The future of UK GAAP: Update

The Accounting Standards Board (ASB) has re-exposed revised proposals for the future of financial reporting in the UK and Republic of Ireland. 

The following exposure drafts were issued:

  • FRED 46 ‘Application of Financial Reporting Requirements’
  • FRED 47 ‘Reduced Disclosure Framework’
  • FRED 48 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland’

The re-exposed future of UK GAAP has come about as a result of feedback to previously issued FREDs 43 to 45 and this feedback resulted in significant changes to previous proposals.

The comment period is open until 30 April 2012 and you are well-advised to submit your feedback so that the ASB can act accordingly. The proposals are expected to come into effect for accounting periods beginning on or after 1 January 2015.

The changes

As with the previous exposure drafts, FREDs 46 to 48 recommend a full replacement of all current FRSs/SSAPs and Task Force Abstracts as well as introduce a reduced disclosure framework for qualifying entities. The FREDs also propose to retain the FRSSE but recommend a further consultation on how to update the FRSSE following the European Commission proposals for the future of financial reporting for small and micro companies.

The proposals will affect all companies that are required to prepare financial statements that give a true and fair view, including those which are not corporate entities. 

Continued...

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Comments
Nigel Hughes's picture

Well done Steve - that was quick

Nigel Hughes | | Permalink

Do we know which member of the ASB put forward an alternative view? It seems to make rather good sense!

Steve Collings's picture

Thanks Nigel

Steve Collings | | Permalink

Hi Nigel,

I'm not sure which ASB member put forward alternative views as yet as I wrote my article on Monday morning as soon as I found out the FREDs were on the ASBs website.  I didn't cover the member's alternative views in this article, purely because I just wanted to focus on what the ASB had changed from the previously issued FREDs (I knew from many delegates I meet on lectures there were particular concerns about the 'publicly accountable' concept, revaluations and deferred tax), which I think the ASB have done an excellent job in attempting to resolve. It's not quite there yet, but comments are open and I would actively encourage everyone whom these proposed changes will affect to voice their opinions - if the ASB don't get feedback, they can't act on it accordingly.

I have read the alternative views and I do agree with you - they are very logical and make a lot of sense, so let's see what happens going forward.  I am hoping this year will see a major breakthrough with all this uncertainty because I now feel we need a "right - this is where it's going - so get prepared for it" situation - because the profession has been in a state of uncertainty (I feel) for too long where this is concerned.  It's been a very long drawn-out project and I don't doubt for one minute that those at the ASB feel the same and it's clear the ASB are trying to juggle many respondents suggestions and feedback, which I think is also a good thing.

All the best,

Steve

Nigel Hughes's picture

Steve we clearly don't have enough to do at this time of year!

Nigel Hughes | | Permalink

I've got to section 11 and am struck that Winston Churchill might have said something like:

"Never has so much been written about documents which will be read by so few"

In the meantime my friend Chuck Berry, shortly after declining an invitation to join the ASB penned these lines which go to the tune of Memphis Tennessee

 

 

Helpline information won't you help me if you please

I need some information from these accounts in front of me

I just wanna know how much I've made this year gone by

For the banker and the taxman and maybe for my wife

 

Don’t need to know who it was who valued my property

That I'm paying into a pension scheme is not a mystery

Or operating lease payments between years two and five

Just wanna know how much I made so I can stay alive

 

Don't need no information ‘bout my 5 year debt

And Black-Scholes methodology ain't helped no one yet

What I need to know is am I a wealthy man?

Or if this little SME is going down the pan

 

Oh helpline information this is driving me insane

All this useless information that's clogging up my brain

Just looking for a number which means something to me

And now you say I have to turn to page two hundred and three