These regulations regard the disclosure of certain information by some large undertakings and groups, namely non-financial and diversity information, and make amendments to article 23(1) of the Accounting Directive.
The Accounting Directive only applies to certain undertakings of limited liability, and ensures that the parent company of small companies must produce group accounts if a member of the group is established under the law of an EEA State.
Regulation 4 inserts two new sections, 414CA and 414CB, to provide additional information. Company directors must produce a strategic report every financial year, and a group report if they direct the parent company of a group. 414CA requires large companies and companies with more than 500 employees in a financial year to produce a non-financial statement as part of their report (section 414CB sets out the requirements for this). This does not apply to companies that are subsidiaries as long as they are included in a group strategic report or consolidated management report of an EEA undertaking.
Certain information can be withheld from the financial report or non-financial statement, such as information that the company directors feel would be seriously prejudicial to the commercial interests of the company.