Companies Act 2014 section 274

Interpretation (Part 6): provisions relating to financial statements

Section 274 provides the key definitions and interpretive rules used throughout Part 6 of the Companies Act 2014, which governs the preparation, presentation and disclosure of company financial statements.

• The section defines the main types of financial statements recognised under the Act, including entity financial statements, group financial statements, statutory and non-statutory financial statements, and their IFRS and Companies Act equivalents.
• It clarifies what is meant by core financial statement components such as the balance sheet and profit and loss account, including their IFRS equivalents (statement of financial position and statement of profit or loss and other comprehensive income).
• It explains the "true and fair view" requirement for both Companies Act financial statements and IFRS financial statements, and confirms that references to consolidation mean full (not proportional) consolidation.
• It confirms that directors may fulfil their obligation to prepare financial statements by arranging for others to prepare them on their behalf.