McCreevy Announces Initiatives on Accounting Rules for Small Businesses

Charlie McCreevy, commissioner for the Internal Market and Services at the European Commission (EC), has announced a Member State option to exempt micro entities and a review of the Accounting Directives for small businesses. The EC and Member States are committed to reducing the administrative burden on SME’s by 25%. McCreevy said: “This is a difficult period. All the talk in the press is about the banks, the big financial institutions, and the mortgage lenders. We are all affected by what is happening. What we must not forget is that for small businesses, life goes on. They remain the backbone of the European economy. In the area of company law, for which I am responsible, we have already adopted measures aimed at reducing the administrative burden on SMEs. The total savings potential of the measures proposed, so far, in the area of company law is now €1bn per year.” He added that he believes the time has come to overhaul and modernise the Accounting Directives. “Of course, we can continue to make piecemeal changes – simplify the requirements for publication, disclosures and even the layout of the balance sheet. But there is no point in simply tinkering with the legislation. In this review, we will be guided by the ‘think small first’ principle,” he said.

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