UK Financial Statements

UK Financial Statements Skill v1.0

Year applicability: Rules in this skill apply across 2024-25, 2025-26, and 2026-27 unless a specific section flags a year-dated change. The pack is read alongside the rate-bearing skills (uk-income-tax-sa100, uk-national-insurance, uk-dividends, etc.) which carry full 3-year tables.

Verified rates & thresholds (accountant-reviewed)

Reviewed against the cited tax authorities by James Power on 2026-06-03. Items flagged for further clarification are tracked separately and excluded here.

Financial Statements

• Micro — turnover — ≤ £1,000,000 (CA 2006 s.384A)
• Micro — balance sheet — ≤ £500,000 (CA 2006)
• Micro — employees — ≤ 10 (CA 2006)
• Small — turnover — ≤ £15,000,000 (CA 2006 s.382)
• Small — balance sheet — ≤ £7,500,000 (CA 2006)
• Small — employees — ≤ 50 (CA 2006)
• Medium — turnover — ≤ £54,000,000 (CA 2006 s.465)
• Medium — balance sheet — ≤ £27,000,000 (CA 2006)
• Medium — employees — ≤ 250 (CA 2006)
• Test — 2 out of 3 criteria in current + preceding year (CA 2006)
• Private company deadline — 9 months after year-end (CA 2006 s.442)
• Public company deadline — 6 months after year-end (CA 2006)
• Late filing penalty (private) — £150 to £1,500 (CA 2006 s.453)
• Micro/small company — Exempt from audit (CA 2006 s.477)
• Medium/large company — Required (CA 2006)
• 10% shareholder request — Overrides small company exemption (CA 2006 s.476)

Section 1 -- Quick Reference

Quick Reference

Field	Value
Country	United Kingdom
Currency	GBP
Filing authority	Companies House
Primary legislation	Companies Act 2006
Supporting regulations	The Small Companies and Groups (Accounts and Directors' Report) Regulations 2008; The Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008
Accounting standards	FRS 102 (full / Section 1A); FRS 105 (micro); UK-adopted IFRS (listed/choice)
Financial year	Any period up to 18 months; usually 12 months
Filing deadline	9 months after year-end (private); 6 months (public)
Late filing penalty	£150 to £1,500 (private); £750 to £7,500 (public)
Digital filing	iXBRL tagging required for corporation tax; online filing via Companies House

Section 2 -- Reporting Framework

Reporting Framework

Entity category	Applicable standard	Key features
Micro-entity	FRS 105	Highly simplified; no notes beyond statutory minimum; no true and fair override
Small entity	FRS 102 Section 1A	Simplified disclosures; abridged formats permitted
Medium entity	FRS 102 (full)	Full FRS 102 disclosures; some exemptions from filing certain information
Large entity	FRS 102 (full) or UK-adopted IFRS	Full disclosure requirements
Listed / AIM (with IFRS)	UK-adopted IFRS	Mandatory for consolidated accounts of listed groups
Qualifying subsidiary	FRS 101	IFRS recognition/measurement with reduced disclosures

Section 3 -- Size Thresholds

Effective for accounting periods beginning on or after 6 April 2025:

Size Thresholds (current)

Criterion	Micro	Small	Medium
Turnover	≤ £1,000,000	≤ £15,000,000	≤ £54,000,000
Balance sheet total	≤ £500,000	≤ £7,500,000	≤ £27,000,000
Employees	≤ 10	≤ 50	≤ 250

• Classification test — Must meet 2 out of 3 criteria in the current and preceding year. Companies exceeding "medium" thresholds are classified as large.

Previous thresholds (periods beginning before 6 April 2025)

Criterion	Micro	Small	Medium
Turnover	≤ £632,000	≤ £10,200,000	≤ £36,000,000
Balance sheet total	≤ £316,000	≤ £5,100,000	≤ £18,000,000
Employees	≤ 10	≤ 50	≤ 250

Section 4 -- Required Financial Statements

Required Financial Statements

Document	Micro (FRS 105)	Small (s1A)	Medium/Large
Profit and loss account	Required (very simple)	Required (abridged option)	Required (full)
Balance sheet	Required (very simple)	Required (abridged option)	Required (full)
Statement of changes in equity	Not required	Not required (optional)	Required
Cash flow statement	Not required	Not required	Required
Notes to accounts	Statutory minimum only	Reduced disclosures	Full
Directors' report	Not required (statutory presumption)	Required	Required
Strategic report	Not required	Not required	Required (large only)
Auditor's report	Not required	Not required (if exempt)	Required (medium with audit)

