THE BIG QUESTION - FDs divided over new standardised accounts
More than half of finance directors favour the Department of Trade & Industry’s plan to introduce a 20-page standard form set of accounts for small businesses with turnover of less than #3m.
FDs who welcome the move see the new format accounts as a source of more information and a cost-cutting opportunity.
But one-third of FDs from small businesses and a quarter from medium and large-sized companies oppose the new accounts, saying the proposed obligation will increase costs and workload while offering no commercial benefit.
These are the results of a survey of 200 FDs for The Big Question, a service commissioned by Accountancy Age and Reed Accountancy Personnel.
Chris Wallis of the Oxford Swindon and Gloucester Co-operative Society commented: ‘Standardisation should assist in keeping the cost of preparing and auditing such accounts at a reasonable level.’
Jeremy Cornford of Iron Trades Insurance Group argued: ‘It makes it easier to deal with such smaller companies from a pre-planned basis.’
However, Manoj Bhardwaj of Chamberlain Hotels said: ‘Small companies will derive little benefit from a 20-page set of accounts related to 12 months ago.’
Paula Norman of Charterhouse Clinical Research Unit explained: ‘For small businesses disclosing – especially to their competitors – 20 pages of information, compared to abbreviated accounts, may be the difference between them carrying on or going under.’
Kevin Tomilson of car number plate maker Signam feels that if the accountancy profession ‘had got its act together on this issue, then the DTI would not be getting involved’.
