MAR M30 –and Provident Societies Act 1965
Mutual Societies Annual Return (AR30) – Notes
For societies registered under the Co-operative and Community Benefit Societies Act 2014
Important information you should read before completing this form
Please take time to read these notes carefully. They will help you to fill in the form correctly.
These notes are for information only. They are not a full statement of legal obligations under the relevant
legislation. The society may wish to seek legal advice on how to comply with the legislation.
If after reading these notes you need more help, please:

check our website for more information on Mutual Societies: www.fca.org.uk/mutuals

email the Mutual Societies Team at mutual.societies@fca.org.uk

write to us at: Financial Conduct Authority, 25 The North Colonnade, Canary Wharf, London, E14
5HS; or

call the Contact Centre on 0845 606 9966
If a society wishes to amend its rules, you can find more information and the forms at www.fca.org.uk/mutuals
Terms in this form
'FCA', ‘PRA’, 'us' and 'we' refer to the Financial Conduct Authority or Prudential Regulation Authority.
'You' refers to the person signing the form on behalf of the society.
‘The 2014 Act’ is the Co-operative and Community Benefit Societies Act 2014
Preparing and submitting the return
Preparing and submitting the return
Preparing and submitting the return is the responsibility of the society's Secretary. We
are not able to offer guidance beyond that contained in this document, or to interpret the
law or the rules of any society. If you need advice on anything that is not in these notes,
or you need help interpreting what you read here, it may help to speak to an independent
adviser. For example, you could speak to a trade or professional body, a solicitor or
qualified accountant.
The date you submit your return depends on the date of the society's financial year end.
You must submit your return within seven months of that date.
The annual return is made up of two parts:

Part 1 is the annual return form - AR30.

Part 2 should be a set of accounts (see page 9 for information).
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The legislation and annual fees
The legislation and annual fees
Co-operative and Community Benefit Societies Act 2014
Part 7 of the 2014 Act sets out the requirements for accounts, audits and annual returns.
In particular:

Section 79 requires societies to prepare accounts

Section 83 requires societies to appoint auditors

Section 84 gives societies the power to disapply the audit requirement

Section 85 sets out the circumstances when an accountants report is needed

Section 89 requires a society to submit its annual return and accounts within 7
months of the end of its financial year

Section 98 makes provision for group accounts; and section 99 the exceptions
from group account requirements

