405 Companies Act group accounts: subsidiary undertakings included in the consolidation
405 Companies Act group accounts: subsidiary undertakings included in the consolidation
Companies Act 2006 | Legislation

(1)     Where a parent company prepares Companies Act group accounts, all the subsidiary undertakings of the company must be included in the consolidation, subject to the following exceptions.

(2)     A subsidiary undertaking may be excluded from consolidation if its inclusion is not material for the purpose of giving a true and fair view (but two or more undertakings may be excluded only if they are not material taken together).

(3)     A subsidiary undertaking may be excluded from consolidation where—

(a)     severe long-term restrictions substantially hinder the exercise of the rights of the parent company over the assets or management of that undertaking, or