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DTR 4.1 Annual financial report

Application

[Note: ESMA has also issued guidelines under article 16(3) of the ESMA Regulation on enforcement of financial information, 10 July 2014/ESMA/2014/8076]
DTR 4.1.1RRP

1Subject to the exemptions set out in DTR 4.4 (Exemptions) this section applies to an issuer whose transferable securities are admitted to trading.6

Compliance with the Listing Rules

DTR 4.1.2GRP

An issuer that is also admitted to the official list should consider its obligations under the Listing Rules in addition to the requirements in these rules.

Publication of annual financial reports

DTR 4.1.3RRP

An issuer must make public its annual financial report at the latest four months after the end of each financial year.

[Note: article 4(1) of the TD]

DTR 4.1.4RRP

An issuer must ensure that its annual financial report remains publicly available for at least ten3 years.

[Note: article 4(1) of the TD]

Content of annual financial reports

DTR 4.1.5RRP

The annual financial report must include:

  1. (1)

    the audited financial statements;

  2. (2)

    a management report; and

  3. (3)

    responsibility statements.

[Note: article 4(2) of the TD]

Audited financial statements

DTR 4.1.6RRP
  1. (1)

    If an issuer is required to prepare consolidated accounts6,the audited financial statements must comprise:

    1. (a)

      consolidated accounts prepared in accordance with UK-adopted IFRS6, and

    2. (b)

      accounts of the parent company prepared in accordance with the law of the United Kingdom6.

    [Note: article 4(3) of the TD]

  2. (2)

    If an issuer is not required to prepare consolidated accounts, the audited financial statements must comprise accounts prepared in accordance with the law of the United Kingdom6.

    [Note: article 4(3) of the TD]

Auditing of financial statements

DTR 4.1.7RRP
  1. (1)

    The6 financial statements must be audited in accordance with Part 16 of the Companies Act 20066.

  2. (2)

    [deleted]6

  3. (3)

    The audit report, signed by the person or persons responsible for auditing the financial statements must be disclosed in full to the public together with the annual financial report.

[Note: article 4(4) of the TD]

  1. (4)

    An issuer which is a UK-traded third country company6 within the meaning of section 1241 of the Companies Act 2006 must ensure that the person who provides the audit report is:2

    1. (a)

      on the register of third country auditors kept for the purposes of regulation 6 of the Statutory Auditors and Third Country Auditors Regulations 2013 (SI 2013/1672)4; or2

    2. (b)

      eligible for appointment as a statutory auditor under section 1212 of the Companies Act 2006.6

      2
    3. (c)

      [deleted]6

      2

[Note: Article 45(4) of the Audit Directive]2

Content of management report

DTR 4.1.8RRP

The management report must contain:

  1. (1)

    a fair review of the issuer's business; and

  2. (2)

    a description of the principal risks and uncertainties facing the issuer.

    4[Note: article 4(5) of the TD]

DTR 4.1.9RRP

The review required by DTR 4.1.8 R must:

  1. (1)

    be a balanced and comprehensive analysis of:

    1. (a)

      the development and performance of the issuer's business during the financial year; and

    2. (b)

      the position of the issuer's business at the end of that year,

    consistent with the size and complexity of the business;

  2. (2)

    include, to the extent necessary for an understanding of the development, performance or position of the issuer's business:

    1. (a)

      analysis using financial key performance indicators; and

    2. (b)

      where appropriate, analysis using other key performance indicators including information relating to environmental matters and employee matters; and

  3. (3)

    include references to, and additional explanations of, amounts included in the issuer's annual financial statements, where appropriate.

4[Note: article 4(5) of the TD]

DTR 4.1.10GRP

In DTR 4.1.9 R (2), key performance indicators are factors by reference to which the development, performance or position of the issuer's business can be measured effectively.

