(This note is not part of the Order)

This Order makes provision to give effect to:

Regulation (EC) 1606/2002 of the European Parliament and of the Council on the application of international accounting standards (OJ L 243, 11/09/2002 p.1 - 4) ("the IAS Regulation"), in relation to building societies; and

Parts of Directive 2003/51/EC of the European Parliament and of the Council amending Directives 78/660/EEC, 83/349/EEC, 86/635/EEC and 91/674/EEC as regards modernising the annual and consolidated accounts of certain types of companies, banks and other financial institutions to bring the preparation of those accounts more into line with international accounting standards (OJ L 178, 17/07/2003, p.16 - 22) ("the Modernisation Directive"), in relation to building societies.

The Parts of the Modernisation Directive implemented by this Order, are those which require amendments to be made to the Building Societies Act 1986. The remainder of the directive will be implemented for building societies by amendments to the Building Societies (Accounts and Related Provisions) Regulations 1998.

This Order amends Part 8 of the Building Societies Act 1986 ("the 1986 Act) which deals with accounts and audit. Article 1 applies the provisions of the Order to building society's financial years beginning on or after 1st January 2005.