As a result, the Financial Reporting Council (FRC) has updated FRS 102 and FRS 105 to include details of the threshold changes coming into effect from 6 April 2025, which will reduce the reporting burden for thousands of companies, particularly micros and larger SMEs.

The key changes see an increase in the turnover and balance sheet criteria that help determine whether a company is a micro-entity or small, or medium-sized, or large by approximately 50%. These changes also apply to limited liability partnerships (LLPs).