Sections 143 and 144 enable us to direct the form to be used
Annual Fees
You are not required to submit a filing fee with your annual return.
The only payment you will be required to make is your periodic fee to the FCA.
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2 Statistics
1
Details of society
Details of the society
1.1 Details of the society
You must give the full registered name. Please do not use abbreviations.
1.2 Year end date (dd/mm/yyyy)
Please provide the date your financial year ended on.
If you would like to change the society’s financial year end date, you will need to notify us
on our “Change of Year of Account” form, found at www.fca.org.uk/mutuals.
Committee of Management
1.3 Details of Chairman
You must give the full names, please do not use abbreviations.
1.4 Details of Treasurer
You must give the full names, please do not use abbreviations.
1.5 Details of Secretary
You must give the full names, please do not use abbreviations. All societies must have a
secretary.
1.6 Details of Members of the Committee
You must give the full names, please do not use abbreviations.
You are not required to enter the business occupation and other directorships if the
directorships are of a parent or subsidiary organisation(s).
1.7 Are any members of the society’s committee disqualified as directors under the
Company Director Disqualification Act 1986?
No person who has been disqualified as a director (including ‘committee members’) who
is subject to a disqualification order under the Company Director Disqualification Act
1986 can serve as a director of a registered society. Please answer this question to
confirm whether or not any of the society’s directors are disqualified under that Act.
1.8
Does the society carry out any regulated activity under the Financial Services and
Markets Act 2000?
A person wanting to carry out any activity regulated under the Financial Services and
Markets Act 2000 must seek authorisation to do so. More information can be found on
our website at www.fca.org.uk.
Examples of regulated activities include: deposit taking, offering insurance products,
undertaking residential mortgage business.
Please note – accepting deposits in the form of withdrawable share capital does not
constitute a ‘regulated activity’.
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1.9
Is the society a subsidiary of another society?
For the meaning of being a ‘subsidiary’ of another society see section 101 of the 2014
Act.
1.10
Does the society have one or more subsidiaries?
For the definition of subsidiary see sections 100 and 101 of the 2014 Act.
1.11
Is the society currently accepted by the HM Revenue and Customs as a charity for
tax purposes?
Please confirm whether the society has been accepted by HM Revenue and Customs as
a charity for tax purposes. If so, please also provide a copy of the letter from HM
Revenue and Customers.
Please note, here we are asking only in relation to charitable tax status, not in relation to
mutual trading status.
1.12
Is this society a charity registered with the Office of the Scottish Charity Regulator
(OSCR)?
This applies to societies registered in Scotland with the Office of the Scottish Charity
Regulator. If the society is registered with OSCR please provide its Scottish Charity
number.
A charitable society in England and Wales cannot register with the Charity Commission.
1.13
Is the society registered with one of the following (please tick)?
Please tell us if you are registered with either: the Homes and Communities Agency,
Scottish Housing Regulator, or the Welsh Ministers. If so, please provide us with your
register number.
If the society is a bona fide co-operative, go to question 1.14.
If the society exists for the benefit of the community go to question 1.19.
Bona fide co-operative
1.14
How did members benefit from the business, industry or trade of the society?
All societies must be carrying out a business industry or trade. As a co-operative the
society should exist to benefit its members. Please describe how members benefitted
from the society’s business, industry or trade.
1.15
Is membership of the society required to obtain the benefits offered by it?
Please indicate whether the benefits the society offers are only available to members.
1.16
In what way did members participate in an ongoing basis in the society’s primary
business?
For example, did they have a trading relationship with the society, or are they its
employees? We would expect the information provided here to be the reason members
joined the society.
1.17
How did members democratically control the society?
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2 Statistics
We expect to see democratic member control of the society. Please explain how this was
exercised throughout the year.
1.18
How did the society use any surplus/profit?
If the society distributed the surplus/profit to members please explain how this was done.
Benefit of the community
1.20 Who are the community the society benefited?
Please state who the community of benefit is. For instance, if you serve a local
geographical community please refer to that.
This can be a single community, communities or groups of people the society will benefit. This
also includes communities or corporations from abroad.
1.21 How did the society benefit that community?
Please state how the society will benefit the community described above.
1.22 How did the society use any surplus/profit?
Please state how the society used any surplus/profit. We expect any surplus or profit to
be used for the benefit of the community.
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2 Statistics
2
Statistics
We can use these figures in our Annual Report.
Account details
2.1 You must enter the figures below
Please note we will use the information you give in boxes E,F and J to determine if a
society may take advantage of the option to not undertake a full professional audit for the
next accounting year.
A Members at beginning of year
No extra guidance
B Members ceased during year
No extra guidance
C Members admitted during year
No extra guidance
D Members at end of year
No extra guidance
E Turnover for year
For most societies this will be the total derived from the provision of goods and services
after deducting:

trade discounts;

V.A.T; and

any other taxes.
These amounts will be shown in the society's revenue account (which may in some
societies be described as the Income and Expenditure Account) and should be added
together.
If the society is charitable, you should use the figure denoted in the accounts as 'gross
income' instead of ‘turnover’.
F Total of income and expenditure (receipts and payments added together)
This will be the sum of the turnover and total expenditure for the year. We use this entry
to determine whether the society is permitted to employ lay auditors in accordance with
the 2014 Act. So you only need to complete it if the society anticipates appointing lay
auditors in the next accounting year.
G Net surplus/(deficit) for year
This will be either:

