Accounting Procedures (Hansard, 6 June 1995)

§ Mr. Jonathan Evans

As part of the deregulation initiative we have looked hard at the accounting requirements in the Companies Act 1985. We have been helped by all the suggestions that we have received from business and others about areas where compliance is particularly difficult or expensive.

We published a consultative document on 31 May seeking views on what needs to be changed. The document contains: 50 proposals for simplification of specific Companies Act accounting disclosure requirements. A proposal to increase by up to 50 per cent. the financial ceilings which govern whether companies are small or medium-sized for accounting purposes. An invitation to contribute views on the level of accounting disclosure required for small companies. In particular:

(i) could the amount of information in small companies' accounts be reduced further while still satisfying the needs of users?
(ii) should shareholders in certain companies be allowed to opt out of receiving copies of statutory accounts?
(iii) should the level of detail in published accounts (the ones sent to Companies House) be changed?
(iv) should accounts have to be published?
(v) should there be further concessions for accounts of dormant companies?
(vi) is the volume of accounting concessions confusing?
(vii) should there be a standard format in which to give accounting information to Companies House and the Inland Revenue?
(viii) what should such a standard format be?
(ix) comments on the costs of preparing statutory accounts and on any potential cost savings;
(x) any other suggestions for reform.

This consultation provides an opportunity to influence the Government's thinking on how best to minimise the burden of accounting disclosure on companies, while at the same time ensuring that the information provided meets the reasonable needs of users of accounts, such as shareholders, banks, the Inland Revenue, creditors and others dealing with the company.

The consultative document has been placed in the Library of the Houses. Replies are invited by 4 September.