Companies House is also to be extensively reformed and one key change will see all smaller companies filing a profit and loss account.
There are some 4.4 million active companies registered with Companies House, and the vast majority of these are micro-entities or small companies.
Businesses in these two categories do not have to file a profit and loss account, and the information provided by a micro-entity can be as little as just three figures: total fixed assets, current assets and current liabilities.
Filing a profit and loss account will mean sensitive commercial information is readily available to a company’s competitors. Employees, customers, family members and any other interested parties will also be able to see how profitable a company is.
In addition, small companies will lose the option of preparing abridged accounts, so a full balance sheet will be required and small companies will have to file a directors’ report.
No dates yet for implementation but when we hear more we publish further guidance on these pages.