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New Rules for Small Companies

March 2017

Small (and medium sized) companies were only able to file an abbreviated version of their accounts for accounting periods ending before 31 December 2016. As this date has now passed, all companies must either prepare full accounts or take advantage of exemptions in the new regime available for small companies (The Companies, Partnerships and Groups (Accounts and Reports) Regulations 2015).

The most significant of these new exemptions is the ability for small companies to file abridged accounts. Abridged accounts are simplified accounts with a balance sheet containing a subset of the information that is included in a full balance sheet and likewise an abridged profit and loss account. The decision to abridge all or part of the accounts must be agreed by all the members. Consent must be obtained each year and can only be made in respect of the preceding financial year.

In order to assist our customers, we have therefore updated our Guidance Note: Account & Audit and have produced a package of new templates in relation to the shareholder consent procedure required. This includes:

  • a letter that may be sent to members requesting their consent;
  • a form of pro-forma members reply;
  • confirmation notice to members;
  • a cover letter to Companies House; and
  • a form of consent notice.

This new package will be of interest to all directors, company administrators and their advisors, particularly accountants.

The contents of this Newsletter are for reference purposes only and do not constitute legal advice. Independent legal advice should be sought in relation to any specific legal matter.

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