UK: England and Wales: BAE's accounting records

A copy of the judgment R v BAE Systems Plc [2010] EW Misc 16 (CC) has been published on BAILII: see here. This is the decision of Mr Justice Bean, sitting at the Crown Court in Southwark, in which BAE was fined £ 500,000 (and ordered to pay £ 225,000 towards the prosecution's costs) in respect of its breach of Section 221 ("Companies to keep accounting records") of the Companies Act (1985) (see now Section 386 of the Companies Act (2006)).  Section 221(2) provides that "accounting records shall be sufficient to show and explain the company's transactions". The trial judge sentenced BAE on the basis that (at para. [15]):

... by describing the payments in their accounting records as being for the provision of “technical services” the Defendants [BAE] were concealing from the auditors and ultimately the public the fact that they were making payments to Mr Vithlani, 97% of them via two offshore companies, with the intention that he should have free rein to make such payments to such people as he thought fit in order to secure the Radar Contract for the defendants, but that the defendants did not want to know the details".

UK: boards and risk management - speech by FRC chief executive

In a speech delivered earlier this month (see here, pdf), the chief executive of the Financial Reporting Council, Stephen Haddrill, explained why the FRC had decided to defer its updating of the Turnbull Guidance on Internal Control: in order to meet with directors, investors and others to explore how companies are responding to the new UK Corporate Governance Code provision on the board's responsibilities for risk.

UK: the future of narrative reporting - BIS summary of consultation responses

Earlier this year the Department for Business, Innovation and Skills published a consultation paper on the future of narrative reporting (see here, pdf). The consultation closed earlier this week and a summary of responses was published yesterday: see here (pdf). The Government has stated that it will publish policy proposals, as part of its broader review of corporate governance, after the closure of its consultation A Long-Term Focus for Corporate Britain (14 Jan 2011) but by the date of the next Budget (scheduled for 23 March 2011).

UK: company law reform - what next?

Following the publication yesterday (see here) of the results of an evaluation of the Companies Act (2006) carried out on behalf of the Department for Business, Innovation and Skills, the Government has outlined its future priorities with regard to company law. These include proposals to modernise and simplify the current system for the registration of company charges (details of which have already been published: see here), as well as a review of whether a new corporate form for single person businesses would reduce costs for entrepreneurs. For further information see here.

UK: BAA Corporate Governance SIG meeting - papers available

Last week the British Accounting Association Corporate Governance Special Interest Group, in association with the Loughborough University Corporate Governance Centre, held a meeting titled Governing the Crisis: Creation and Resolution. Copies of some of the papers presented are available here. Included is a very useful survey of the corporate governance literature of the last decade, with a particular emphasis on British and European literature.