation is passed by either House within the next 21 days on which that House has sat after the regulation is laid before it, the regulation shall be annulled accordingly, but without prejudice to the validity of anything previously done thereunder.

202. —(1) Every company shall cause to be kept proper books of account, whether in the form of documents or otherwise, that—

(a) correctly record and explain the transactions of the company,

(b) will at any time enable the financial position of the company to be determined with reasonable accuracy,

(c) will enable the directors to ensure that any balance sheet, profit and loss account or income and expenditure account of the company complies with the requirements of the Companies Acts, and

(d) will enable the accounts of the company to be readily and properly audited.

(2) The books of account of a company shall be kept on a continuous and consistent basis, that is to say, the entries therein shall be made in a timely manner and be consistent from one year to the next.

(3) Without prejudice to the generality of subsections (1) and (2), books of account kept pursuant to those subsections shall contain—

(a) entries from day to day of all sums of money received and expended by the company and the matters in respect of which the receipt and expenditure takes place,

(b) a record of the assets and liabilities of the company,

(c) if the company's business involves dealing in goods—

(i) a record of all goods purchased, and of all goods sold (except those sold for cash by way of ordinary retail trade), showing the goods and the sellers and buyers in sufficient detail to enable the goods and the sellers and buyers to be identified and a record of all the invoices relating to such purchases and sales,

(ii) statements of stock held by the company at the end of each financial year and all records of stocktakings from which any such statement of stock has been, or is to be, prepared, and

(d) if the company's business involves the provision of services, a record of the services provided and of all the invoices relating thereto.

(4) For the purposes of subsections (1), (2) and (3), proper books of account shall be deemed to be kept if they comply with those subsections and give a true and fair view of the state of affairs of the company and explain its transactions.

(5) Subject to subsection (6), the books of account shall be kept at the registered office of the company or at such other place as the directors think fit.

(6) If books of account are kept at a place outside the State, there shall be sent to and kept at a place in the State and be at all reasonable times open to inspection by the directors such accounts and returns relating to the business dealt with in the books of account so kept as will disclose with reasonable accuracy the financial position of that business at intervals not exceeding 6 months and will enable to be prepared in accordance with the Companies Acts the company's balance sheet, its profit and loss account or income and expenditure account and any document annexed to any of those documents giving information which is required by the said Acts and is thereby allowed to be so given.

(7) Books of account required by this section to be kept, and accounts and returns referred to in subsection (6), shall be kept either in written form in an official language of the State or so as to enable the books of account and the accounts and returns to be readily accessible and readily convertible into written form in an official language of the State.

(8) A company shall make its books of account, and any accounts and returns referred to in subsection (6), available in written form in an official language of the State at all reasonable times for inspection without charge by the officers of the company and by other persons entitled pursuant to the Companies Acts to inspect the books of account of the company.

(9) A record, being a book of account required by this section to be kept or an account or return referred to in subsection (6), shall be preserved by the company concerned for a period of at least 6 years after the latest date to which it relates.

(10) A company that contravenes this section and a person who, being a director of a company, fails to take all reasonable steps to secure compliance by the company with the requirements of this section, or has by his own wilful act been the cause of any default by the company thereunder, shall be guilty of an offence:

Provided, however, that—

(a) in any proceedings against a person in respect of an offence under this section consisting of a failure to take reasonable steps to secure compliance by a company with the requirements of this section, it shall be a defence to prove that he had reasonable grounds for believing and did believe that a competent and reliable person was charged with the duty of ensuring that those requirements were complied with and was in a position to discharge that duty, and

(b) a person shall not be sentenced to imprisonment for such an offence unless, in the opinion of the court, the offence was committed wilfully.

203. —(1) If—

(a) a company that is being wound up and that is unable to pay all of its debts, has contravened section 202 , and

(b) the court considers that such contravention has contributed to the company's inability to pay all of its debts or has resulted in substantial uncertainty as to the assets and liabilities of the company or has substantially impeded the orderly winding up thereof,

every officer of the company who is in default shall be guilty of an offence and liable—

(i) on summary conviction, to a fine not exceeding £1,000 or to imprisonment for a term not exceeding 6 months or to both, or

(ii) on conviction on indictment, to a fine not exceeding £10,000 or to imprisonment for a term not exceeding 5 years or to both.

(2) In a prosecution for an offence under this section it shall be a defence for the person charged with the offence to show that—

(a) he took all reasonable steps to secure compliance by the company with section 202 , or

(b) he had reasonable grounds for believing and did believe that a competent and reliable person, acting under the supervision or control of a director of the company who has been formally allocated such responsibility, was charged with the duty of ensuring that that section was complied with and was in a position to discharge that duty.

204. —(1) Subject to subsection (2), if—

(a) a company that is being wound up and that is unable to pay all of its debts has contravened section 202 , and

(b) the court considers that such contravention has contributed to the company's inability to pay all of its debts or has resulted in substantial uncertainty as to the assets and liabilities of the company or has substantially impeded the orderly winding up thereof,

the court, on the application of the liquidator or any creditor or contributory of the company, may, if it thinks it proper to do so, declare that any one or more of the officers and former officers of the company who is or are in default shall be personally liable, without any limitation of liability, for all, or such part as may be specified by the court, of the debts and other liabilities of the company.

(2) On the hearing of an application under this subsection, the person bringing the application may himself give evidence or call witnesses.

(3) (a) Where the court makes a declaration under subsection (1), it may give such directions as it thinks proper for the purpose of giving effect to the declaration and in particular may make provision for making the liability of any such person under the declaration a charge on any debt or obligation due from the company to him, or on any mortgage or charge or any interest in any mortgage or charge on any assets of the company held by or vested in him or any company or other person on his behalf, or any person claiming as assignee from or through the person liable under the declaration or any company or person acting on his behalf, and may from time to time make such furtherorder as may be necessary for the purpose of enforcing any charge imposed under this subsection.

(b) In paragraph (a) “assignee” includes any person to whom or in whose favour, by the directions of the person liable, the debt, obligation, mortgage or charge was created, issued or transferred or the interest created, but does not include an assignee for valuable consideration (not including consideration by way of marriage) given in good faith and without notice of any of the matters on the ground of which the declaration is made.

(4) The court shall not make a declaration under subsection (1) in respect of a person if it considers that—

(a) he took all reasonable steps to secure compliance by the company with section 202 , or

(b) he had reasonable grounds for believing and did believe that a competent and reliable person, acting under the supervision or control of a director of the company who has been formally allocated such responsibility, was charged with the duty of ensuring that that section was complied with and was in a position to discharge that duty.

(5) This section shall have effect notwithstanding that the person concerned may be criminally liable in respect of the matters on the ground of which the declaration is to be made.

(6) In this section “officer”, in relation to a company, includes a person who has been convicted of an offence under section 194 , 197 or 242 in relation to a statement concerning the keeping of proper books of account by the company.

205. —Each of the following provisions, that is to say sections 202 to 204 shall apply as respects the accounts of a company for each financial year of the company beginning or ending after such date after the commencement of the provision as may be specified by the Minister by order.

OJ No. L126, 12.5.1984, p.20.