Accounting standard 'ignores SMEs'

News Article - 13 October 2006
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Draft accounting standard regulation for small and medium-sized enterprises (SME) has come under fire from a tax campaigner.

Richard Murphy criticised the draft as being irrelevant to small businesses during a United Nations meeting of experts in the field of accounting standards.

"It assumes the reporting requirements of all companies are the same, whatever their size. The result is a standard that will be over 200 pages long. Worse, it is not designed for the needs of a small business… simply cut down version of the standards used by larger companies," Mr Murphy said.

He goes on to add that the approach to the standard was "absurd" because it was created by a team mainly drawn from the big four companies who assumed that SMEs had at least 50 employees, representing "well under ten per cent" of normal SMEs.

According to the Department of Trade and Industry's Small Business Service, 99.3 per cent of the 4.3 million businesses set up last year were small in size, 0.6 were medium-sized and 0.1 per cent were large.

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