11. Section 169 of the principal Act is hereby amended —| (a) | by deleting subsections (5), (6) and (7) thereof and substituting therefor the following new subsections: —| “(5) The directors of a company shall cause to be attached to every balance-sheet made out under subsection (3) of this section a report made in accordance with a resolution of the directors and signed by not less than two of the directors with respect to the profit or loss of the company for the financial year and the state of the company’s affairs as at the end of the financial year. |
(6) Each report to which subsection (5) of this section relates shall state with appropriate details —| (a) | the names of the directors in office at the date of the report; | | (b) | the principal activities of the company in the course of the financial year and any significant change in the nature of those activities during that period; | | (c) | the net amount of the profit or loss of the company for the financial year after provision for income tax; | | (d) | the amounts and particulars of any material transfers to or from reserves or provisions; | | (e) | where, during the financial year, the company has issued any shares or debentures — the purposes of the issue, the classes of shares or debentures issued, the number of shares of each class and the amount of debentures of each class, and the terms of issue of the shares and debentures of each class; | | (f) | whether at the end of that financial year, there subsist arrangements to which the company is a party, being arrangements whose objects are, or one of whose objects is, to enable directors of the company to acquire benefits by means of the acquisition of shares in, or debentures of, the company or any other body corporate, or there have, at any time in that year, subsisted such arrangements as aforesaid to which the company was a party, and if so the report shall contain a statement explaining the effect of the arrangements and giving the names of the persons who at any time in that year were directors of the company and held, or whose nominees held, shares or debentures acquired in pursuance of the arrangements; | | (g) | as respects each person who, at the end of the financial year, was a director of the company, whether or not (according to the register kept by the company for the purposes of section 134 of this Act relating to the obligation of a director of a company to notify it of his interests in shares in, or debentures of, the company and of every other body corporate, being the company’s subsidiary or holding company or a subsidiary of the company’s holding company) he was, at the end of that year, interested in shares in, or debentures of, the company or any other such body corporate and, if he was, the number and amount of shares in, and debentures of, each body (specifying it) in which, according to that register, he was then interested and whether or not, according to that register, he was, at the beginning of that year (or, if he was not then a director, when he became a director), interested in shares in, or debentures of, the company or any other such body corporate and, if he was, the number and amount of shares in, and debentures of, each body (specifying it) in which, according to that register, he was interested at the beginning of that year or, as the case may be, when he became a director; | | (h) | the amount, if any, which the directors recommend should be paid by way of dividend, and any amounts which have been paid or declared by way of dividend since the end of the previous financial year, indicating which of those amounts (if any) have been shown in a previous report under this subsection or under a corresponding previous enactment; | | (i) | whether the directors (before the profit and loss account and balance-sheet were made out) took reasonable steps to ascertain what action had been taken in relation to the writing off of bad debts and the making of provision for doubtful debts, and satisfied themselves that all known bad debts had been written off and that adequate provision had been made for doubtful debts; | | (j) | whether at the date of the report the directors are aware of any circumstances which would render the amount written off for bad debts or the amount of the provision for doubtful debts inadequate to any substantial extent (and, if so, giving particulars of the circumstances); | | (k) | whether the directors (before the profit and loss account and balance-sheet were made out) took reasonable steps to ensure that any current assets which were unlikely to realize in the ordinary course of business their value as shown in the accounting records of the company were written down to an amount which they might be expected so to realize; | | (l) | whether at the date of the report the directors are aware of any circumstances which would render the values attributed to current assets in the accounts misleading (and, if so, giving particulars of the circumstances); | | (m) | whether there exists at the date of the report —| (i) | any charge on the assets of the company which has arisen since the end of the financial year which secures the liabilities of any other person (and, if so, giving particulars of any such charge and, so far as practicable, of the amount secured); and | | (ii) | any contingent liability which has arisen since the end of the financial year (and, if so, stating the general nature thereof and, so far as practicable, the maximum amount, or an estimate of the maximum amount, for which the company could become liable in respect thereof); 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| | (n) | whether any contingent or other liability has become enforceable, or is likely to become enforceable, within the period of twelve months after the end of the financial year which, in the opinion of the directors, will or may affect the ability of the company to meet its obligations when they fall due (and, if so, giving particulars of any such liability); | | (o) | whether at the date of the report the directors are aware of any circumstances not otherwise dealt with in the report or accounts which would render any amount stated in the accounts misleading (and, if so, giving particulars of the circumstances); | | (p) | whether the results of the company’s operations during the financial year were, in the opinion of the directors, substantially affected by any item, transaction or event of a material and unusual nature (and, if so, giving particulars of that item, transaction or event and the amount or the effect thereof, if known or reasonably ascertainable); and | | (q) | whether there has arisen in the interval between the end of the financial year and the date of the report any item, transaction or event of a material and unusual nature likely, in the opinion of the directors, to affect substantially the results of the company’s operations for the financial year in which the report is made (and, if so, giving particulars of the item, transaction or event). |
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(7) In subsection (1) of this section, the expression “any item, transaction or event of a material and unusual nature” includes but is not limited to —| (a) | any change in accounting principles adopted since the last report; | | (b) | any material change in the method of valuation of the whole or any part of the trading stock; | | (c) | any material item appearing in the accounts or consolidated accounts for the first time or not usually included in the accounts or consolidated accounts; and | | (d) | any absence from the accounts or consolidated accounts of any material item usually included in the accounts or consolidated accounts. |
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| (8) The directors of a company shall state in the report whether since the end of the previous financial year a director of the company has received or become entitled to receive a benefit (other than a benefit included in the aggregate amount of emoluments received or due and receivable by the directors shown in the accounts or the fixed salary of a full-time employee of the company) by reason of a contract made by the company or a related corporation with the director or with a firm of which he is a member, or with a company in which he has a substantial financial interest, and, if so, the general nature of the benefit. |
| (9) Every statement, report or other document relating to the affairs of a company or any of its subsidiaries attached to, or included with, a report of the directors laid before the company at its general meeting or sent to the members under section 170 of this Act (not being a statement, report or document required by this Act to be laid before the company in general meeting) shall, for the purposes of section 364 of this Act, be deemed to be part of that last-mentioned report. |
| (10) Where at the end of a financial year a company is the subsidiary of another corporation the directors of the company shall state in, or in a note as a statement annexed to, the company accounts laid before the company at its annual general meeting the name of the corporation regarded by the directors as being the company’s holding company and if known to them the country in which it is incorporated.”; and |
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| | (b) | by renumbering the existing subsections (8), (9), (10), (11), (12), (13), (14), (15) and (16) thereof as subsections (11), (12), (13), (14), (15), (16), (17), (18) and (19) respectively. |
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