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FRS102a or FRS105

Property Letting business FRS102a or FRS105

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A small group of two limited companies. Businsess Letting Properties. Leasehold and Freehold. Could some one advise if the accounts to be prepared

under FRS102a or FRS105. I think FRS102a applies but would like to seek assurance or otherwise ad vise, please.


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22nd May 2018 19:27

Presumably your accountant has given you the option of either format. Perhaps you can get them to explain the pros and cons of each to help you decide - I am sure they will be happy to do so, and they will be much better placed to discuss your needs than random strangers on an internet forum.

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to Tim Vane
22nd May 2018 23:35

Thanks Tim. I understand that it is one or the other, no
point of knowing pros and cons of FRS105 and 102a.
Which the correct to use.

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to nathluthra
23rd May 2018 09:17

Assuming you met the thresholds, you could use either.

You DO need to understand the pros/cons, so as per Tim’s response, speak to your accountant who can properly advise.

He gave you HIS OWN time to FREELY respond to your question OUT OF THE GOODNESS OF HIS HEART, when no-one else had, to give you some advice; it’s plain rude to tell him his advice is irrelevant when you don’t understand that it’s not.

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to atleastisoundknowledgable...
24th May 2018 16:58

I do not think I can use one or the other. I am quite familiar with two FRSs and as I had posted the question "which of the two is the correct one to use?". I did not need to write an essay on the two FRSs and therefore there was is no need for me to know Pros and Cons. The manner in which you say that Tim me gave me "his own time to freely respond......out of the goodness of his heart......" is very discourteous. Perhaps my question was not properly understood and there was no answer given to my question. I needed an answer not an advice.
Thanks for your response to my question and I am quite aware of the deferred capital gain tax provision.

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23rd May 2018 10:18

To add detail to the above, you need to measure if the benefit of say FRS102, which say allows property revaluation re investment properties but will need deferred tax calculated each year re same, is worth possibly additional accountancy and valuation fees and costs.

The choice of framework re a property letting business will likely need to consider the views and perceptions of both self and also say banks and other external lenders, both current and in the future.

There is no one answer and there are other facets of the disclosure and recognition regimes to consider .

As has been advised a chat with your accountant ,who hopefully knows you and your business, including your future plans etc, is likely a very good idea.

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24th May 2018 17:02

Thanks DJKL. I appreciate your response. By looking further in the two FRSs, I find the correct FRS to apply
is FRS102a. Since it is a small company, I believe the
director's valuation should hold good.

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to nathluthra
24th May 2018 18:58

Subject to 1AC.22

I personally would generally opt for FRS102a for a property company where I had external lenders but not fully sure ,if there were no external borrowings, as in that case it is likely shareholders would probably already have their own views re investment property values, irrespective of the statutory accounts.

A lot would depend on my proposed use of the accounts and the assets/turnover/ employee number tests.

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