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August 24, 2011

UK small companies to see reduced reporting requirements

The UK government and the Financial Reporting Council (FRC) are considering reducing financial reporting burdens for small businesses.

The discussion paper published by the department for Business, Innovation and Skills and the regulator proposes easing corporate reporting procedures for micro-entities with annual turnover of less than £440,000 ($724,152), net assets under £220,000 and with less the 10 employees.

These small businesses would be required to file a simplified trading statement, in place of the current profit and loss account, a simplified statement of position and a simplified annual return.

The paper also proposes developing an integrated software package to help small businesses prepare financial information and allow managers to gain a better understanding of the trends in their businesses’ performance.

“Reducing unnecessary regulatory burdens on the smallest businesses can give them the freedom to innovate and grow. A new deregulation from EU rules targeted at micro businesses means we now have a chance to deliver these benefits,” Minister for employment relations, consumer and postal affairs Edward Davey said.

The discussion paper is open for comment until 30 October 2011.

 

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