On 14 September 2011 Commerce Minister Simon Power announced proposals to simplify the financial reporting requirements of non-issuer small and medium-sized companies (defined as those with annual revenue of less than $30 million, or assets less than $60 million). Under the proposed reforms, these companies will no longer need to prepare general purpose financial reports (unless their shareholders require them to). Instead they will be required to prepare special financial reports for tax and other purposes. The changes are an attempt to cut business compliance costs and reduce the reporting burden. The New Zealand Institute of Chartered Accountants, Inland Revenue and other users (such as funding providers) will work closely together to develop the revised requirements and produce a set of guidelines.
The changes for small and medium-sized companies, along with proposed changes to reporting obligations of registered charities and other entities, are set out in a consultation paper prepared by the External Reporting Board (available here). Submissions are currently being sought on the consultation paper and are due by 5pm on 16 December 2011. The changes will be introduced to Parliament in a Financial Reporting Amendment Bill in 2012.