The European Union yesterday called on Member States to participate in a major review of the accounting directives for small to medium-sized businesses to help reduce the administrative burden on them.

EU Commissioner for the Internal Market and Services, Charlie McCreevy, said that during the current “difficult period” of ongoing economic instability in business, SMEs could be easily overlooked.

“All the talk in the press is about the banks, the big financial institutions, the mortgage lenders. We are all affected by what is happening. What we must not forget is that for small businesses, life goes on,” said McCreevy. “They remain the backbone of the European economy.”

He said the EU has already adopted measures aimed at cutting through red tape for SMEs, as well as saving businesses cash in the area of company law for mergers and divisions. McCreevy claimed that 1bn Euros a year have been kept in the kitty since measures were fast-tracked in 2007 and April this year.

He said, however, that the EU hasn’t gone far enough on accounting rules for SMEs.

In July 2008 an independent finance group led by Edmund Stoiber presented a report to the EU in which it found immediate savings of 5.7bn Euros if small businesses were exempt from the accounting framework and no longer had to prepare annual accounts.

Despite some initial objections to the findings among the Stoiber group, proposals were put forward to McCreevy in July to overhaul the system and exempt “micro entities” from the current accounting rules.

The Commissioner said that adopting the proposals would be of benefit to European business and offer a better solution than simply making “piecemeal changes” in the current economic environment.

Our Random Articles

• Small businesses plan staff cuts in early 2012
• Unemployment rise – what does this mean for small businesses?
• The Mary Portas Review
• Experts Warn Small Firms of the Need to be More Aware of IT Security Risks
• SMEs Unprepared for New Pension Reforms

More Links