Academic journal article Manager

UK Government Considers Reducing Financial Reporting Burden for Smallest Businesses

Academic journal article Manager

UK Government Considers Reducing Financial Reporting Burden for Smallest Businesses

Article excerpt

Proposals to simplify the financial and corporate reporting requirements for the smallest businesses are the subject of a Discussion Paper from the UK Department for Business, Innovation and Skills (BIS) and the Financial Reporting Council (FRC).

The Paper,'Simpler Reporting for Smaller Businesses', sets out ideas to reduce the amount of reporting that they would be required to undertake. This could benefit around five million businesses and result in considerable cost savings in relation to the preparation of their accounts.

The paper proposes easing corporate reporting procedures so that qualifying businesses are only 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. This could allow managers to gain a better understanding of the trends in their businesses' performance and help them plan for the future.

Edward Davey, the Minister responsible for Corporate Governance, said: "Reducing unnecessary regulatory burdens on the smallest businesses can give them the freedom to innovate and grow, which ultimately benefits the entire economy and is absolutely central to the Coalition's vision for Britain. …

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