Guide to the new small company accounts filing requirements

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For accounting periods commencing on or after 1 January 2016, small companies (not including micro-entities) no longer have the option of filing abbreviated accounts at Companies House – for periods commencing after that date abbreviated accounts have been abolished.

The filing obligations of small companies are contained in s444 of the Companies Act 2006. This allows companies to file the accounts which they prepared for shareholders (full or abridged) or to take advantage of the exemptions available which allow the profit and loss account and/or directors' report to be excluded from the accounts being filed.

Please note: abridged accounts are not the same as abbreviated accounts. Abridged accounts allow a company to include only certain line items in the abridged profit and loss account and abridged balance sheet and require pre-consent from shareholders. Abbreviated accounts were based on the principle that full accounts were prepared for the members but an abbreviated version of the full accounts was allowed to be prepared and submitted to Companies House.

Section 444 of the Companies Act 2006 applies regardless of the reporting framework that the company has applied i.e. UK Generally Accepted Accounting Practice (GAAP) or International Financial Reporting Standards (IFRS) and whether or not it has prepared abridged accounts.

As noted above a small company can file the same set of accounts that it prepared for its shareholders regardless of the framework applied and regardless of whether these were abridged. Set out below are the options available for a company looking to reduce the amount of information put on to the public record under the following scenarios:

Scenario 1: Small company filing unaudited and unabridged accounts in accordance with s444 of the Companies Act 2006

Key points for filing

  1. The directors of the company must file its balance sheet (the Companies Act definition of “Balance Sheet” includes related notes). In practical terms this means that most notes to the accounts will need to be filed.
  2. The directors of the company do not need to file either its profit and loss account (nor the related notes) or the directors’ report. (They of course also have the options to file either or both).
  3. Where directors of the company do not file the profit and loss account or the directors' report then they must make the following statement in a prominent place on the balance sheet filed:“The company’s annual accounts and reports have been delivered in accordance with the provisions applicable to companies subject to the small companies regime.”
  4. Additionally, in relation to the non-filing of the profit and loss account only, the filed balance sheet must include the following statement: “As permitted by Section 444 of the Companies Act 2006, the directors have not delivered to the Registrar a copy of the company’s profit and loss account for the year ended xxxx.”
  5. The filed balance sheet and the directors’ report (if delivered), must state the name of the person who signed it on behalf of the board of directors.

Please note that where the profit and loss account is delivered, the related notes should also be included in the notes to the accounts.

Scenario 2: Small company filing audited and unabridged accounts in accordance with s444 of the Companies Act 2006

Key points for filing

  1. The directors of the company must file its balance sheet (the Companies Act definition of ‘Balance Sheet’ includes related notes). In practical terms this means that most notes to the accounts will need to be filed.
  2. The directors of the company do not need to file either its profit and loss account (nor the related notes) or the directors’ report. (They of course also have the options to file either or both).
  3. Where the directors choose to file the profit and loss account they must also file a copy of the auditor’s report on the accounts (and any directors’ report) that they deliver.
  4. Where directors of the company do not file its profit and loss account or directors’ report then they must make the following statement in a prominent place on the balance sheet filed: “The company’s annual accounts and reports have been delivered in accordance with the provisions applicable to companies subject to the small companies regime.”
  5. Additionally, in relation to the non-filing of the profit and loss account only:
    • the filed balance sheet must include the following statement:“As permitted by Section 444 of the Companies Act 2006, the directors have not delivered to the Registrar a copy of the company’s profit and loss account for the year ended xxxx.” And
    • the notes to the balance sheet must:
      • State whether the auditor’s report was qualified or unqualified.
      • Where qualified, the basis of the qualification must be disclosed (reproducing any statement under s498(2)(a) or (b) or s498(3), if applicable.
      • Where report was unqualified, include reference to any matters which the auditor drew attention by way of emphasis.
      • State name of auditor and (where the auditor is a firm) the name of the person who signed the auditor’s report as senior statutory auditor, or in the very rare circumstances that s506 (circumstances in which names may be omitted) are met, that a resolution has been passed and notified to the Secretary of State in accordance with that section.
  6. The filed balance sheet and the directors’ report (if delivered), must state the name of the person who signed it on behalf of the board of directors.
  7. Where the auditor’s report is filed it must:
    • State the name of the auditor and (where the auditor is a firm) the name of the person who signed it as senior statutory auditor, or
    • If the conditions in s506 (circumstances in which names may be omitted) are met, state that a resolution has been passed and notified to the Secretary of State in accordance with that section.