the surplus of income over expenditure; or

the excess of expenditure over income.
It should be the surplus before dealing with any taxation or extraordinary items. The net
surplus for the year will be shown in the society's revenue account as a separate amount
and you should enter it in Box G. If there was a surplus you should delete the word
‘deficit’.
If the society has shown a deficit for the year – where there has been an excess of
expenditure over income (before dealing with any taxation or extraordinary items) – this
will be shown in the society's revenue account as a separate amount and you should
enter it in brackets in Box G. In these circumstances you should delete the word
‘surplus’.
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H Fixed assets
For most societies this covers land and buildings, plant, fixtures and fittings and
investments and will be shown in the society's balance sheet. Enter the total of the
amounts shown in the balance sheet at the end of the year (that is after items bought
forward, additions, revaluations, transfers, disposals and depreciation etc).
I
Current assets
For most societies this covers stock, cash at bank and in hand, trade debtors and
investments held in the short term, and will be shown in the society's balance sheet.
Enter the total of the amounts shown in the balance sheet at the end of the year as one
amount.
J Total assets (equal to amount in below O)
This is the sum of the amounts of fixed and current assets shown in Boxes H and I. This
should also equal the amount shown in Box O (total liabilities).
K Current liabilities
This will be shown as a separate item representing amounts falling due within one year.
For many societies this covers bank overdraft, amount owing to parent or subsidiary
organisations, dividend stamps, share interest, short-term loans (falling within one year)
and taxation. Some liabilities such as finance leases, hire purchases and bank loan
creditors will need to be split between current liabilities and long-term liabilities. Share
capital may also be included under this heading and/or the heading of long-term liabilities
where this falls outside the remit of Financial Reporting Standard (FRS) 25, or for those
organisations complying with international accounting standards, IAS 32, see notes
below under long-term liabilities.
L Share capital
This will be shown as a separate item in the society's balance sheet representing the
issued share capital. Amounts included under this item should comply with the
requirements of FRS 25, or for those organisations complying with international
accounting standards, IAS 32.
M Long-term liabilities
This will be shown separately in the society's balance sheet representing amounts falling
due after more than one year. Enter the total of the amounts shown in the balance sheet
at the end of the year as one amount. Do not include under this heading any bank
overdraft falling due for repayment within one year. You should include this in current
liabilities (see note K above). Share capital may also be included under this heading
and/or the heading of current liabilities where this falls outside the requirements of FRS
25, or for those organisations complying with international accounting standards, IAS 32
(see note K).
N Reserves
This will be shown separately in the society's balance sheet and covers all reserve
accounts including the accumulated fund carried forward and represents the internally
generated funds of the society.
O Total Liabilities, share capital & reserves
This is the sum of the amounts of current liabilities, share capital, long-term liabilities and
reserves shown in Boxes K, L, M and N – enter this total in Box O. This amount should
also equal the amount shown in Box J (Total Assets).
P Investments in other registered societies
This sum will be shown separately in the balance sheet, or if not, in the notes to the
accounts. This would be part of the total assets.
Q Loans from members
This sum will be found in the balance sheet and is the sum of the Members’ loans under
long-term liabilities and current liabilities. If they are not individually itemised then they
should be included in the notes to the accounts.
R Loans from Employees' Superannuation Schemes
This will be shown separately in the society's balance sheet, and will be the total of the
figures shown against the relevant heading in current liabilities and long-term liabilities.
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2 Statistics
S Dividends on sales
This will be shown as a separate item in the revenue account.
T Share Interest
This will be shown as a separate item in the revenue account.
2.2 Names of subsidiaries as defined in sections 100 and 101 of the Co-operative and
Community Benefit Societies Act 2014
No extra guidance
2.3 Names of subsidiaries not dealt with in group accounts (if any) and reasons for
exclusions (as approved by the FCA)
For an explanation of group accounts and exclusion of subsidiaries from such accounts,
see 'Group accounts' in question 4.2.
Paragraphs 25 and 26 of the FRS No 2 do not apply.
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3 The audit
3
The audit
3.1 Type of audit used for the attached accounts.
See the section headed 'the Audit' under 4.2.
3.2 Do the society's registered rules allow the society not to undertake a full
professional audit?
A rule change may be necessary in addition to a resolution under section 84 of the 2014
Act, in order to dispense with a full professional audit.
3.3 Has the membership passed at a general meeting a resolution allowing the society
not to undertake a full professional audit for the year of account in question? (In
accordance with section 84 of the Co-operative and Community Benefit Societies Act
2014)
Paragraphs 25 and 26 of Financial Reporting Standard No 2 do not apply.
The term “qualified auditor” refers to a person eligible for appointment as a statutory
auditor under Part 42 of the Companies Act 2006. A statutory auditor is required to be a
member of a recognised supervisory body (which includes the Institute of Chartered
Accountants in England and Wales and the Association of Chartered Certified
Accountants) and eligible for appointment under the rules of that body.
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4 Accounts and signature
4
Accounts and signature
Accounts
4.1 Date on which the accounts and balance sheet will be/were laid before the AGM
The legislation does not require you to wait until after your AGM to submit your return,
although you should ensure that your society's rules also permit you to do this.
4.2 Has your society produced accounts to the minimum standard required?
General principles
Societies must produce accounts at least the minimum required by the legislation and
their own rules. Briefly, that is a revenue account dealing with the affairs of the society
as a whole or two or more revenue accounts covering the whole year which deal
separately with different businesses of the society. These, together with any balance
sheet, shall give a true and fair view. The legislation further provides that a society shall
not publish any revenue account or balance sheet unless it has been audited and
incorporates a report by the auditor confirming that it gives a true and fair view (if
required by legislation), and it has been signed by the secretary and two members of the
committee of the society acting on behalf of the society. However, a society may publish
an unaudited interim revenue account or balance sheet provided it is published with the
latest audited year end revenue account or balance sheet and it is marked in clearly
legible characters and in a prominent position with the words “UNAUDITED REVENUE
ACCOUNT” or, as the case may be, “UNAUDITED BALALNCE SHEET”. Please see
page 3 for references to the legislation covering these points and pages 10-12 below for
further information about the requirements for an audit.
The principles set out in Financial Reporting Standards published by the Accounting
Standards Board are generally relevant (but see also 'Group Accounts' below). Some
societies are affiliated to sponsoring bodies or are regulated by other organisations
which may issue accounting requirements more rigorous than those described above.
These should be complied with provided there is no conflict with or shortfall from the
provisions of the 2014 Act.
Group Accounts
Societies which have one or more subsidiaries must produce group accounts in addition
to the accounts or supplementary return for the society alone, unless exemption has
been granted by the FCA or the society is itself a wholly owned subsidiary of another
society (see next paragraph). The group information (for the society and its subsidiaries)
can be presented alongside the society figures in one set of accounts or separately in a
third booklet.
The legislation governing registered societies allows a society to apply to the FCA for an
exemption from the inclusion of one or more subsidiaries in group accounts. The
exclusion of a subsidiary would usually be on the grounds of immateriality or the fact the
businesses of the parent society and subsidiary differ so greatly that they could not be
treated as a single entity. If approval is given, it will continue indefinitely provided the
grounds for the reason given in the application remain. However a society's auditor will
be required to include a certificate in his report each year to the effect that he/she agrees
with the committee of the society that the grounds given in the original application
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4 Accounts and signature
continued to apply throughout the year of account. If such a certificate is included, no
further application for exemption need be made.
A society which itself is a wholly owned subsidiary of another society is automatically
exempted by legislation from the obligation to produce group accounts, even if it has
subsidiaries itself.
The Accounting Standards Board has published the Financial Reporting Standard
Number 2 (FRS2) Accounting for Subsidiary Undertakings. Paragraphs 25 and 26 refer
to the exclusion of subsidiary undertakings from the consolidated financial statement.
Please note that these paragraphs in FRS2 do not override the provisions of 2014 Act.
Indeed, paragraphs 19 and 61 of FRS 2 state that the FRS requirements should be
complied with except where these requirements are not permitted by any statutory
framework under which such undertakings report.
If a society which is required to submit group accounts excludes such information from
its Annual Return, the documents will be returned to the society to be completed fully.
The Audit
If a full audit is carried out or an accountants report is produced, registered auditors must
be appointed to carry out the work (someone who is eligible for appointment as a
statutory auditor under Part 42 of the Companies Act 2006). The type of audit depends
on a number of factors:

