FRC publishes new editions of UK accounting standards
The Financial Reporting Council (FRC) has published new editions of all UK and Ireland accounting standards, which now reflect all updates and amendments made since the previous versions were issued.
The most significant changes are those arising from the first triennial review of FRS 102 which were originally published in December 2017.
The changes made as a result of the triennial review were mostly incremental changes and clarifications, in many cases addressing implementation issues reported to the FRC by stakeholders.
The main changes to FRS 102 are:
- The introduction of an accounting policy option for investment properties rented to group companies to be measured at either cost or fair value, in order to avoid a mismatch in the treatment in the individual and group financial statements
- The introduction of a principles-based description of a ‘basic financial instrument’ to complement the existing list of criteria that such instruments must meet, in order to expand the number of financial instruments that can be measured at amortised cost
- A simplification for small entities in the accounting for loans from directors and their close family members, so that these can be recognised at transaction cost rather than present value
- A reduction in the number of intangible assets that need to be recognised separately in a business combination
- A simplification in the definition of a ‘financial institution’
- Clarification of the treatment of gift aid payments from subsidiaries to their charitable parents.
For micro-entities, the new edition of FRS 105 clarifies that employee numbers should be disclosed in the accounts under Section 411 of the Companies Act 2006.
In general, these amendments are effective for accounting periods beginning on or after 1 January 2019, with early application available.
The new editions of the standards are available from the FRC.