Overview
The Financial Reporting Standard for Smaller Entities (FRSSE) was a beacon in the foggy world of accounting standards, tailored specifically for small but enterprising entities. Crafted by the virtuoso accountants of the Accounting Standards Board (ASB), FRSSE streamlined complex financial regulations into a user-friendly handbook, making the lives of many accountants and auditors considerably easier from its inaugural release in March 1999.
Purpose and Applicability
FRSSE was designed as a concise almanac that amalgamated the pressing requirements from an array of established accounting regulations and Urgent Issues Task Force (UITF) abstracts considered relevant for small entities. Its genius lay in its simplicity—small companies qualifying under UK company legislation could adopt FRSSE and, in doing so, gracefully bow out of the labyrinthine maze of other accounting standards and UITF abstracts.
Historical Evolution
The document saw several revisions over its lifespan to cater to the evolving landscape of financial protocols. Noteworthy updates were introduced in:
- January 2005
- January 2007
- June 2008
- June 2015
The 2015 update mirrored changes based on the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102), ensuring that FRSSE remained in lockstep with broader financial reporting evolutions.
Sunset of FRSSE
On the 1st of January 2016, the curtain fell on FRSSE. The march towards simplification and modernization continued as smaller entities not classified as micro-entities were transitioned to adhere to FRS 102.
This strategic move was akin to swapping an old but reliable typewriter for a sleek, new laptop—out with the old, in with the new, but still fundamentally about getting the story right.
Related Terms
- Small Companies: Entities that meet specific size criteria under company law, benefiting from simpler accounting and reporting requirements.
- UITF Abstracts: Concise summaries addressing urgent accounting issues that small entities could bypass with FRSSE.
- FRS 102: The comprehensive set of accounting standards that small entities now follow post-FRSSE.
Suggested Reading
- “Simplified Financial Reporting: A Guide for Small Businesses” - This book offers a comprehensive overview of frameworks like the FRSSE and practical advice on managing transitions to standards like FRS 102.
- “Accounting Standards Explained” - A textbook that delves deeper into the evolution of accounting practices, including the pivotal role of the FRSSE in shaping small business accounting.
Conclusion: The legacy of FRSSE is embodied in the lighter regulatory load small companies continue to enjoy—even as they operate under new standards. In the grand tapestry of financial reporting, the FRSSE was not merely a footnote but a pivotal chapter that helped write the success stories of myriad small enterprises. Laugh in the face of daunting financial documents, for FRSSE once made them a cake walk!
