Micro-reporting exemption starts next month

From the end of September, companies with fewer than 10 employees turning over less than £632,000 will be able to submit an abridged balance sheet and profit and loss account to Companies House for their annual accounts.

The announcement from the Department of Business, Innovation and Science follows a consultation exercise on proposals to reduce reporting requirements for "micro entities" that were first raised in European accounting directive revisions proposed more than two years ago.

Companies will, however, have to continue preparing traditional profit and loss accounts to comply with HMRC's requirement to submit GAAP-compliant accounts with their corporation tax returns.

In its response to the consultation document on UK implementation, the BIS indicated that it plans to...

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Comments

Pointless waste of time    5 thanks

Mouse007 | | Permalink

"Companies will, however, have to continue preparing traditional profit and loss accounts to comply with HMRC's requirement"

 

Another pointless waste of time then.

Profit & Loss Account    5 thanks

jpcentral | | Permalink

Surely companies with a turnover less than £632,000 don't have to submit a P&L to Companies House now and they already submit an abbreviated balance sheet. So, what's the improvement?

Locutus's picture

Bizarre    1 thanks

Locutus | | Permalink

The whole thing is bizarre. So micro companies now have a wonderful new filing option that discloses even more financial information (i.e. the P&L) than their much larger "small" counterparts.

The only micro companies that will use it will be companies that file their own accounts without the help of an accountant and don't realise there is another option of not having to file a P&L.

What a waste of time and money for BIS consulting on this nonsense.

DMGbus's picture

Please clarify "Profit and Loss Account"    2 thanks

DMGbus | | Permalink

The article above says:

 

" From the end of September, companies with fewer than 10 employees turning over less than £632,000 will be able to submit an abridged balance sheet and profit and loss account to Companies House for their annual accounts. "

 

How can this be better?

This, as pointed out above, is an ADDITIONAL DISCLOSURE

So, the question that I have is this: is the above article INCORRECT?

If the article is CORRECT, then what's the point of the new rules?? Maybe some companies will be required to submit and P&L and others not ?

 

pembo's picture

ICAEWs    3 thanks

pembo | | Permalink

guidance says " Micro-entities would only need to prepare an abridged balance sheet and abridged profit or loss account. The profit or loss account would not need to be filed with Companies House. Where a company has acquired its own shares, has outstanding commitments by way of guarantee of any kind or has advanced loans to directors, these would need to be disclosed. No other note disclosures would be required.

Micros would also be allowed to not recognise accruals or prepayments as long as these relate to ‘charges other than the cost of raw materials and consumables, value adjustments, staff costs and tax’. Apart from this limited exemption, normal accruals accounting would still apply."  

As the exemption applies to the statutory accounts for members in theory it is a deregulation.HMRC would however still want the detailed P&L prepared under GAAP. The obvious question then is whether you'd have 2 P&L accounts if you took advantage of the accruals/prepayments exemption that would prima facie be contrary to GAAP. As ever increases complexity rather than less.

jon_griffey's picture

Ineligible groups    1 thanks

jon_griffey | | Permalink

Some small companies need to file full accounts if they are members of an ineligible group.  For example if the ultimate parent company is listed in the EU.  This measure could therefore save such companies having to file full accounts as the definition of Micro Entities appears to make no reference to ineligible group definitions.  However I can't think that such companies are the intended beneficiaries of this 'deregulation'. 

Crap    2 thanks

deg2yq | | Permalink

Waste of time yet another disaster dressed up as a benefit

What does he actually do    2 thanks

deg2yq | | Permalink

Cable that is what's so cleaver about this?

Morons    2 thanks

The Black Knight | | Permalink

Morons

They really do not have a clue.

I cannot comprehend the levels of stupidity that must have been employed on this task.

Shame you can't vote for no confidence.

 

 

micro companies

POOLWAY | | Permalink

 

Can we assume that small companies may continue to file the Abbreviated Accounts as now?

I would

The Black Knight | | Permalink

POOLWAY wrote:

 

Can we assume that small companies may continue to file the Abbreviated Accounts as now?

I would.

This is an extra level of complication.

Trouble is simplification is an awfully long word and the meaning has not been understood yet.

Once this has been understood (expected delivery mid century) we can then move on to understanding useful.

It is as if the process of simplification is understood as the removal of brains before working on these tasks.

Mouse can you do the pictures?

How we are ever going to get to useful?

Yes

Laurence52 | | Permalink

POOLWAY wrote:

 

Can we assume that small companies may continue to file the Abbreviated Accounts as now?

Note 6 to the announcement says the exemptions are optional. It will be for owners and directors of micro-entities to assess the possible effect of reduced disclosures on their company and to decide which form of financial reporting statement - micro, small or full - best meets their company's needs.

 

It didn't have to be this difficult    1 thanks

adam.arca | | Permalink

Instead of introducing some new accounting rules and making life more difficult, why did they not just keep the existing recognition rules but abolish the unnecessary disclosures? Job done (apart from the fact, as Steve Collings has said, the FRSSE would need amending pronto to get rid of its unnecessary disclosure requirements).

Sensible

The Black Knight | | Permalink

adam.arca wrote:

Instead of introducing some new accounting rules and making life more difficult, why did they not just keep the existing recognition rules but abolish the unnecessary disclosures? Job done (apart from the fact, as Steve Collings has said, the FRSSE would need amending pronto to get rid of its unnecessary disclosure requirements).

That would have been sensible and is not allowed! How else would they waste millions on their excuse for doing a nothing.

Abbreviated accounts are not influenced by the FRSSE !

 

 

Penfold's picture

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Penfold | | Permalink

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BIS Enrolment: Stage one    2 thanks

Mouse007 | | Permalink

Remove brain, spine, ears an eyes.

Result: Another Cable Clone.

(Will that do TBK ?)

 

and i'll have those full stops back, thank you penfold.

BIS announcement

SAservices31 | | Permalink

 

Does BIS stand for - Blimey its stupid ??

Message from George G, currently "indisposed".......

Jane N Smith | | Permalink

Message from George G, currently "indisposed".......

"BK, mind yourself when it comes to making use in the language of the word

"Moron".

It's rude and aggressive, and might lead to you also becoming "indisposed"."

I have no idea what he's going on about.

But a mutual friend of my friend, called Dave, who comes from 'ull, made some weird comment about George G, he said:

"George G bears grudges, and settles scores."

Gawd alone knows what he's banging on about!

Why?    1 thanks

Mouse007 | | Permalink

Is George G currently "indisposed" ?

 

edit, got it (I think)

Why do I miss all the fun?

 

Gordon

The Black Knight | | Permalink

I shall use Gordon in future! (what a great track "gordon is a moron")

I would hate to be accused of terrorism defined as "disagreeing with the government of the day"

Terrorism Act 2000 but now I can't find my copy. Early onset of madness.

I used moron as defined in the oxford English dictionary and stand by it Codd dammit! LOL

ar hum

The Black Knight | | Permalink

Mouse007 wrote:

Is George G currently "indisposed" ?

 

edit, got it (I think)

Why do I miss all the fun?

 

ar hum!

A web!

Free George!

Please can we have George back?

at personal risk can I make a plea for clemency on the grounds it was amusing rather than offensive.

scottish

The Black Knight | | Permalink

SAservices31 wrote:

 

Does BIS stand for - Blimey its stupid ??

no idea I think they are a Scottish Indie pop band.