DTR 4.1.11RRP

The management report required by DTR 4.1.8 R must also give an indication of:

  1. (1)

    any important events that have occurred since the end of the financial year unless those events are:4

    1. (a)

      4reflected in the issuer’s profit and loss account or balance sheet; or

    2. (b)

      4disclosed in the notes to the issuer’s audited financial statements;

  2. (2)

    the issuer's likely future development;

  3. (3)

    activities in the field of research and development;

  4. (4)

    the information concerning acquisitions of own shares prescribed by the United Kingdom provisions which implemented6 article 24(2) of Directive 2012/30/EU4;

  5. (5)

    the existence of branches of the issuer; and

  6. (6)

    in relation to the issuer's use of financial instruments and where material for the assessment of its assets, liabilities, financial position and profit or loss:

    1. (a)

      the issuer's financial risk management objectives and policies, including its policy for hedging each major type of forecasted transaction for which hedge accounting is used, and

    2. (b)

      the issuer's exposure to price risk, credit risk, liquidity risk and cash flow risk.

4[Note: article 4(5) of the TD]

Responsibility statements

DTR 4.1.12RRP
  1. (1)

    Responsibility statements must be made by the persons responsible within the issuer.

  2. (2)

    The name and function of any person who makes a responsibility statement must be clearly indicated in the responsibility statement.

  3. (3)

    For each person making a responsibility statement, the statement must set out that to the best of his or her knowledge:

    1. (a)

      the financial statements, prepared in accordance with the applicable set of accounting standards, give a true and fair view of the assets, liabilities, financial position and profit or loss of the issuer and the undertakings included in the consolidation taken as a whole; and

    2. (b)

      the management report includes a fair review of the development and performance of the business and the position of the issuer and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face.

[Note: article 4(2)(c) of the TD]

DTR 4.1.13RRP

The issuer is responsible for all information drawn up and made public in accordance with this section.

Reporting format

DTR 4.1.14R

[deleted]8

57
DTR 4.1.15R

8The annual financial report must be prepared in Extensible Hypertext Markup Language (XHTML) format.

DTR 4.1.16R

8DTR 4.1.17R and DTR 4.1.18R apply to an annual financial report that contains consolidated accounts prepared in accordance with:

  1. (1)

    UK-adopted IFRS;

  2. (2)

    EU-adopted IFRS; or

  3. (3)

    International Financial Reporting Standards as referred to in point (a) of the first subparagraph of Article 1 of the TD Equivalence Decision.

DTR 4.1.17R

8An issuer:

  1. (1)

    must mark up any disclosures specified in DTR 4 Annex 1R that are present in consolidated financial statements in the annual financial report; and

  2. (2)

    may mark up other disclosures in the consolidated financial statements in addition to the ones specified in DTR 4 Annex 1R.

DTR 4.1.18R

8The mark ups specified in DTR 4.1.17R must use:

  1. (1)

    the Extensible Business Reporting Language (XBRL) markup language;

  2. (2)

    a taxonomy generally accepted in the UK for financial disclosures in regulated markets; and

  3. (3)

    the inline XBRL specifications and marking up and filing requirements specified by the taxonomy the issuer uses in (2).

[Note: Information on generally accepted taxonomies and associated marking up and filing requirements is available in the Markets section of the FCA’s website at https://www.fca.org.uk/markets/company-annual-financial-reporting-electronic-format]

DTR 4.1.19R

8An issuer must comply with DTR 4.1.17R to DTR 4.1.18R if it wishes to mark up financial statements that:

  1. (1)

    are prepared in accordance with the accounting standards referred to in DTR 4.1.16R; and

  2. (2)

    do not contain consolidated accounts.

DTR 4.1.20R

8An issuer must not mark up an annual financial report if the accounts in the report are not prepared in accordance with the accounting standards referred to in DTR 4.1.16R.

DTR 4.1.21G

8The effect of DTR 4.1.20R is that an issuer cannot mark up an annual financial report containing accounts prepared in accordance with:

  1. (1)

    section 396 (Companies Act individual accounts) or section 404 (Companies Act group accounts) of the Companies Act 2006; or

  2. (2)

    the Generally Accepted Accounting Principles of a third country.

DTR 4.1.22R

8An issuer must not mark up disclosures in its annual financial report other than its financial statements unless:

  1. (1)

    it marks up its financial statements in accordance with DTR 4.1.16R to DTR 4.1.18R or DTR 4.1.19R, whichever is applicable; and

  2. (2)

    it marks up those other disclosures using the inline XBRL markup language and a taxonomy specific to those other parts.

Filing of the annual financial report

DTR 4.1.23G

8Issuers are reminded of the filing requirements for annual financial reports in DTR 6.2.