financial thresholds, namely:
o
the turnover of the society in the preceding year of account, and
o
the total assets in the preceding year of account;

whether the society is required by law to have a full professional audit;

the current rules of the society; and

assent by the membership in general meeting.
Please note that in all instances, all published accounts, whether audited or not, must be
signed by the secretary and two committee members of the society on behalf of the
society's committee.
The options and the eligibility criteria
i) Societies which require a full professional audit by a qualified auditor
A full professional audit by a qualified auditor is always required by societies
which in the preceding year of account had a turnover in excess of £5,600,000
(£250,000 if charitable) or total assets in excess of £2,800,000.
Any society, irrespective of its level of turnover or assets, which falls under any
of the following categories must also undertake a full professional audit:

Housing Associations registered with the Homes and Communities
Agency, the Welsh Ministers or Scottish Housing Regulator (see note
* below);

a subsidiary of another society;

a society with one or more subsidiaries (whether those subsidiaries
are companies or societies);

a society that must prepare accounts under the Insurance Accounts
Directive (Miscellaneous Insurance Undertakings) Regulations 1993;
and

a society which takes deposits, or has taken in the past and continues
to hold deposits, within the provisions of the Financial Services and
Markets Act 2000 (unless note ** below applies), other than a deposit
in the form of withdrawable share capital.
*Note – Housing Associations which are Registered Social Landlords may
submit an accountant's report instead of a full audit in accordance with
schedule 11 to the Housing Act 2004 if the relevant thresholds are met, but are
not eligible to produce unaudited accounts or a lay audit.
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**Note – these societies are not excluded from appointing Lay Auditors if the
relevant thresholds are met, but are not eligible to produce an accountant's
report or unaudited accounts.
Any society falling into one of these five categories is required by law to have a
full professional audit notwithstanding its level of turnover or assets.
ii) Societies eligible to substitute an accountant's report for a full
professional audit.
Societies are eligible to substitute an accountant's report for a full professional
audit only if all of the following criteria are met:

