Seán Sherlock (Cork East, Labour) | Oireachtas source

I shall take the two amendments together, if I may. I am unclear as to why the Senator has proposed the deletion of subsections (2) and (6), particularly as the proposal does not include any replacement texts. I can only surmise that he is opposed to the Bill making provision for alternative methods for the storing and managing of accounting records, rather than the requirement to keep accounting records on a continuous and consistent basis. Perhaps he will clarify the matter.

The purpose of subsections (2) and (6) is, respectively, to ensure that accounting records must be kept on a continuous and consistent basis, and that they must be available for inspection in the State. This stems from existing law, specifically section 202 of the 1990 Companies Act. It ought to be noted that the requirement to keep proper books is not an obligation to act as a passive custodian of books, but rather a positive and continuing obligation to create books and records in a particular form and with specified content. The provision has to be general in some respects because technology may change and one cannot be over-prescriptive at the same time.

Subsection (2) in the Bill is cognisant of the fact that ledgers exist in electronic form and, therefore, requires that such ledgers must also be updated and safeguarded from falsification, in a positive manner. It is important that the Bill reflects the realities of the majority of modern company practices. I am not in favour of deleting existing law from this section, on that basis.

The Companies Bill anticipates that where such records are kept, other than book form, safeguards shall be taken to guard against falsification. Subsection (6), subject to the provisions of subsection (7), ensures that where accounting records, other information and returns are kept on a computer that the computer shall be kept in the State. This is another positive duty that recognises that many modern companies no longer rely on ledgers and paper when maintaining or recording any transactions.

I cannot support a proposal to remove references and safeguards relating to technological innovations from this section. This Bill aims to strike a balance between good regulation and the need to ensure that the operating environment for companies in Ireland is informed by the realities of modern companies. Record management is a crucial aspect for modern companies. The rationale behind these provisions is to ensure that the companies availing of modern technologies shall take certain precautions to ensure that said records are accessible and authentic.

With regard to the second point made about records, we could take a look at that on Report Stage. I also take the point that the Senator made in relation to cloud computing which is something we must have due regard for. Perhaps we could come back to it at a later stage in the proceedings, if that is okay with the Senator.