‘Simpler Reporting for the Smallest Businesses’ – Joint BIS FRC Update
The Department for Business Innovation and Skills and the Financial Reporting Council have jointly published a discussion paper on ‘Simpler Reporting for the Smallest Businesses’.
The paper sets out ideas to reduce the amount of reporting micro-entities would be required to undertake.
A number of open meetings were held to enable interested parties to debate the issues raised by the discussion paper, and 90 written responses were also received. These responses include those from accountants and advisers, and from some small businesses themselves.
BIS and the FRC are grateful for the number and quality of responses, and the breadth of interests represented.
In February 2012, the European Council agreed proposals for a significant simplification of accounts and reporting for micro-entities (now defined as; turnover of less than €700,000, net assets of less than €350,000 and employing no more than 10 people on average). This was a positive conclusion to the negotiations and one which was welcomed by the UK Government.
In principle, the UK Government intends to take advantage of the option now available to Member States under these revised arrangements, and will consult on implementation in due course. The responses received to the discussion paper on Simpler Reporting will now be used to help inform that work.
This will allow Government to consider how, within the current EU framework, the financial reporting regime for the smallest companies can be made less burdensome and more informative.