Whether you are legally obliged to have an audit or not, annual reporting requirements are not optional. They are required by law and failure to submit them to the deadline can result in harsh penalties.
The amount of information you have to submit depends on the size of your business. There are effectively 4 classifications of size: large, medium, small and micro-entity. The classification is determined by various thresholds for annual turnover, the balance sheet and average number of employees. It also depends on which body you are submitting them to.
Whilst companies that qualify as micro-entities, small or medium-sized business can submit abbreviated accounts for Companies House, all sizes of business must submit full statutory accounts to HMRC with their company tax returns.
What are full statutory accounts?
HMRC requires the following:
- balance sheet detailing the value of everything the company owns and is owed on the last day of the financial year and must be signed by a director
- profit and loss account showing the company’s sales, running costs and the profit or loss it has made over the financial year
- notes about the accounts
- director’s report.
What are abbreviated accounts?
Companies House will accept the following as abbreviated accounts:
- balance sheet from your company’s statutory accounts, signed by a director
- notes about the accounts.
Please note you will still have to prepare full accounts for your shareholders.