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Small Company Limits
A small company is entitled to deliver abbreviated accounts to Companies House and also has various accounts disclosure exemptions under the CA 1985 and also under the FRSSE (Financial Reporting Standard for Smaller Enterprises).
In order to qualify as a small company two of the following:
· Turnover < £5,600,000
· Balance sheet total < £2,800,000
· Number of employees < 50
Balance sheet total equals fixed and current assets totals.
Small Company Limits (Audit Limits)
A company is exempt from the requirement to have an audit if its turnover is less than £5,600,000 and its balance sheet total is less than £1,400,000. Small charitable companies with gross income less than £250,000 do not require an audit, although an independent accountants report is required if the gross income of the charity exceeds £90,000 but is less than £250,000.
Friendly & Industrial and Provident Societies previously required an audit if their turnover exceeded £350,000 but this has recently been revised by Statutory Instrument SI 2006/265 effective for financial periods ending on or after 6th June, 2006 which increases the turnover threshold to £5,600,000 in order to align it with other small entities. The balance sheet total is also increased from £1,400,000 to £2,800,000.
Medium Size Companies (Filing Requirements)
A medium sized company is entitled to deliver abbreviated accounts to Companies House which are almost identical to full accounts apart from the fact that the Profit & Loss account need not disclose turnover and cost of sales but may combine these in one category as gross margin.
In addition the particulars of turnover need not be given. In order to qualify as a medium sized small company two of the following three limits must apply :
· Turnover < £11,200,000
· Balance sheet total < £5,600,000
· Number of employees < 250
Balance sheet total equals fixed and current assets totals.
© 2009 Milne Craig Chartered Accountants
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