Charities Bill [HL]

moved Amendment No. 65:"Page 98, line 8, leave out ““to which”” and insert ““which, by virtue of””" The noble Lord said: I rise to move Amendment No. 65 standing in the name of my noble friend Lady Scotland and to speak to Amendment No. 66 which is grouped with it. Paragraph 1 of new Schedule 5A to the 1993 Act, as inserted by Schedule 6 to the Bill, supplies the meaning of a ““subsidiary undertaking”” for the purposes of the new group accounting provisions. If the requirement to prepare group accounts applies, a parent charity must prepare accounts covering itself and its subsidiaries as a group. The definition of a subsidiary undertaking is important because it determines, for each parent charity, which other entities must be accounted for in the group accounts. Sub-paragraph (4) of paragraph 1 lists entities which are not to fall within the definition of a subsidiary undertaking. One such entity is any institution to which a direction under Section 96(5) of the 1993 Act applies for the purposes of the group accounting provisions. Section 96(5) allows the Charity Commission to determine that an institution established for any special purposes or in connection with a charity shall be treated as either forming part of that charity for accounting purposes or as forming a distinct charity. If the commission has already determined that a particular institution forms a distinct charity for accounting purposes, it does not make sense for the Bill to exclude that institution from the definition of subsidiary undertaking. However, at present the Bill does make such provision. These amendments are designed to correct that, and I am greatly indebted to the Association of Charity Independent Examiners for bringing this matter to our attention and enabling us to make that correction. On Question, amendment agreed to.