The committee of management of every friendly society or registered branch must prepare accounts for the society or branch for each of its financial years. Those accounts are referred to in this Part as the society’s or branch’s “individual accounts”.

After the first financial year in which the committee of management of a friendly society or registered branch prepares IAS individual accounts (“the first IAS year”), all subsequent individual accounts of the society or branch must be prepared in accordance with F15UK-adopted international accounting standards unless there is a relevant change of circumstance. F23This is subject to subsection (4A).

After a financial year in which the committee of management of a friendly society or registered branch prepares IAS individual accounts, the committee of management may change to preparing Friendly Societies Act individual accounts for a reason other than a relevant change of circumstance provided it has not changed to Friendly Societies Act individual accounts in the period of five years preceding the first day of that financial year.

In calculating the five year period for the purpose of subsection (4A), no account should be taken of a change due to a relevant change of circumstance.

If, having changed to preparing Friendly Societies Act individual accounts F7..., the committee of management again prepares IAS individual accounts for the society or branch, subsections (3) and (4) apply again as if the first financial year for which such accounts are again prepared were the first IAS year.

The balance sheet must give a true and fair view of the state of affairs of the society or branch as at the end of the financial year; and the income and expenditure account must give a true and fair view of the income and expenditure of the society or branch for the financial year.

Friendly Societies Act individual accounts must comply with the requirements of regulations made under section 69C as to the form and content of the balance sheet and income and expenditure account and additional information to be provided by way of notes to the accounts or otherwise.

Where compliance with the provisions of those regulations, and the other provisions of this Act as to the matters to be included in a society’s or branch’s individual accounts or in notes to those accounts, would not be sufficient to give a true and fair view, the necessary additional information must be given in the accounts or in a note to them.

If in special circumstances compliance with any of those provisions is inconsistent with the requirement to give a true and fair view, the committee of management must depart from that provision to the extent necessary to give a true and fair view.

Particulars of any such departure, the reasons for it and its effect must be given in a note to the accounts.

The Treasury must by regulations make provision with respect to the form and content of Friendly Societies Act individual accounts.

The Treasury may by regulations make provision with respect to additional information to be contained in Friendly Societies Act individual accounts, whether in the form of notes or otherwise.

If at the end of a financial year an incorporated friendly society has subsidiary undertakings, the committee of management, in addition to preparing individual accounts for the year, must prepare consolidated accounts for the year for the society and those undertakings taken as a whole, except as provided by regulations under subsection (7).

Those accounts are referred to in this Part as the society’s “group accounts”.

Certain friendly societies are obliged by F30section 403(1) of the Companies Act 2006 to prepare their group accounts in accordance with F25UK-adopted international accounting standards (“IAS group accounts”).

The group accounts of a friendly society that is a charity must be Friendly Societies Act group accounts.

After the first financial year in which the committee of management of a friendly society prepares IAS group accounts (“the first IAS year”), all subsequent group accounts of the society must be prepared in accordance with F12UK-adopted international accounting standards unless there is a relevant change of circumstance. F13This is subject to subsection (5A).

After a financial year in which the committee of management of a friendly society prepares IAS group accounts, the committee of management may change to preparing Friendly Societies Act group accounts for a reason other than a relevant change of circumstance provided it has not changed to Friendly Societies Act group accounts in the period of five years preceding the first day of that financial year.

In calculating the five year period for the purpose of subsection (5A), no account should be taken of a change due to a relevant change of circumstance.

If, having changed to preparing Friendly Societies Act group accounts F20..., the committee of management again prepares IAS group accounts for the society, subsections (4) and (5) apply again as if the first financial year for which such accounts are again prepared were the first IAS year.

The Treasury may by regulations exempt specified descriptions of incorporated friendly societies with subsidiaries from any duty to prepare group accounts.

Regulations under subsection (7) may exempt societies by reference to any criterion and may make different provision for different descriptions of societies.

In this subsection “UK regulated market” has the meaning given in Article 2.1.13A of Regulation (EU) No. 600/2014 of the European Parliament and of the Council of 15 May 2014 and amending Regulation (EU) No. 648/2012.

Friendly Societies Act group accounts must give a true and fair view of the state of affairs as at the end of the financial year, and the income and expenditure for the financial year, of the society and the subsidiary undertakings included in the group accounts as a whole, so far as concerns the members of the society.

Friendly Societies Act group accounts must comply with the requirements of regulations made under section 69G as to the form and content of the group accounts and additional information to be provided by way of notes to the accounts or otherwise.

Where compliance with the provisions of those regulations, and the other provisions of this Act as to the matters to be included in a society’s group accounts or in notes to those accounts, would not be sufficient to give a true and fair view, the necessary additional information must be given in the accounts or in a note to them.

If in special circumstances compliance with any of those provisions is inconsistent with the requirement to give a true and fair view, the committee of management must depart from that provision to the extent necessary to give a true and fair view.

Particulars of any such departure, the reasons for it and its effect must be given in a note to the accounts.

The Treasury must by regulations make provision with respect to the form and content of Friendly Societies Act group accounts.

The Treasury may by regulations make provision with respect to additional information to be contained in Friendly Societies Act group accounts, whether in the form of notes or otherwise.

Subsection (1) does not require accounts of undertakings that are charities to be prepared using the same financial reporting framework as accounts of undertakings which are not charities.

Subsection (1)(a) does not apply where the committee of management of a friendly society prepares IAS group accounts and IAS individual accounts.

The committee of management of a society which has subsidiary undertakings must ensure that, except where in its opinion there are good reasons against it, the financial year of each of its subsidiary undertakings coincides with the society’s own financial year.

The information specified in Schedule 13D must be given in notes to a friendly society’s or a registered branch’s annual accounts, subject to the provisions of subsection (5).

In that Schedule—

• Part 1 relates to emoluments and other benefits of members of the committee of management and others and to loans and other dealings in favour of members of the committee and connected persons; and

• Part 2 relates to information about the employees of a society.

It is the duty of any member of the committee of management, and any person who has been at any time in the preceding five years a member of the committee, to give notice to the society of such matters relating to himself as may be necessary for the purposes of Part 1 of Schedule 13D.

A person who makes default in complying with subsection (3) commits an offence and is liable on summary conviction to a fine not exceeding level 3 on the standard scale.

Paragraphs 11 and 13 of Schedule 13D do not apply to non-directive friendly societies or their registered branches.

The annual accounts of a friendly society which is required to produce group accounts under section 69E must include the material specified by paragraphs 11 to 13 not only in respect of the society but also in respect of the society and its subsidiaries in combination.

The Treasury may, by order, modify the provisions of Schedule 13D.

The information specified in Schedule 13E must be given in notes to a friendly society’s or a registered branch’s annual accounts.

In the case of a friendly society whose committee of management is not required to prepare consolidated accounts, the information specified in Part 1 of that Schedule must be given.

In the case of a friendly society whose committee of management is required to prepare consolidated accounts, the information specified in Part 2 of that Schedule must be given.

The Treasury may, by order, modify the provisions of Schedule 13E.

The information need only be given to the extent necessary for enabling the financial position of the society or branch to be assessed.

Where a friendly society is required to prepare consolidated group accounts, this section applies in relation to those accounts as if the undertakings included in the consolidation were a single friendly society.

The information specified in Schedule 13F must be given in notes to a friendly society’s or a registered branch’s annual accounts.

The Treasury may, by order, modify the provisions of Schedule 13F.