FRS 105 Financial Reporting Standard applicable to Micro-entities, Section 17 Liabilities and Equity is the financial reporting standard for micro-entities and its purpose in life is to simplify the requirements of the more expansive FRS 102.

But while FRS 105 is certainly simpler than the full UK GAAP, FRS 102, it is no less serious a financial reporting standard. It is based on foundations that are fundamentally similar to those of its bigger sibling and it is not for nothing that financial statements prepared under FRS 105 are said to be true and fair.