the society's rules allow it to disapply the requirement to undertake a
full audit. If the rules only permit the society to conduct a full
professional audit, then the appropriate rule amendments must first be
registered with the FCA;

the society's membership has passed at a general meeting a
resolution allowing the society to disapply the requirement to
undertake a full professional audit for the year of account in question;

in the preceding year of account its turnover exceeded £90,000 but did
not exceed £5,600,000 (£250,000 if charitable) and its total assets
were below £2,800,000; and

it is not a society falling under any of the five categories listed in i)
above which are required by law to have a full professional audit.
Less onerous than a full audit, the accountant's report must state whether, in
the opinion of the qualified auditor making the report:

the revenue account or accounts, the other accounts (if any) to which
the report relates, and the balance sheet are in agreement with the
books of account kept by the society;

on the basis of the information contained in the books of account, the
revenue account etc. comply with the requirements of the 2014 Ac;
and

the financial criteria allowing the production of a report instead of a full
audit have been met.
iii) Societies eligible to forward unaudited accounts
A society may produce unaudited accounts only if all of the following criteria are
met:

the society's rules allow it to disapply the requirement to undertake a
full professional audit. If the rules only permit the society to conduct a
full professional audit, then the appropriate rule amendments must first
be registered with the FCA; and

the society's membership has passed at a general meeting a
resolution allowing the society to disapply the requirement to
undertake a full professional audit for the year of account in question;
and

in the preceding year of account its turnover did not exceed £90,000
and its total assets are below £2,800,000; and

it is not a society falling into any of the five categories listed in i) above,
which are required by law to have a full professional audit.
Where the relevant conditions are met, and the society produces unaudited
accounts, the revenue account(s) and balance sheet must still be signed by the
secretary and two committee members of the society acting on behalf of the
society's committee.
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4 Accounts and signature
iv) Societies eligible to substitute a lay audit for a professional audit by a
qualified auditor.
A society may appoint two or more lay auditors in place of a qualified auditor
only if all of the following criteria are met:

the society's rules allow it to disapply the requirement to undertake a
full professional audit. If the rules only permit the society to conduct a
full professional audit, then the appropriate rule amendments must first
be registered with the FCA;

the society's membership has passed at a general meeting a
resolution allowing the society to disapply the requirement to
undertake a full professional audit for the year of account in question;

the total of the society's receipts and payment (income and
expenditure) in the preceding year of account was below £5,000 and
the total number of members at that year end was below 500 and the
total assets did not exceed £5,000. This is the total of the society's
receipts added to the payments figure; and

it is not a society falling into any of the five categories listed in i) above,
which are required by law to have a full professional audit (but see
**note above concerning societies that hold or take deposits within the
provisions of the Financial Services and Markets Act 2000 which can
appoint lay auditors if all the relevant thresholds are met).
A lay audit is an audit by two or more lay auditors. A person may be a lay
auditor if he/she is not an officer or servant of a society and is not a partner
of or in the employment of, or does not employ, an officer or servant of the
society. A society might use lay auditors if it wishes people other than its
committee to check the accounts against its books.
In all instances, a society will be required to prepare fully audited accounts
if the society receives notice from the FCA requiring it to do so.
Society's Rules concerning the Appointment of Auditors
As already emphasised, if the society wishes to take advantage of the option not to
undertake a full professional audit, it may need to amend its rules if they require the
appointment of a qualified auditor and/or the requirement to conduct a full audit.
Members' Assent in General Meeting
If your society wishes to take advantage of the option to disapply the requirement to
have a full professional audit, the power is exercisable by resolution passed at a
general meeting in which:

less than 20% of the total votes cast are cast against the resolution; and

less than 10% of the members of the society for the time being entitled
under the society's rules to vote cast their votes against the resolution.
If the vote is not carried, the society must have a full professional audit.
It should be noted that the assent of the membership is for one year of account only.
A vote must be held in each year of account that a society wishes to disapply the full
audit requirement.
Signature – all societies to complete
4.3 The Secretary of the society must sign and date below
We require all signatures on the form to be original signatures.
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