Hi All,
I was wondering if somebody could help me. I have a new client and their previous accountant filed under FRS 102 section 1a when they could have filed under Micro.
This year the company has breached the Micro thresholds for the first time, but I wanted to see if anyone knew if the two year rule still applied if the previous accounts were filed under section 1A/
I believe the two year rule would still apply but just wanted to put the question out there in case anyone could convince me otherwise.
Thanks all
Replies (3)
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Are they likely to be above the threshold next year ?
If they are, I'd file FRS 102 1a anyway. I wouldn't be chopping and changing every year. The deferred taxation effect on profits would be one of the reasons I'd cite.
On the other hand, if this year is just a blip, imho, you're entitled to go for FRS 105. The determining factor is turnover/assets/employees and not what you did last year.
I would stick with what has gone before for reasons of continuity and client expectation, unless there is a compelling reason to change eg. the client instructs it because there would be a cost-saving.
At the end of the day, if there is a choice isn't it the client's?