There is a growing sense that regulatory requirements on businesses is burdensome, especially for small businesses. However, good news is on the horizon. In recognition of the challenges, having collected and analysed view of a wide range of stakeholders, the government recently published a summary of responses to its call for evidence. 

Key points that emerged are as follows: 

• Value of non-financial information – Most respondents saw value in non-financial information prepared by companies because it gives transparency and enables accountability. Preparers are alive to the fact that such information is increasingly expected by stakeholders of the company and some companies cite it as a key way to communicate their strategy. 
• Calls for simplification – All respondent groups identified that current reporting thresholds, exemptions and exclusions are too complex and would benefit from simplification. Many reported a degree of duplication in existing requirements and argued for the streamlining, or even removal, of certain areas such as the Directors' Report.  
• Too many smaller businesses are drawn into excessive non-financial information reporting - The majority of respondents who answered the question thought that the micro-entity, small, medium-sized and large company thresholds are no longer appropriate. Some suggested raising thresholds to reflect inflation increases. Others also called for action to be taken to reduce the burden of reporting on subsidiary companies. 

Ministerial statement 

In a recent ministerial statement, the government has outlined the following intended regulatory changes: 

• to raise the monetary threshold used for the classification of companies by 50%. The effect of this will be the reclassification of a significant number of companies enabling them to access more proportionate reporting and, in some cases, exemptions and the ability to file simpler accounts; 
• to remove certain obsolete or overlapping requirements from the Directors’ Report, and from the Directors’ Remuneration Report and Policy; and 
• to consult on proposals to increase the number of employees that makes a company “medium” from 250 to 500 and to exempt medium companies from the requirement to produce a strategic report. 

Many would agree it was high time for the government to take a fresh look at the UK’s corporate reporting framework. Whether the intended changes will deliver the cost-savings and economic growth that government predict? Time will tell.