The publication of Financial Reporting Standards 100, 101 and 102 sets out the future shape of accounting and financial reporting in the UK. This new financial reporting regime presents the following choices for those companies which are not required to use EU adopted International Financial Reporting Standards (EU-IFRS).
- The Financial Reporting Standard for Smaller Entities (FRSSE) can be used by eligible companies;
- FRS 101 Reduced Disclosure Framework (FRS 101) provides, where eligible, substantial disclosure exemptions for those companies electing to use EU-IFRS; or
- FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) which will replace current UK GAAP.
These standards must be applied for periods beginning on or after 1 January 2015.
Application of new standards will require restatement of comparatives and adjustments at transition. For most UK entities, FRS 102 is likely to be the preferred choice. FRS 102 derives from EU-IFRS and brings about some significant accounting changes and choices that may have commercial implications. Consequently the accounting policy choices require careful consideration.
Our publication New UK GAAP – are you ready? provides an overview of the new regime, the key accounting and commercial implications arising from the use of FRS 102 and the timeline for transition.