UK GAAP is dead, long live UK GAAP!
May 2014
BUSINESS WITH CONFIDENCE
© ICAEW 2014
icaew.com
Overview
The current UK regime
Outline of the new UK regime
FRS 102 The Financial Reporting Standard
Resources
BUSINESS WITH CONFIDENCE
© ICAEW 2014
icaew.com
Current UK financial reporting regime
BUSINESS WITH CONFIDENCE
© ICAEW 2014
icaew.com
The current UK financial reporting regime
EU-adopted IFRSs
UK GAAP
(excluding the
FRSSE)
FRSSE
BUSINESS WITH CONFIDENCE
• Mandatory for listed and AIM companies in
the consolidated financial statements
• Can be voluntarily adopted by most other
companies
• Available to all companies not required to
apply EU-adopted IFRSs
• Includes FRSs, SSAPs, UITF Abstracts
• Available to most ‘small’ companies, as
defined by CA 2006
© ICAEW 2014
icaew.com
New UK financial reporting regime
BUSINESS WITH CONFIDENCE
© ICAEW 2014
icaew.com
The new standards
BUSINESS WITH CONFIDENCE
© ICAEW 2014
icaew.com
FRS 100 The application requirements
BUSINESS WITH CONFIDENCE
What
standards to
apply
When to
follow a
SORP
When can the
Reduced
Disclosure
Framework
apply
Transitional
arrangements
© ICAEW 2014
icaew.com
FRS 101 Reduced Disclosure Framework
Available for individual
financial statements of
parents and subsidiaries
List of disclosure
exemptions from
EU-adopted IFRS
Qualifying
entities
Accounts are Companies
Act accounts therefore
must comply with legal
requirements
BUSINESS WITH CONFIDENCE
Statements otherwise
comply with EU-adopted
IFRS
© ICAEW 2014
icaew.com
FRS 102 The Financial Reporting Standard
Based on IFRS for SMEs
– but with differences
Wider scope
More accounting options
Reduced disclosures for
qualifying entities
35 sections
Replaces FRSs, UITF
Abstracts and SSAPs
BUSINESS WITH CONFIDENCE
© ICAEW 2014
icaew.com
What are the options?
EU-adopted IFRS
 Mandatory for listed and AIM companies
 Can be voluntarily adopted by most other
companies
Reduced Disclosure
Framework (FRS 101)
 Qualifying entities who otherwise adopt the
recognition, measurement and disclosure
requirements of EU-endorsed IFRS
The Financial
Reporting Standard
(FRS 102)
 For all entities not applying EU-adopted IFRS,
FRS 101 or the FRSSE preparing financial
statements which give T&F view
FRSSE
 Available to most ‘small’ companies, as defined
by CA 2006
BUSINESS WITH CONFIDENCE
© ICAEW 2014
icaew.com
Effective date
Mandatory
adoption
Early
adoption
Periods
commencing
1 January
2015
Periods
ending 31
December
2012
BUSINESS WITH CONFIDENCE
© ICAEW 2014
icaew.com
BUSINESS WITH CONFIDENCE
1 January
2015
© ICAEW 2014
Period end
1 January
2014
Period commencing
Date of transition
Effective date
31
December
2015
icaew.com
FRS 102 The Financial Reporting
Standard applicable in the UK and ROI
BUSINESS WITH CONFIDENCE
© ICAEW 2014
icaew.com
Format of the financial statements
Primary statements
• Statement of financial
position
• Separate income
statement and statement
of comprehensive income
or single statement of
comprehensive income
• Statement of changes in
equity
• Statement of cash flows
Notes
BUSINESS WITH CONFIDENCE
Company law formats continue to apply
Flexible regarding the titles of the primary
statements
A single statement of income and retained
earnings may be presented in some
circumstances
The statement of cash flows analyses
movements in cash and cash equivalents
between changes arising from operating
activities, investing activities and financing
activities
© ICAEW 2014
icaew.com
Mind your language
BUSINESS WITH CONFIDENCE
© ICAEW 2014
icaew.com
Major differences
Deferred tax
Investment properties
Defined benefit pension plans
Holiday pay accruals
Lease incentives
Useful life of goodwill & intangibles
Identifying goodwill and intangibles
Financial instruments
BUSINESS WITH CONFIDENCE
© ICAEW 2014
icaew.com
Financial Reporting Faculty resources
BUSINESS WITH CONFIDENCE
© ICAEW 2014
icaew.com
New UK GAAP Resources
BUSINESS WITH CONFIDENCE
© ICAEW 2014
icaew.com
icaew.com/newukgaap
BUSINESS WITH CONFIDENCE
© ICAEW 2014
icaew.com
New UK GAAP FAQs
BUSINESS WITH CONFIDENCE
© ICAEW 2014
icaew.com
FRF iPhone, iPad and Android
App – free to download
BUSINESS WITH CONFIDENCE
Standards Tracker
example
© ICAEW 2014
icaew.com