FRS 105 Micro Entity Accounts in Cumbernauld

FRS 105 is the UK financial reporting standard for micro-entities. It sets out how a qualifying company that chooses to apply the micro-entities regime should prepare its statutory financial statements, including the recognition and measurement rules and the disclosures required. It is intentionally simpler than the standards used by larger companies, with a largely historical cost basis and reduced disclosure, which keeps the resulting accounts shorter and more straightforward.

FRS 105 is intended for companies that qualify for the micro-entities regime and then choose to apply it. Qualifying is not the same as being required to use it. For accounting periods beginning on or after 6 April 2025, a company generally needs to meet at least 2 of 3 applicable size conditions: turnover of no more than £1 million, a balance sheet total of no more than £500,000, and an average of no more than 10 employees. Other eligibility rules and exclusions can apply, so meeting the size conditions alone does not automatically confirm eligibility — the position needs to be checked against your specific circumstances.

No. The micro-entities regime is an available accounting regime, not an automatic one. A company that qualifies may choose to apply it and therefore prepare FRS 105 accounts, or it may use a fuller framework instead — for example FRS 102. There can be good reasons to prefer a fuller framework, such as the way certain transactions are treated or what the accounts need to support. The decision should be made deliberately for each company rather than assumed.

Both are UK financial reporting standards, but they are aimed at different sizes of entity. FRS 105 is the micro-entities standard: it uses a simpler measurement approach and requires less disclosure, so the accounts are shorter and less complex. FRS 102 is the standard applied more broadly by small and larger entities, with more detailed recognition, measurement and disclosure requirements. In practice, the choice affects how items such as revaluations, certain financial instruments and deferred tax are handled, and how much detail appears in the notes.

A company's statutory accounts are filed at Companies House as part of its filing obligations, and where those accounts are prepared under FRS 105 they are filed on that basis. This is separate from your Corporation Tax position. A CT600 is a distinct return submitted to HMRC, and a Confirmation Statement is a separate filing again. It helps to treat accounts preparation and filing, Corporation Tax, and confirmation of company details as three different pieces of work with different deadlines and different purposes.

Yes, they are separate. FRS 105 accounts are the company's financial statements, prepared under the financial reporting framework for qualifying micro-entities. A CT600 is the Corporation Tax return submitted to HMRC. The figures in the accounts are often the starting point for the tax computation, but the return is its own document with its own requirements and its own submission channel. Preparing one does not automatically complete the other.

A newly incorporated company can potentially qualify for the micro-entities regime, but that depends on its circumstances rather than on how long it has been trading. A company in its first period may need to consider how its size is assessed where a period is shorter than a year, and any relevant exclusions. It is worth reviewing eligibility before preparing the first set of accounts so that the framework chosen is the one that actually suits the company.

Typically we would need your accounting records for the period, including bank statements and reconciliations, sales and purchase information, payroll details if you employ staff, details of assets and liabilities, and any relevant agreements such as loans or leases. It also helps to know your incorporation details, your accounting period dates and any prior year accounts. Once we see what you hold, we can tell you what else is needed and how to get it across to us.

The rules and filing arrangements for small and micro-entity accounts do change from time to time, and the micro-entity size thresholds were updated for accounting periods beginning on or after 6 April 2025. Rather than relying on an old checklist or a figure you read somewhere, it is worth having your position reviewed against the rules that apply to your particular accounting period. We can talk through what is relevant to your company in Cumbernauld and what it means for the accounts you prepare.