More good news relating to the reduction of “Red Tape”! If your revenue is under $50m, your assets are less than $25m or you have less than 100 employees then read on.
The government is proposing to reduce the financial reporting burden for proprietary limited companies by increasing the thresholds for the small/large proprietary company test. Treasury have released an exposure draft which proposes to increase the thresholds as follows:
- the consolidated revenue for the financial year of the company and the entities it controls from $25 million to $50 million;
- the value of the consolidated gross assets at the end of the financial year of the company and the entities in controls from $12.5 million to $25 million; or
- the company and the entities it controls having 50 employees to 100 employees at end of the financial year.
Given most small companies are not required to lodge financial reports with ASIC, this decreases the reporting burden for those companies between the old and proposed new thresholds.
Since the introduction of International Financial Reporting Standards in Australia during 2005 the financial and reporting requirements (in particular disclosures) have increased dramatically. We have long argued the introduction of more onerous financial reporting requirements should coincide with a review of who needs to prepare and lodge financial reports with ASIC. At Moore Stephens, we see this as a positive step in reducing “Red Tape” and one we should all support.
The exposure draft is open for comment until the 14
th of December and we encourage all to respond in positive support of the proposal.
For more information see the link below:
https://treasury.gov.au/consultation/c2018-t342318/