AIM businesses have had to resolve their problems with much smaller finance teams than those engaged by larger corporates, putting a huge individual burden on staff.

John Cowie, head of AIM services at Smith & Williamson, said: ‘Inevitably, smaller companies have smaller finance departments, which have to work proportionately harder to comply with the strictures of becoming public.

‘Add to this the introduction of a new set of financial reporting standards and it is no surprise that IFRS is seen as an unwelcome burden. We have had to help many AIM companies with the transition over the course of the last year.’

AIM corporates have been brought in line with companies on the main market by having to present IFRS­compliant accounts for reporting periods beginning on or after 1 January 2007.

Standard setters took a tough stance, despite the troubles that the minnows appear to be labouring under. An IASB source said: ‘It’s just part of being a listed company. The report also said that twice as many companies were considering stepping up to the main market compared to last year, so IFRS compliance will benefit these corporates.’

The attractiveness of AIM also hinges on the tax breaks that investors enjoy, but the proposed introduction of an 18% flat rate of capital gains tax on 6 April has been a major blow. Currently shareholders of AIM companies pay a tax rate of 10% on the gains they make when they sell their stakes after a minimum of two years of ownership.

S&W also found that the credit crunch has proved in one way to be a blessing in disguise for AIM because of the sluggishness of the capital markets.

‘Ironically, the government has been fortunate that we are in a bear market right now and there are few capital gains to be made,’ Cowie added. ‘This might, otherwise, have precipitated a sell-off of AIM stocks before 5 April which could have been disastrous for business owners and investors alike.’