iXBRL Accounts Tagging Services for
WHAT ARE SMALL COMPANIES?
A small company to qualify as a small company must meet at least two of the following conditions:
- annual turnover of £10.20 million or less
- the balance sheet total must not exceed £5.10 million
- 50 employees or less
A small company can prepare and submit accounts according to special provisions in the Companies Act 2006 and the relevant regulations. This means that they can choose to disclose less information than medium-sized and large companies.
NON-ELIGIBLE SMALL COMPANIES
A company cannot prepare and submit small company accounts if it is, or was at any time during the financial year, one of the following;
- a public company
- a member of an ineligible group (see below)
- an authorised insurance company, a banking company, an e-money issuer, a MiFID (e. Markets in Financial Instruments Directive) investment firm or a UCITS (i.e. Undertakings for Collective Investment in Transferable Securities) management company or carried on insurance market activity
ACCOUNTING STANDARD FOR PREPARATION OF ACCOUNTS OF A SMALL COMPANY
With effect on or after 1 January 2016 small businesses is not permitted to prepare their accounts in accordance with the FRSSE. Instead such companies need to transition to one of the New UK GAAP alternatives. It’s expected that for many entities currently applying FRSSE they’ll transition to FRS 105, or section 1A of FRS 102.
Entities preparing their accounts using section 1A of FRS 102 will only have to present a balance sheet, profit and loss account and limited notes.
They will also have the option of presenting an abridged balance sheet and profit and loss account.
The abridged balance sheet includes the main headings only (intangible assets, tangible assets, investments, stocks, debtors, cash, prepayments, creditors, provisions, accruals, equity, capital, members’ current account, revaluation reserve, other reserves and profit and loss reserve). No further analysis of these headings is required.
The abridged profit and loss account starts with a single figure for ‘gross profit or loss and other operating income’. There is no separate disclosure of turnover, cost of sales and other operating income.
REQUIREMENTS FOR ACCOUNTS PREPARATION & FILING FOR SMALL COMPANIES
Generally, small company accounts include:
- a profit and loss account
- a balance sheet, signed by a director on behalf of the board and the printed name of that director
- notes to the accounts
- group accounts (if a small parent company chooses to prepare them)
And they should be accompanied by:
- a directors’ report that shows the signature of a secretary or director and their printed name
- an auditor’s report that includes the printed name of the registered auditor
If your company is small, you can:
- use the exemption so your company’s accounts do not need to be audited
- choose whether or not to send a copy of the director’s report and profit and loss account to Companies House
- send abridged accounts to Companies House