Please note that where the profit and loss account is delivered the related notes should also be included in the notes to the accounts.

Scenario 3: Small company filing unaudited and abridged accounts in accordance with s444 of the Companies Act 2006

Key points for filing

  1. The directors of the company must file its balance sheet (the Companies Act definition of “Balance Sheet” includes related notes). In practical terms this means that most notes to the accounts will need to be filed.
  2. The directors of the company do not need to file either its profit and loss account (nor the related notes) or the directors’ report. (They of course have the options to file either or both).
  3. Where the balance sheet or profit and loss account is abridged (Section 1A of Schedule 1 to the Small Companies and Groups (Accounts and Directors’ Report) Regulations (SI 2008/409), the directors must also deliver to the registrar a statement by the company that all members of the company have consented to the abridgement as below: “All the members of the company have consented to the preparation of an abridged profit and loss account and balance sheet for the year ended xxxx in accordance with Section 444 (2A) of the Companies Act 2006.” This statement should be included within the accounts, therefore we would suggest that it is disclosed at the foot of the balance sheet filed.
  4. Where directors of the company do not file its profit and loss account or directors’ report then they must make the following statement in a prominent place on the balance sheet filed: “The company’s annual accounts and reports have been delivered in accordance with the provisions applicable to companies subject to the small companies regime.”
  5. Additionally, in relation to the non-filing of the profit and loss account only, the filed balance sheet must include the following statement:“As permitted by Section 444 of the Companies Act 2006, the directors have not delivered to the Registrar a copy of the company’s profit and loss account for the year ended xxxx”.
  6. The filed balance sheet and the directors’ report (if delivered), must state the name of the person who signed it on behalf of the board of directors.

Please note that where the profit and loss account is delivered the related notes should also be included in the notes to the accounts.

Scenario 4: Small company filing audited and abridged accounts in accordance with s444 of the Companies Act 2006

Key points for filing

  1. The directors of the company must file its balance sheet (the Companies Act definition of “Balance Sheet” includes related notes). In practical terms this means that most notes to the accounts will need to be filed.
  2. The directors of the company do not need to file either its profit and loss account (nor the related notes) or the directors report. (They of course also have the options to file either or both).
  3. Where the balance sheet or profit and loss account is abridged (s1A of Schedule 1 to the Small Companies and Groups (Accounts and Directors’ Report) Regulations (SI 2008/409), the directors must also deliver to the registrar a statement by the company that all members of the company have consented to the abridgement as below: “All the members of the company have consented to the preparation of an abridged profit and loss account and balance sheet for the year ended xxxx in accordance with Section 444 (2A) of the Companies Act 2006.” This statement should be included within the accounts, therefore we would suggest that it is disclosed at the foot of the balance sheet filed.
  4. Where the directors choose to file the profit and loss account they must also file a copy of the auditor’s report on the accounts (and any directors’ report) that they deliver.
  5. Where directors of the company do not file its profit and loss account or directors’ report then they must make the following statement in a prominent place on the balance sheet filed: “The company’s annual accounts and reports have been delivered in accordance with the provisions applicable to companies subject to the small companies regime.”
  6. Additionally, in relation to the non filing of the profit and loss account only:
    • the filed balance sheet must include the following statement:As permitted by Section 444 of the Companies Act 2006, the directors have not delivered to the Registrar a copy of the company’s profit and loss account for the year ended xxxx”. And
    • the notes to the balance sheet must:
      • State whether the auditor’s report was qualified or unqualified.
      • Where qualified, the basis of the qualification must be disclosed (reproducing any statement under s498(2)(a) or (b) or s498(3), if applicable.
      • Where report was unqualified, include reference to any matters which the auditor drew attention by way of emphasis.
      • State name of auditor and (where the auditor is a firm) the name of the person who signed the auditor’s report as senior statutory auditor, or in the very rare circumstances that s506 (circumstances in which names may be omitted) are met, that a resolution has been passed and notified to the Secretary of State in accordance with that section.
  7. The filed balance sheet and the directors’ report (if delivered), must state the name of the person who signed it on behalf of the board of directors.
  8. Where the auditor’s report is filed it must:
    • State the name of the auditor and (where the auditor is a firm) the name of the person who signed it as senior statutory auditor, or
    • If the conditions in s506 (circumstances in which names may be omitted) are met, state that a resolution has been passed and notified to the Secretary of State in accordance with that section.

Please note that where the profit and loss account is delivered, the related notes should also be included in the notes to the accounts.