TT254: New Small Company Filing Requirements
For small companies previously able to file abbreviated accounts with the Registrar of Companies, this option is no longer available for accounting periods beginning on or after 1 January 2016, as FRS 102 compliant accounts must be prepared. There will still be certain options available to them with regard to being able to file abridged or filleted accounts as appropriate with The Registrar of Companies in order to disclose less information than in the full accounts that are prepared for shareholders.
These apply to small companies that meet the revised size and eligibility criteria, which require at least two out of three of the following:-
- Turnover not more than £10.2m (up from £6.5m).
- Balance Sheet total not more than £5.1m (up from £3.26m)
- Average number of employees not more than 50 (as previously)
The production of abridged accounts requires the unanimous approval of the shareholders each and every year (a majority decision is not sufficient) and these must be presented to the members as the full accounts, whereas filleted accounts just represent a filing exemption. The requirements of lenders such as the bank, and of HMRC must be taken into consideration. The production of abridged accounts will not be of any benefit in most circumstances. Before deciding upon any course of action in this area, you should speak with your BR contact partner.
The basic requirements for each set of accounts are set out below :-
- The Profit and Loss Account (Statement of Comprehensive Income) starts at the gross profit or loss and not at the turnover figure.
- There are a reduced number of notes from the full accounts.
- The Profit and Loss Account (Statement of Comprehensive Income) is excluded as are the related notes.
- The Balance Sheet and related notes are included.