Guidance on filing micro entity accounts
ICAS has produced guidance for members to assist them when filing accounts with Companies House on behalf of their micro entity clients.
The filing obligations of companies subject to the small companies’ regime are contained in section 444 of the Companies Act 2006.
Micro-entities represent a subset of the small company category and should therefore comply with the requirements of this section. There is no separate section that deals specifically with the filing requirements of micro-entities.
Most micro-entities will prepare unaudited accounts and the options for micro entities with respect to filing unaudited accounts with Companies House are as follows:
- File the same set of micro-entity accounts that was prepared for shareholders.
- Use the option (as per section 444(1) of the Companies Act 2006 – not to file the profit and loss account and/or directors report (if one was prepared) i.e. normally one would file only the balance sheet and notes (which are usually very limited).
If option 2 above is used then the following balance sheet statements will be required:
(i) The directors consider that the company is entitled to audit exemption (as per the requirements of Section 477 of the Companies Act 2006);
(ii) The members have not required the company to obtain an audit of its accounts for the year in question in accordance with section 476; and
(iii) The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of accounts.
(iv) The accounts have been prepared in accordance with the micro-entity provisions (Section 414(3)- Preparation Basis).
(v) The company's annual accounts and reports have been delivered in accordance with the provisions applicable to companies subject to the small companies regime.
Therefore, what will be filed with Companies House for most unaudited micro-entities, will be the balance sheet plus notes as per the full set of accounts. None of the mandated notes for micro-entities are specifically related to the profit and loss account and thererefore such notes will need to be filed. The following illustrates what should be filed:
- Balance Sheet (Based on Format 1)
- Notes to the balance sheet as per section 472(1A) of the Companies Act 2006 which should appear at the foot of the balance sheet:
(a) advances, credit and guarantees granted to directors as required by section 413 of the Act (see paragraph 6A.1 in the Appendix to this Section); and
(b) financial commitments, guarantees and contingencies as required by regulation 5A of, and paragraph 57 of Part 3 of Schedule 1 to, the Small Companies Regulations (see paragraphs 6A.2 and 6A.3 in the Appendix to this Section).
- If additional notes have been prepared on a voluntary basis then unless these are directly related to items in the profit and loss account then they would need to be filed.
- Inclusion of balance sheet statements as described earlier.