Tax & Assurance Guidance

Financial Reporting Format for Small and Medium Sized Entities

Posted on July 12, 2012 by

Dave Van Damme

Dave Van Damme

Share This

Share on facebook
Share on twitter
Share on linkedin
Share on email

The AICPA has issued an FAQ on the Financial Reporting Framework (“FRF”) for Small and Medium Sized Entities (“SMEs”) that contains a relatively short design phase. The FAQ states the following facts:

  • The FRF is being developed by a working group of the AICPA that has experience in financial reporting for small and medium private companies
  • The FRF for SMEs will be drafted in 2012 and issued in the first half of 2013
  • The FRF for SMEs will be a standalone framework and will draw on traditional accounting methods
  • The AICPA does not have the authority to require the use of the FRF for SMEs for a reporting entity, therefore there is no effective date
  • As the project progresses, more information will be made available

What does this mean to you?

The FRF for SMEs is meant to be a cost beneficial and stream-lined reporting option where US GAAP financial statements are not required.

Often lending relationships are not based on financial statement reliance alone. In those situations, FRF for SMEs can be a viable option. We will continue to keep you apprised of the content of the FRF for SMEs as the project progresses. However, we suggest that you discuss the contents of your lending agreement, including financial covenant calculations and reporting requirements, with your financial advisors and lenders. You may be able to build flexibility into your lending documents to enable you to use the FRF for SMEs and gain all of the advantages.

Dave Van Damme

Shareholder

Dave leads the advisory & assurance practice and is well known inside and outside the firm for being both engaged & positive.

Related Insights

Tax & Assurance Guidance

Foreign Tax Withholding: What You Need to Know

Posted on April 26, 2022 by

Rob Cheyne
Making service payments to a foreign person is a common cross-border transaction. U.S. taxpayers need to be aware of the applicability of withholding tax and related reporting requirements to ensure they comply and avoid unintended consequences. A U.S. payor must collect withholding tax and remit it to the IRS in the case it is applicable.

Tax & Assurance Guidance

SALT Relief for Partners and S Corps

Posted on February 23, 2022 by

Miroslav Georgiev
With small businesses supporting nearly 47% of U.S. employees, states have been advocating for pass-through entities, operating partnerships and S corporations that have been harshly impacted by the Tax Cuts and Job Act ‘s state and local taxes deduction limit. Recent legislative activity is finally providing relief for many of these businesses. 

Tax & Assurance Guidance

IRS Provides Relief on K-2 and K-3

Posted on February 17, 2022 by

Margaret Amsden
In an attempt to provide more transparency with regard to reporting of foreign activity and/or information to foreign owners, the IRS came out with two new forms: Schedule K-2 (an addendum to the Schedule K) and Schedule K-3 (an addendum to the Schedule K-1). Learn about the latest K-2 and K-3 reporting requirements issued by the IRS.

Sign up for our newsletters

Get general business and industry-specific news and knowledge straight from our accounting specialists.

The Sound of Automation Podcast

The Sound of Automation Podcast

Industrial automation businesses are the driving force behind Industry 4.0, and Clayton & McKervey is here to help.

Insights & Perspectives

Data-driven decision making: 3 key insights for business owners

What does it take to build a data-driven business? For self-reliant leaders who feel they’ve hit a plateau when it comes to scaling a business, adopting a data-driven approach can be a breakthrough success strategy. Using data in a more focused way helps good engineers become good entrepreneurs. It’s about creating balance. Here we take a look at key insights for business owners when using data in decision making.

Read More

The Sound of Automation Podcast

Industrial automation businesses are the driving force behind Industry 4.0, and Clayton & McKervey is here to help.

Skip to content