Statutory Instrument 1996 No. 1975

The Occupational Pension Schemes (Requirement to obtain Audited Accounts and a Statement from the Auditor) Regulations 1996

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1996 No. 1975

PENSIONS

The Occupational Pension Schemes (Requirement to obtain Audited Accounts and a Statement from the Auditor) Regulations 1996

Whereas a draft of these Regulations was laid before Parliament in accordance with the provisions of section 175(2) of the Pensions Act 1995^[1] and approved by resolution of each House of Parliament:

Now, therefore, the Secretary of State for Social Security in exercise of powers conferred on him by sections 41(1) and (6), 116(1), 124(1) and 174(2) and (3) of the Pensions Act 1995^[2], and of all other powers enabling him in that behalf, by this instrument, which is made before the end of the period of six months beginning with the coming into force of the provisions of Part I of that Act by virtue of which they are made^[3], hereby makes the following regulations:

Citation, commencement and interpretation
    1.—(1)  These Regulations may be cited as the Occupational Pension Schemes (Requirement to obtain Audited Accounts and a Statement from the Auditor) Regulations 1996 and shall come into force on 6th April 1997.

    (2)  In these Regulations—

"ear-marked scheme" means an occupational pension scheme which is a money purchase scheme under which all the benefits are secured by one or more policies of insurance or annuity contracts and such policies or contracts are specifically allocated to the provision of benefits for individual members or any other person who has a right to benefits under the scheme;
"money purchase scheme" has the same meaning as in section 181(1) of the Pension Schemes Act 1993^[4]; and
"scheme year" means—
 (a) a year specified for the purposes of the scheme in any document comprising the scheme or, if none, a period of 12 months commencing on 1st April or on such date as the trustees or managers select; or
 (b) such other period (if any) exceeding 6 months but not exceeding 18 months as is selected by the trustees or managers in connection with—
 (i) the commencement or termination of the scheme, or
 (ii) a variation of the date on which the year or period referred to in paragraph (a) is to commence.

    (3)  In these Regulations, unless the context otherwise requires, a reference—
 (a) to a numbered regulation is to the regulation bearing that number in these Regulations;
 (b) in a regulation to a numbered paragraph is to the paragraph bearing that number in that regulation.

Requirement of trustees or managers to obtain documents
    2.—(1)  Subject to paragraph (2), where the requirement of section 47(1)(a) of the Pensions Act 1995 (requirement to appoint an individual or a firm as auditor) applies, the trustees or managers of an occupational pension scheme shall obtain not more than seven months after the end of each scheme year which ends on or after 6th April 1997 —
 (a) accounts, prepared in accordance with regulation 3, audited by the auditor;
 (b) the auditor's statement, prepared in accordance with regulation 4, about contributions under the scheme.

    (2)  The requirement to obtain accounts in accordance with paragraph (1)(a) shall not apply to the trustees or managers of an ear-marked scheme.

    (3)  Where the trustees or managers fail to obtain accounts audited by the auditor or the auditor's statement in accordance with paragraph (1), and there is no reasonable excuse for the failure to do so, they are guilty of an offence and liable on summary conviction to a fine not exceeding level 5 on the standard scale.

Form and content of the accounts audited by the auditor
    3.    The accounts audited by the auditor of the scheme shall—
 (a) contain the information specified in the Schedule to these Regulations;
 (b) show a true and fair view of—
 (i) the financial transactions of the scheme during the scheme year;
 (ii) the amount and disposition of the assets at the end of the scheme year;
 (iii) the liabilities of the scheme, other than the liabilities to pay pensions and benefits after the end of the scheme year; and
 (c) contain a report by the auditor as to whether or not in his opinion the requirements of paragraphs (a) and (b) are satisfied.

Form and content of the auditor's statement
    4.    The auditor's statement about contributions under the scheme shall contain—
 (a) a statement as to whether or not in his opinion contributions have been paid in accordance with the schedule of contributions or payment schedule; and
 (b) if the statement under paragraph (a) is negative or qualified, a statement of the reasons.

Signed by authority of the Secretary of State for Social Security.

Oliver Heald

Parliamentary Under-Secretary of State, Department of Social Security.

25th July 1996

[1] 1995 c. 26. back

[2] Section 124(1) is cited because of the meaning ascribed to "prescribed" and "regulations". back

[3] See section 120(2)(c) of the Pensions Act 1995. This provides that the requirement to consult does not apply where regulations are made before the end of six months beginning with the coming into force of the provisions of Part I of the Pensions Act 1995 by virtue of which they are made. back

[4] 1993 c. 48. back

Explanatory Note