Concise Accountancy

Accountants and Registered Auditors

Company accounts


A Subsidiary company has different financial reporting requirements under the Companies Act 2006. Generally, a company is a subsidiary of its holding company if either or combination of the following relationship exists.

The holding company:

  1. Holds a majority of the shareholders’ voting rights in it.
  2. Is a member of the subsidiary. It has the right to appoint or remove directors. It also holding a majority of voting right at meetings of its board of directors.
  3. Is a member of the subsidiary and controls alone, pursuant to an agreement with other shareholders and members, a majority of the voting rights in it.
  4. Has the right to exercise a dominant influence over it by virtue of provisions in the subsidiary’s Memorandum or Articles or by a control contract.
  5. Exercises a dominant influence over. It also has the power to exercise a dominant influence over, or is managed on a unified basis with, the company.
  6. May also be a subsidiary of another, Through an intermediate parent company.

Subsidiary group accounts

In general, a subsidiary company of which it is also a parent company to other subsidiaries may require to prepare group accounts. Accordingly, to consolidate profit and loss accounts if assets and turnover exceed the group accounts preparation exemption threshold.

Audited company accounts

On one hand, a subsidiary company which is part of group of companies listed in the Stock Exchange is not eligible to file abridged accounts. Even though it meets the small and medium sized company criteria. In this circumstance, the company must submit an audited company accounts with Companies House.

Confirmation statement

Another key point, the company must also deliver Confirmation statement to Companies House. Failure to submit your confirmation statement is a criminal offence. Consequently, all your company officers are liable to fines and imprisonment.

Seek accountant advice if you have any questions about a subsidiary company accounts preparation or filing your confirmation statement.

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