Last week I attended a financial reporting update at the ICAEW. I understand from the speakers that there was a debate over the title of the proposed standard. The criteria has nothing to do with size but more whether entities are regarded as public interest. It would be feasible for extremely large privately held businesses to be regarded as SMEs under the proposed standard.
Whilst the reduction in administrative burden for smaller/medium businesses is to be applauded I am concerned that there is absolutely no size criteria. An AIM quoted company with 5 employees and a fairly narrow shareholder base would be (in terms of standards) regarded as of greater public interest than a privately held business with 50,000 employees and creditors of hundreds of millions of pounds. In the latter case the livelihoods of hundreds of thousands of people will be dependent upon the financial well being of the "SME" and I do not believe that the bar should be lowered for these companies.
The application of the Standard to UK companies is now being considered and I hope that the ASB take the view that size does matter when it comes to large companies.