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Easing the burden on small financial services
Trade and Industry Minister, Jim Fitzpatrick, has laid down regulations that could save small financial services companies some £15.25m a year in total.
The regulations will allow more companies to take advantage of accounting and auditing exemptions in the Companies Act 1985.
Small companies do not have to have their accounts audited, and are permitted to take advantage of less onerous accounting and reporting requirements. However, many companies regulated by the Financial Services Authority have been prohibited from taking advantage of the small company exemptions, despite otherwise meeting the criteria to qualify as small companies.
A study by the Financial Services Authority indicated that the cost of an audit for small regulated companies outweighed the benefits. The regulations will come into force on 8 November 2006 and will apply to financial years ending on or after 31 December 2006.
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