Companies Act 2014 section 301

Exemption from consolidation: holding company with all of its subsidiary undertakings excluded from consolidation

Section 301 provides an exemption from the requirement to prepare group financial statements where every subsidiary undertaking of a holding company qualifies for exclusion from consolidation.

• A holding company is normally required to prepare consolidated (group) financial statements covering itself and its subsidiary undertakings.
• Section 303 of the Companies Act 2014 sets out specific grounds on which individual subsidiary undertakings may be excluded from consolidation.
• If every one of the holding company's subsidiary undertakings qualifies for exclusion under section 303(2) or 303(3), the holding company is fully exempt from preparing group financial statements.
• This exemption recognises that there is no practical benefit in preparing consolidated accounts when no subsidiary undertaking would actually be included in them.