Government aims to ease reporting burden for micro businesses

MILLIONS OF SMALL UK businesses could benefit from simplified reporting requirements under government plans.

The Department for Business and Financial Reporting Council have launched a discussion paper, Simpler Reporting for Smaller Businesses, which sets out plans to ease the reporting requirements for as many as five million micro-entities.

The businesses would only 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.

An integrated software package could be developed commercially to help them prepare financial information, in turn helping the micro-businesses better plan and prepare.

“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,” said Ed Davey (pictured), the minister responsible for corporate governance.

“A new deregulation from EU rules targeted at micro-businesses means we now have a chance to deliver these benefits. The financial reporting regime must also serve the users of the information published by companies, whether they are customers, banks or government agencies. So we look forward to receiving responses to our proposals from a broad range of interested parties in the coming months”.

Responses to the discussion can be made until 30 October 2011. Click here to access the paper.