The Financial Reporting Council (FRC) today publishes an amended version of the Financial Reporting Standard for Smaller Entities (FRSSE) for use by micro-entities which want to take advantage of new regulations allowing them to prepare simplified financial statements.
Micro-entities are the UK’s smallest companies. They are now able to use the FRSSE when choosing to apply the new micro-entities regime and prepare simplified financial statements with fewer disclosure notes than previously required by the FRSSE. The micro-entities regime was introduced into UK company law in November 2013 following new EU legislation.
Roger Marshall, FRC Board Member and Chair of the Accounting Council, said:
“The FRC has amended the FRSSE to bring it into line with the new regulations. In consequence, micro-entities that currently prepare their financial statements in accordance with the FRSSE will continue to be able to use the same standard whilst also benefitting from the Government’s simplification of the law. The micro-entities regime will be available to over one and a half million small businesses.”
The amendments to the FRSSE are effective from the same date as the new legislation, financial years ending on or after 30 September 2013 for companies filing their accounts on or after 1 December 2013.
The Small Companies (Micro-Entities’ Accounts) Regulations 2013 (SI 2013/3008) was made in November 2013 and is effective in respect of financial years ending on or after 30 September 2013 for micro-entities filing their accounts or on after 1 December 2013.
A micro-entity is a company which on its balance sheet date does not exceed the limits of two of the three following criteria:
- turnover: £632,000
- balance sheet total: £316,000; and
- average number of employees during the financial year: 10
The amendments to the FRSSE were consulted on in FRED 52 Draft Amendments to the Financial Reporting Standard for Smaller Entities (effective April 2008) – Micro-entities, which was published in December 2013. An impact assessment and feedback statement is also issued today.
Amendments to the FRSSE - Micro-entities
FRSSE: Impact assessment and Feedback statement - April 2014
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