Section 5 -- Year-End Adjustments Checklist

Year-End Adjustments Checklist

#	Adjustment	UK-specific notes
1	Depreciation	FRS 102 Section 17; useful life basis; annual review of residual value
2	Accruals	Audit/accountancy fees, bonuses, utilities
3	Prepayments	Insurance, rent, software licences
4	Provisions	FRS 102 Section 21; present obligation, reliable estimate
5	Bad debt provision	Expected credit loss model (FRS 102 Section 11 simplified)
6	Inventory	Lower of cost and estimated selling price less costs to sell
7	Deferred tax	FRS 102 Section 29; timing differences approach (not temporary differences)
8	Holiday pay accrual	Required under FRS 102 — untaken leave at year-end
9	Lease accounting	FRS 102 Section 20 (finance/operating distinction — not IFRS 16)
10	R&D costs	Capitalise development costs meeting criteria (Section 18) or expense
11	Government grants	Accruals model or performance model (Section 24)
12	Director's loan account	S.455 CTA 2010 tax charge if overdrawn at year-end

Section 6 -- Profit and Loss Account Format

Companies Act 2006 Schedule 1 — Format 1 (vertical, by function) most common:

Turnover
Cost of sales
  ─── Gross profit ───
Distribution costs
Administrative expenses
Other operating income
  ─── Operating profit ───
Income from shares in group undertakings
Other interest receivable and similar income
Interest payable and similar expenses
  ─── Profit on ordinary activities before taxation ───
Tax on profit on ordinary activities
  ─── Profit for the financial year ───

Format 2 (by nature — alternative):

Turnover
Change in stocks of finished goods and WIP
Own work capitalised
Other operating income
Raw materials and consumables
Staff costs
Depreciation and other amounts written off assets
Other operating charges
  ─── Operating profit ───
(continue as Format 1)

Section 7 -- Balance Sheet Format

Companies Act 2006 Schedule 1 — Format 1 (vertical):

Fixed assets
  Intangible assets
  Tangible assets
  Investments

Current assets
  Stocks
  Debtors
  Investments
  Cash at bank and in hand

Creditors: amounts falling due within one year
  ─── Net current assets ───

Total assets less current liabilities

Creditors: amounts falling due after more than one year
Provisions for liabilities
  ─── Net assets ───

Capital and reserves
  Called up share capital
  Share premium account
  Revaluation reserve
  Other reserves
  Profit and loss account
  ─── Shareholders' funds ───

Section 8 -- Notes to Accounts

Minimum disclosures by entity size

Minimum disclosures by entity size

#	Disclosure	Micro (FRS 105)	Small (s1A)	Medium/Large
1	Accounting policies	Statutory only	Required	Full
2	Fixed assets movements	Not required	Required	Required
3	Financial commitments	Not required	Required	Required
4	Guarantees/contingencies	Required (on balance sheet)	Required	Required
5	Related party transactions	Not required	Required (s1A.12)	Required (Section 33)
6	Employee numbers	Not required	Average number only	Full breakdown + costs
7	Directors' remuneration	Not required	Required (total)	Required (detailed)
8	Audit fees	Not required	Not required	Required
9	Financial instruments	Not required	Basic only	Full (Section 11/12)
10	Deferred tax	Not required	If material	Required (Section 29)
11	Share capital	Not required	Required	Required
12	Dividends	Not required	Required	Required

Section 9 -- Filing Requirements

Filing Requirements

Item	Detail
Filing authority	Companies House
Filing method	Online (Software filing, Companies House WebFiling, or third-party)
Private company deadline	9 months after accounting reference date
Public company deadline	6 months after accounting reference date
First accounts	21 months from incorporation (private); 18 months (public)
Documents filed (small)	Abridged balance sheet + notes (P&L can be omitted from public record)
Documents filed (micro)	Balance sheet only (with statutory footnotes)
Documents filed (medium/large)	Full accounts + directors' report + auditor's report
iXBRL	Required for corporation tax filing to HMRC (not Companies House)
Language	English or Welsh

Late Filing Penalties (private companies)

Late Filing Penalties (private companies)

Delay	Penalty
Up to 1 month	£150
1–3 months	£375
3–6 months	£750
Over 6 months	£1,500

• Public company penalties — Public company penalties are doubled.

Section 10 -- Audit Requirements

Audit Requirements

Category	Audit requirement
Micro-entity	Exempt (unless part of non-small group)
Small company	Exempt (same thresholds as small company classification)
Medium company	Required
Large company	Required
Public company	Always required
Charity (income > £1m)	Required
Member of non-small group	Required (even if company itself is small)

Conditions that override small company audit exemption:

• Override conditions — Public company or member of group containing a public company; Regulated (banking, insurance, financial services); Shareholders holding ≥10% request audit (s.476 CA 2006); Part of an ineligible group (group exceeds small thresholds) (s.476 CA 2006)

Auditor qualification

• Registered Auditor — Must be a Registered Auditor (member of a Recognised Supervisory Body: ICAEW, ICAS, CAI, ACCA).

Disclaimer

This skill and its outputs are provided for informational and computational purposes only and do not constitute tax, legal, or financial advice. Open Accountants and its contributors accept no liability for any errors, omissions, or outcomes arising from the use of this skill. All outputs must be reviewed and signed off by a qualified professional before filing or acting upon.