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Partnership accounts


The Partnerships (Accounts) Regulations 2008 require companies which are members of 'qualifying partnerships' to prepare and attach accounts of the partnership to their own accounts.

1. What is a qualifying partnership?

A qualifying partnership is a partnership formed under the law of any part of the United Kingdom if each of the members is:

a limited company; or
an unlimited company or a Scottish partnership, each of whose members is a limited company.
The partnership regulations will apply to most limited partnerships that have limited companies as their general partners and are registered under the Limited Partnerships Act 1907, as these partnerships must have their principal place of business in Great Britain on registration.

Note
(a) Any reference to a qualifying partnership in relation to a limited partnership is a reference to the general partners only; and
(b) Any reference to a limited company, an unlimited company, or a partnership (including a Scottish partnership) includes any comparable undertaking formed under the laws of any country or territory outside the United Kingdom.

2. What accounts must the partnership prepare?

The partnership must produce audited accounts as if it were a company. The accounts must conform to the requirements of the Companies Act 2006 and related regulations.

Under Regulation 7 of The Partnerships (Accounts) Regulations 2008, members of a qualifying partnership do not have to prepare partnership accounts if the partnership is dealt with on a consolidated basis in group accounts prepared by either:

a member of the partnership which is established under the law of a member state of the European Economic Area (EEA); or
a parent undertaking of such a member.
In these cases, the group accounts must be prepared and audited under the law of the member state in accordance with the Seventh Company Law Directive or International Accounting Standards. A note to the group accounts must disclose that advantage has been taken of this exemption.

3. For what period must I prepare the partnership accounts?

The accounts may cover any period up to 18 months which may be specified in the partnership agreement. If the partnership agreement does not specify a period, you must draw up the accounts for each 12 month period ending on 31 March in each year.

4. When must I prepare the accounts?

You must prepare the partnership accounts within a period of 9 months after the end of the financial year.

5. When must I deliver and publish the accounts?

If you are a limited company which is a member of a qualifying partnership, you must attach the partnership accounts to the next accounts which you deliver to Companies House. You must also supply to any person on request:

the name of each partner required to deliver copies of the partnership accounts to Companies House; and
the name of each partner incorporated in another EEA member state who is required to publish the partnership accounts in that state.
When a qualifying partnership has its head office in the United Kingdom and each of the partners is:

an undertaking comparable to a limited company incorporated outside the United Kingdom or other EEA state; or
an undertaking comparable to an unlimited company or partnership formed under the law of such a country with each of its members a limited or comparable undertaking;
then the partnership must:

make the latest accounts of the partnership available for inspection by any person, without charge, during business hours at the head office of the partnership, together with a certified translation, if the original is not in English; and
each member of the partnership must:

supply to any person on request a copy of the latest accounts of the partnership (together with a translation if the original is not in English). A fee may be charged to cover the administrative cost of supplying the copy, but no more.


6. Are there any exemptions from the publication rules?

Under regulation 7 of The Partnerships (Accounts) Regulations 2008, members of a qualifying partnership do not have to publish partnership accounts if the partnership is dealt with on a consolidated basis in group accounts prepared by either:

a member of the partnership which is established under the law of a member state of the European Economic Area (EEA); or
a parent undertaking of such a member.
In these cases, they must prepare and audit group accounts under the law of the member state in accordance with the Seventh Company Law Directive or international accounting standards. A note to the group accounts must disclose that they have taken advantage of this exemption.

7. Are there any penalties for non-compliance?

Yes. Every partner in a qualifying partnership or every director of a company that is a partner may be prosecuted and fined up to £5,000.

8. What are the audit requirements?

The Partnerships (Accounts) Regulations 2008 contain requirements relating to the appointment and dismissal of auditors, signature of auditors’ reports and disclosure of auditors’ remuneration equivalent to the requirements on companies.