For accounting periods beginning on or after 1 January 2016 the new small company limits are now defined as:
· Annual turnover of less than £10.2 million
· Balance sheet total of less than £5.1 million, and
· Fewer than 50 employees
The new limits above will also apply to audit exemption thresholds.
Directors can adopt the new small company limit rules early for accounting periods beginning on or after 1 January 2015. This would have the benefit of meaning a company that is currently medium-sized – but would be small under the new limits – can move directly to accounting under FRS 102, with reduced disclosure for small companies, rather than having to include the full disclosure for just one year.
Please take care though as the new audit exemption thresholds cannot be adopted early and relate only to accounting periods beginning on or after 1 January 2016.
To qualify as a Medium-sized company the limits will be:
· Annual turnover of less than £36 million
· Balance sheet total of less than £18 million, and
· Fewer than 250 employees
Please ask us for more information or further clarification.