The companies are generally classified into three types according to accounting preparations. Small, medium and large companies. The company size relates to the information that needs to be included in the company accounts.
However, the small companies are further sub-categorized into micro-entity for extremely small companies based on below factor:
- The number of employees must not exceed 10
- The total turnover of the company must not exceed £632,000
- The total balance sheet assets of the company must not exceed £316,000
- Help in creating trial balance sheet
To be included in the list of micro-entity accounts company. The company must meet at least 2 of the above-mentioned conditions.
Moreover, there are several legal entities that aren’t allowed to make their accounts as a micro-entity accounts template such as:
- Limited Partnership
- Public Limited Company
- Limited Liability Partnership
- Charitable Company
- Unregistered Company
- Overseas Company
Micro-Entity Accounts Template:
The company is allowed to prepare micro-entity accounts if it is classified as micro-entity. Therefore, it includes the following details into its micro-entity accounts template.
- Balance sheet in a specified format including fixed assets, current assets, net current assets, total assets less current liabilities, and net assets
- Director’s report in a special format including the director’s signature
- Simplex Profit and Loss Accounts
- Company internal auditors account if any exemption isn’t claimed
Key Features of Excel Template
There are tons of advantages of using a micro-entity accounts template for the preparation of micro-entity accounts of a micro-entity. Let’s briefly discuss the benefits of micro-entity accounts itself and the template.
- The simplified and MS Excel nature of the template makes it easy to utilize.
- The template can be molded according to the business nature.
- It presents a balance sheet and profit loss sheet of the business in a very simplified format.
- It doesn’t require to prepare detailed notes of the company accounts.
- It doesn’t require filing the accounting sheets for the public.
- Sometimes an exemption of the director’s and auditors’ accounts can be claimed under special circumstances.
How to use a Micro-Entity Accounts Template?
The micro-entity template is useful for startups. It must be taken seriously and developed professionally. Moreover, if a company makes a habit of making micro-entity accounts even before registration. It will be quite helpful for the company to expand the business accounts to small accounts after developments.
The account of a micro-entity company is a simplified clubbed form of a developed company balance and income statement sheet.
- The balance sheet section of the micro-entity accounts template records details of company fixed assets and current assets.
- So, the net assets of a company at a certain time period are defined by subtracting the company current liabilities from the total assets.
The income statement section of the micro-entity accounts template includes the calculation of the company’s actual profit for the financial year or month. This calculation is based on total sales turnover after subtracting the cost of goods, other expenses, and tax.
Moreover, the micro-entity template is fully formulated and functional on just input of the key information required to generate the output.