Accounting standard for SMEs poorly constructed

Tax campaigner Richard Murphy launched a stinging attack on draft regulation
on accounting standards for small and medium companies at the 23rd annual UN
meeting of accounting standards experts this week.

Murphy attended the meeting to discuss issues on corporate responsibility and
corporate governance on behalf of the Publish What You Pay charities coalition.

He said the draft, likely to be in force by August 2008, proposes a standard
that is hopelessly inappropriate for most UK small businesses.

‘It assumes the reporting requirements of all companies are the same,
whatever their size. The result is a standard that will be over 200 pages long.

‘Worse, it is not designed for the needs of a small business… simply cut down
version of the standards used by larger companies,’ said Murphy.

In addition, Murphy criticises the standard for being created by a team
dominated by the Big Four, who assume, he says that the normal SME has at least
50 employees.

‘That represents well under 10% of SMEs, showing how absurd the approach is,’
said Murphy.

For more go on Murphy’s review of the meeting, click
here.