UK GAAP to FRSSE 15, early adoption of FRS 102 Section 1A or FRS 102
The Financial Reporting Council (FRC) has replaced UK GAAP (United Kingdom Generally Accepted Accounting Practice) with effect from periods beginning on or after 1 January 2015.
Now we are into 2016 we have been working hard to complete the first sets of accounts where a mandatory change is required, however, there are a number of options to consider when applying the new accounting standards for the first time;
- Apply FRSSE 15 (Financial reporting standard for smaller entities), which replaces FRSSE 2008. This is only available for “small” companies for one year, being periods commencing 1 January 2015 to 31 December 2015, after which a change to FRS 102 or FRS 102 Section 1A (as discussed below) is required.
- Apply FRS 102 (Financial reporting standard 102 – The Financial Reporting Standard applicable in the UK and Republic of Ireland).
- Early adopt FRS 102 Section 1A. This is only available for “small” companies.
There are a number of issues to consider when choosing the correct standard to adopt and we have found in the majority of cases, particularly for our owner managed businesses, that it is more beneficial to early adopt FRS102 Section 1A or FRS 102 (if applicable) now rather than take a staggered approach, this being due to discrepancies in the treatment of certain items under FRSSE 15 compared to FRS 102 especially concerning Goodwill.
Where did all the abbreviated accounts go?
There is no option to file abbreviated accounts under FRS102 this has been replaced with “abridged accounts”. When filing abridged accounts there is the option to remove the profit and loss account, however, the full notes to the accounts are now required to be submitted, which means there will be an increase in the level of information available about the business, which is in the public domain.
Key changes arising from FRS 102
We previously noted the key changes arising from FRS102, you can look back on this article and details of these changes in the post Financial Reporting Standar -FRS102
If you have any queries or concerns, please do not hesitate to contact us on 01872 271655