Private firms and small and medium enterprises (SMEs) and their accounting firms face four key challenges according to a report by the British Accounting and Finance Association Financial Accounting and Reporting Special Interest Group (FARSIG).
The 2024 FARSIG symposium the Future of Finance Reporting–- held virtually with the support of ACCA – identified major issues for SMEs as:

  • Political uncertainty with rapid and complex regulatory change;
  • Cloud-based systems;
  • The increasing demand for sustainability reporting;
  • Plus the influence of these demands on the training of current accountants and the education of future ones.

Speakers’ presentations and the panel discussions highlighted the burdens that increasing regulations on financial and non-financial reporting impose on accounting firms as well as SMEs and private businesses in the UK. The symposium worked to make suggestions for regulators on how to reduce the severity of these burdens.

While the emerging trend in private business to move to cloud accounting offers numerous benefits to SMEs, the symposium also discussed the increasing concerns about data ownership and how these tools expose smaller enterprises to cybersecurity risks.

The symposium examined the ESG challenges that SMEs and private corporations face, with the increasing importance that ‘thinking and acting sustainably’ has for businesses.

All of these pressures highlight the existence of important gaps between accounting education and the skills that are needed in the accountancy profession. The symposium offered views on how these gaps could be closed.

As well as a panel discussion and question and answer session, FARSIG also heard from

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At the heart of all these debates is financial and non-financial reporting which remains a priority for FARSIG. Commenting on this, University of Essex professor of accounting, Silvia Gaia, said: “By debating the future trends and challenges in SMEs’ and private businesses’ corporate reporting, the symposium aimed to attract the attention of regulators and practitioners on these issues. In doing so, it also provides valuable contributions to the current project undertaken by the IASB aimed at reviewing IFRS for SMEs by supporting the need for more simplification and reduced disclosure requirements.”

A new edition of IFRS for SMEs issued by IFAC is expected in the second half of 2024.

ACCA head of sustainable business, policy, and insights, Sharon Machado, said: “The symposium’s discussion and ACCA’s research insights paint a complex picture for organisations to reflect upon in their investing, finance and operations decision-making. The picture includes a melee of geopolitics, monetary challenges, and technological, societal and environmental matters, all of which test the accountant’s capability for producing the good-quality information that is the necessary underpinning of equally good decisions.”