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A conversation with Electract Limited
We asked Electract’s Finance Director Richard Malpas about his experience of using RedSky’s Summit accounting system.
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New reporting legislation? We've got it covered...
Did you know that many UK companies and LLPs will shortly have a duty to report twice a year on their payment practices, policies and performance?
Are you up to speed on the new reporting requirement? If not and you’re a qualifying business, you’ll need to act quickly, because it comes into effect in April this year.
We’ve summed up some of the main points in a handy Q&A format below.
If you’re already using our Summit system you’ll be pleased to know that we’ve already developed a new, fully integrated module that will help you source the data you need to meet the requirements. Every six months, using data that’s already on the system, it will help you produce all the reporting information you need. So do get in
touch and we’ll set the ball rolling. And if you’re not yet a Summit user, we’d love to help make your life easier.
To find out more, contact our CRM Team on 020 3002 8700
In a nutshell…*
What is the new requirement?
Large companies and LLPs in the UK will have a duty to report on their payment practices, policies and performance every six months.
Why has the Government introduced it?
Because late payment creates a massive headache for thousands of businesses every year, causing serious cashflow problems and sometimes even insolvency.
When does the legislation come into effect?
6 April 2017 – it applies to qualifying businesses in financial years beginning on or after that date.
What if my financial year starts in, say, February?
Your first reporting period won’t start until February 2018. It’ll end in July 2018, after which you’ll have 30 days to publish your report.
What size of business does it apply to?
Businesses that exceeded two or all of the following thresholds on the last two balance sheet dates:
- £36 million turnover
- £18 million balance sheet total
- 250 employees
What needs to be reported?
Information about payment practices and performance relating to ‘qualifying contracts’ for each reporting period in the financial year. It includes things like your standard payment terms and what percentage of payments were made within 30 days.
What is a qualifying contract?
It’s a contract that:
- Is between two (or more) businesses
- Has a significant connection with the UK
- Is for goods, services or intangible property
- Is not for financial services
How does a business submit its report?
A web service will be available from April 2017 on the www.gov.uk website.
Will suppliers and other interested parties be able to view the information about my business?
Yes, as soon as you upload it.
What are the penalties for late reporting/non-reporting?
Non-compliance is a criminal offence, punishable by a fine.
If you would like more information on RedSky IT and their product options please click here or telephone +44 (0)20 3002 8700.
*This Q&A is our interpretation of the rules surrounding the new reporting requirement. We’ve provided it for information only – it does not constitute legal advice. Further information on this subject can be found at firstname.lastname@example.org