The Department for Business, Energy and Industrial Strategy (BEIS) has published guidance for companies and Limited Liability Partnerships (LLPs) who need to comply with regulations establishing a new statutory reporting duty for payment practices and performance. These regulations require the UK’s largest companies and LLPs to report on a half-yearly basis details of their payment practices and policies for financial years beginning on or after 6 April 2017. The stated aim is to boost transparency of payment practices to help small and medium sized businesses (SMEs).
Introducing the guidance, BEIS refers to findings from the payment processor BACS that SMEs in the UK are owed £26.3 billion in overdue payments, with over half experiencing issues with late payment. The new legislation comprises one of a series of measures that focus on SMEs, such as the impending appointment of a Small Business Commissioner.
The reporting requirement applies to large companies and large LLPs (regardless of whether they are private, public or quoted), based on the size thresholds in the Companies Act 2006. This captures businesses which exceed at least two of the following criteria on their last two balance sheet dates:
No company is required to report in its first financial year.
For certain qualifying contracts in a reporting period, businesses are required to report on:
The disclosures will have to be reported on a web based service provided by the government on the www.gov.uk website. Businesses will upload their information on this service via a portal and suppliers will be able to search the records. A director will be required to approve the information before it is published.
I’d be interested in any comments or concerns members have regarding these new reporting requirements. email@example.com