1. In a nutshell, what does a micro-entity need to file at Companies House?

The filing requirements for entities taking advantage of the micro-entities regime (micro-entities) operate under what is sometimes referred to as a ‘file what you prepare’ model. The basic principle is that the accounts filed at Companies House are the same as those prepared for the members. 

Micro-entities can, however, choose to not file the profit and loss account. If taking up this option, a micro-entity need only file its balance sheet, including the information disclosed at the foot of the balance sheet, at Companies House. These so-called ‘filleted’ accounts are discussed further in questions 2 to 6 below.

2. Can a micro-entity take advantage of the exemption available under s444 and not file the profit and loss account?

Yes, as noted above, micro-entities have the option of filing what are sometimes referred to as ‘filleted’ accounts ie, they can elect not to file the profit and loss account with Companies House.

If a micro-entity chooses not to file the profit and loss account, then the balance sheet must contain a statement that the accounts have been delivered in accordance with the small companies regime.

The above statement should not be confused with the separate statement required on the balance sheet to note that the accounts have been prepared in accordance with the provisions available to micro-entities. This statement is required by all entities applying the micro-entities regime and should appear in a prominent position on the balance sheet above the signature.

3. Which notes do I need to include if I decide not to file the profit and loss account?

If a profit and loss account is not filed, there is no need to file any notes that relate solely to it.

There are no mandatory notes under the micro-entities regime that relate to the profit and loss account. However, if additional notes, over above those required by law, have been included in the micro-entity accounts, these may be omitted from the accounts filed at Companies House if they relate directly to a profit and loss account line item.

Notes specifically relating to the balance sheet and any other notes to the accounts must be included in the accounts filed at Companies House.

4. Can I exclude details of employee numbers from the ‘filleted’ accounts?

As noted above, if a profit and loss account is not filed, there is no need to file any notes that relate specifically to it. There has, however, been some debate about whether the ‘employee numbers’ note is or isn’t a profit and loss account note and whether it can be omitted.

The consensus view appears to be that the ‘employee numbers’ note is not a note specifically related to the profit and loss account and therefore should be included for filing.

5. Do the members need to approve the ‘filleted’ accounts before the accounts are filed?

While the balance sheet filed with Companies House in paper format must include the name of the person approving the accounts on behalf of the board, there is no requirement in the law for the members to formally approve the ‘filleted’ accounts.

6. Do I need to include the audit report in the accounts filed at Companies House?

If an audited micro-entity does not file its profit and loss account, then it is not required to file the audit report. Unlike a company in the small companies regime, the micro-entity is not then required to include a note to the balance sheet regarding the audit. As a result there is no indication in the filed accounts that they were subject to audit.

Alternatively, if an audited micro-entity does choose to file its profit and loss account then it is required to file the audit report.

7. This all sounds quite complex to me. Is there a concise summary showing what needs to be filed with Companies House in different situations?

Appendix 1 to these FAQs provides a summary of what in our view needs to be filed in a number of common scenarios.

8. Where can I find examples of the various statements and notes that I may need to include in the accounts filed at Companies House?

Appendix 2 to these FAQs includes examples of the statements and notes that will typically be included in micro-entity accounts.

9. Are any additional resources available?

More information on the micro-entities regime can be found at icaew.com/smallcompanyreporting.

ICAEW members and ACA students can access a selection of new UK GAAP model accounts and disclosure checklists at www.icaew.com/frs105. It is always important to complete disclosure checklists as relying on software may not always ensure that all of the right disclosures are made.

ICAEW members can contact our Technical Advisory Service on +44 (0)1908 248 250 for confidential, expert advice.

Appendix 1 - Common scenarios under the Micro-Entities regime

The following table does not identify all the statements that may be required in accounts prepared under the micro-entities regime. Instead, it focuses on any additional statements and notes that may be required in the accounts filed at Companies House, depending on the individual circumstances of the micro-entity.

¹ Unlike small entities, a micro-entity does not have the option to prepare and file abridged accounts.

² As noted in question 4, all micro-entity accounts must include a balance sheet statement that the accounts have been prepared in accordance with the provisions available to micro-entities [CA 2006 s414(3)]

Appendix 2 - Example statements for inclusion in the accounts

Example statement: applying the micro-entities regime

These accounts have been prepared in accordance with the provisions available to micro-entities.

Example statement: balance sheet wording when profit and loss account not filed

These accounts have been delivered in accordance with the provisions applicable to companies subject to the small companies regime.

In accordance with those provisions the profit and loss account has not been delivered to the Registrar of Companies.