ACCA has accused the Accounting Standards Board of undermining its own Financial Reporting Standard for Small Entities (FRSSE) by requiring ‘explicit and implicit cross-references’ to other accounting standards.
In the institute’s submission to the ASB, ACCA president Peter Langard said the burdens of compliance on small companies will remain unless the FRSSE, designed to relax reporting requirements, becomes a self-contained document.
‘The ASB should make it clear that its document is the only standard that needs to be considered for a true and fair view for smaller entity accounts,’ Langard said.
The proposed document reduces disclosure requirements for businesses employing 50 or fewer workers and whose annual turnover is below u2.8m.
For example, small companies would not have to disclose figures relating to acquisitions, continuing or discontinuing operations.
Langard also demanded the removal of ‘illogical restrictions on the use of the FRSSE by smaller companies’. New ASB standards should include a section on their applicability to the FRSSE, he added.
ACCA’s comments were dismissed by Deloitte & Touche technical partner Ken Wild. ‘ACCA is being unrealistic,’ he said. Wild, chairman of the CCAB working party which produced the proposals added: ‘People should stand back from their financial statements and if they believe there’s a problem, they should look at other standards and sources for guidance.’
Peter Mitchell, chairman of the Small Practitioners Association, said the FRSSE document was ‘impractical’.