Accounting records

The following In House Advisor guidance note provides comprehensive and up to date legal information covering:

  • Accounting records
  • Brexit impact
  • The duty to keep accounting records
  • Where and for how long must accounting records be kept

A company must comply with statutory provisions set out in the Companies Act 2006 (CA 2006) in relation to keeping accounting records.Companies Act 2006, ss 386–389

In addition, there may be other rules relating to accounting records that apply alisted company, an AIM company or acompany with securities that are listed on the NEX Exchange Main Board, NEX Exchange Growth Market or NEX Exchange Secondary Market, but these are outside the scope of this Practice Note.Financial Conduct Authority Handbook, Glossary, definition of listed companyAIM Rules for Companies, Glossary, definition of AIM company

Some or all of the statutory provisions relating to accounting records may also apply to other companies and entities, but this issue is outside the scope of this Practice Note.

Brexit impact

The UK corporate reporting framework may be affected by Brexit. For further details of its impact, see Brexit—accounts and reports.

The duty to keep accounting records

All companies must keep adequate accounting records. Their purpose is to ensure that businesses record transactions to enable them to show the company's financial position and to prepare accounts which comply with the CA 2006 and, where relevant, with International Accounting Standards.CA 2006, s 386(1)Companies Act 2006 explanatory notes, para 639

Accounting records is adeliberately broad term that is not specifically defined as the records of acompany may differ depending on the nature and complexity of its business. For asimple business, accounting records might include, bank statements, purchase orders, sales and purchase invoices, whilst amore sophisticated business may have integrated records, which it holds electronically.Companies Act 2006 explanatory notes, para 639

Provided that