Limited company for business is the most popular choice for many entrepreneurs and startup businesses. The privilege status of a limited company which provide limited liability to the owners and recognized as a separate legal entity to its shareholders make it very attractive business vehicle compared to sole trader form of business structure.
There are statutory obligations for trading as limited company. The law requires all limited companies to keep and maintain proper accounting records and statutory information for shareholders and for public record.
Accounting Records
It is the directors’ responsibility to ensure proper accounting records are maintained.
Company Accounts Format
The accounts of a limited company have to be prepared in accordance with the prescribed format set out by the Companies Act and in compliance with relevant accounting and auditing standards such as Statements of Standard Accounting Practice, Financial Reporting Standards, International Financial Reporting Standards and International Auditing Standards.
Audit Exemption
The company law requires all limited companies accounts to be audited unless the company meets the audit exemption eligibility criteria. For accounting periods starting from 6 April 2008, a limited company is not required to have their accounts audited if their annual sales are less than £6.5 million and the balance sheet total is not more than £3.26 million.
File Accounts to Companies House
Every limited company must file its accounts with the Registrar of Companies annually. Failed to do so, the company will automatically receive late filing penalty of £150 for a private limited company and £750 for a public limited company.
Abbreviated Accounts
Small and medium sized companies can file abbreviated accounts with the Registrar of Companies. The advantage of filing Abbreviated accounts is that of it provides less detailed information for public record.
Concise Accountancy provides accountancy services to limited companies. We also offer fixed fee accounting packages for startup business. Our business startup packages will help you to take care of all your company statutory obligations and provide you with the time making your business a success.
Concise Accountancy – Complete accountancy solutions for business
