The powers of the Panel derive from the Companies Act 2006 and the Companies (Audit, Investigations and Community Enterprise) Act 2004.
The Companies Act 2006 provides for the Secretary of State to enquire into the accounts of companies (s455) and, where necessary, to apply for a court order requiring their revision (s456). The Secretary of State has the power to authorise others to apply to the Court (s457). The Panel was given this authority by The Companies (Defective Accounts and Directors' Reports) (Authorised Person) and Supervision of Accounts and Reports (Prescribed Body) Order (S.I. 2008 No. 623) . Pursuant to its Operating Procedures the Panel handles cases involving public and large private companies. All other cases fall to the Department of Business, Enterprise and Regulatory Reform (BERR).
The Companies (Audit, Investigations and Community Enterprise) Act 2004 enables the Secretary of State to make an order appointing a body (a) to keep under review periodic accounts and reports that are produced by issuers of listed securities and are required to comply with any accounting requirements imposed by listing rules and, (b) if the prescribed body thinks fit, informing the Financial Services Authority of any conclusions reached by the body in relation to any such accounts or report. The Panel was so appointed by the above statutory instrument (S.I. 2008 No. 623).
The Companies Act 2006 (s459) empowers persons authorised to apply to court under s456 to require documents, information and explanations to be produced by a company, or any officer, employee or auditor of the company where it appears to the authorised person that there is, or may be, a question whether the annual accounts of a company comply with the requirements of the Act. This power is vested in the Panel pursuant to its authorisation under s457 and extended to reviews under The Companies (Audit, Investigations and Community Enterprise) Act 2004 by s15 of that Act.
From 1st April 2006 the Panel’s powers extended to directors’ reports.
