The AICPA just announced its new Reporting Framework for Small- and Medium-Sized Entities (FRF for SMEs), which was created to streamline the financial reporting requirements for small to medium sized businesses.
Small and medium-sized, privately owned businesses, up until this point, may have struggled with their financial statements; in particular, how to prepare and streamline their financial statements. The FRF for SMEs is, in a nutshell, an accounting framework for businesses not subject to GAAP (Generally Accepted Accounting Principles) requirements.
It provides these businesses with the current, non-GAAP options available to them, and it provides it to them in an efficient, easy-to-understand fashion. In other words, it offers private businesses a modified GAAP that is designed to specifically address the private company environment.
Said Barry Melancon, president and CEO of the AICPA, the FRF for SMEs “gives private business owners two more viable options.” It was designed to provide simpler and more consistent financial statements for companies where GAAP is not a requirement.
Some of the benefits of the FRF for SMEs include:
The new framework is, according to the AICPA, what many businesses owners, community bankers and CPAs have been looking for. This reliable alternative to other financial options also provides both CPAs and accounting firms with more accounting options, while still providing streamlined, cost-beneficial statements to their clients.
The FRF for SMEs, which was developed by a group of CPA professionals, has been thoroughly tested and reviewed by CPAs and other industry professionals.