UK small owner-managed businesses: accounting and financial reporting needs

Suki Sian, Clare Roberts

Research output: Contribution to journalArticlepeer-review

53 Citations (Scopus)


Purpose – In recent years there has been a growing interest in the provision of financial information by small business entities. In the UK, regulation has taken the form of the Financial Reporting Standard for Small Enterprises (FRSSE) and internationally UNCTAD has issued its own reporting guidelines for small enterprises ahead of the International Accounting Standards Board's (IASB's) standard on the subject. Despite this international interest, academic research investigating the accounting and financial reporting needs of small enterprises remains relatively scarce. This UK-based study aims to assess the potential demand for and usefulness of reporting guidelines specifically designed for small owner-managed enterprises (SoMEs).

Design/methodology/approach – Using postal questionnaires, data were gathered from accountants providing services to SoMEs and the owners of such enterprises.

Findings – It was found that most SoMEs produce accounting records, often based on computerised packages. However, financial awareness varies significantly and there is evidence that most small enterprise owners rely on their accountants to prepare their financial statements and are often left bewildered by the complexity of the information provided. With UK and the future IASB standards being designed to meet the needs of the largest small and medium-sized enterprises (SMEs), there does appear to be a relatively high level of agreement that specific guidance for much smaller entities would be desirable. However, many of the accountants felt that some aspects of existing regulations, such as the UNCTAD level 3 guidelines, were too complex, indicating that regulators need to carefully consider the contents of regulations for the smallest entities.

Origniality/value – The findings of this study have implications for regulators who are now considering the possibility of developing guidance for the smallest business entities.
Original languageEnglish
Pages (from-to)289-305
Number of pages17
JournalJournal of Small Business and Enterprise Development
Issue number2
Publication statusPublished - 2009


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