The passage of the Corporate Insolvency and Governance Act 2019-21 into law on 25 June has provided an important lifeline to companies and other entities that may presently be dealing with financial difficulties in the wake of the ongoing corona virus pandemic.
The extension incorporated into the Act of the period for filing public company accounts is just one aspect of the legislation that impacts on the operations of such firms. Nonetheless, it is a potentially very significant one for many companies.
How has the period to file public company accounts been extended?
The Act includes a provision for a temporary extension of the period within which a public company is required to file its accounts and reports with Companies House, where section 442 of the Companies Act 2006 necessitates such accounts to be filed on a date between 25 March 2020 and 30 September 2020.
In the changed circumstances of the COVID-19 crisis, the new law now considers the period within which directors are allowed to file the accounts to be a period ending on the earlier of 30 September 2020, and the last day of the 12-month period immediately after the conclusion of the relevant accounting reference period.
To provide an example, a given public company’s accounting reference period may end on 1 December 2019 – thereby meaning that in accordance with the aforementioned section of the Companies Act 2006, the directors are required to file the company’s accounts and reports on or before 1 June 2020. The Corporate Insolvency and Governance Act 2020, however, extends this deadline to 30 September 2020.
Powers have also been put in place to extend filing periods
Another clause in the Act hands temporary powers to the Secretary of State to introduce regulations that extend the period during which particular returns or filings are required to be lodged with Companies House.
This provision has been put in place in recognition of the difficulties that the circumstances created by the corona virus pandemic may bring for companies in their efforts to meet existing statutory filing deadlines.
Listed in the Act are the relevant filing deadlines that may be subject to an extension. They include the periods for filing company accounts and annual confirmation statements, as well as for registering a charge under section 859A or 859B of the Companies Act 2006.
Also potentially able to be extended under the new law are the periods for making certain event-driven filings – such as notifying a change in directors or registered office – under the Companies Act 2006, as well as for registering changes to a limited partnership in accordance with section 9 of the Limited Partnerships Act 1907, and for notice of membership changes in accordance with section 9 of the Limited Liability Partnerships Act 2000.
In the event of these powers being exercised, the extended filing period is not permitted to exceed 42 days, in a case where the existing filing period is 21 days or less. If the existing filing period is between three and nine months, meanwhile, the extended filing period must not exceed 12 months.
Finally, the Act also has a clause conferring that these temporary powers to extend the various filing periods expire at the end of the day on 5 April 2021. The expiry of these powers, however, will not impact on the continued operation of any regulations made under this section of the legislation for the purpose of determining the length of any period beginning prior to the expiry.
We can be by your company’s side
Do you have any further questions about the implications of the Corporate Insolvency and Governance Act 2020 for your own organisation?
If so, our corporate governance experts – with their know-how in such key areas as company secretarial practice for PLCs, minute book maintenance and Companies House filing deadlines – are ready and waiting to provide the necessary targeted advice and support.
Give us a call or send us an email today, and we will gladly answer your queries and – if needed – guide you through our own solutions that could aid your company through these unstable and unpredictable times.