The Accounting Standards Board (ASB) has today published an Amendment to Financial Reporting Standard (FRS) 17 ‘Retirement Benefits’.

The Amendment aligns the disclosures in FRS 17 with those of the equivalent international standard, International Accounting Standard (IAS) 19. The ASB consulted on the Amendment in May 2006.

The Amendment will be effective for financial statements covering periods beginning on or after 6 April 2007, although early adoption is encouraged. It was proposed in the Financial Reporting Exposure Draft (FRED) to have an effective date for accounting periods ending on or after 31 December 2006. The ASB has decided to allow a longer implementation period in response to concerns from some commentators regarding the time required to prepare for the amended disclosure requirements.

The Amendment also amends to paragraph 16 of FRS 17, such that for quoted securities, the current bid price (rather than the mid-market value) is taken as fair value. This is a further alignment with IAS 19, on which the ASB consulted in July 2005.

The ASB is continuing its review of the matters raised in relation to the proposals in the May 2006 FRED for a best practice reporting statement. It is anticipated the Reporting Statement will be published in early 2007.

In issuing the Amendment Ian Mackintosh, Chairman of the ASB, stated:

“This Amendment aligns the disclosure requirements of FRS 17 with those of IAS 19. The aim of the Reporting Statement is to recommend disclosures that complement

the requirement of the amended FRS 17. The ASB is also continuing its work in relation to its research project which is a more fundament review of pension accounting. It is anticipated that a Discussion Paper setting out the ASB views will be issued in the first half of 2007.”

1. In May 2006 the ASB issued for comment a Financial Reporting Exposure Draft (FRED) which set out a proposed amendment to FRS 17 ‘Retirement Benefits’ and a draft reporting statement ‘Retirement Benefits – Disclosures’. The comment period for the FRED ended on 11 September 2006.
2. The proposal to amend paragraph 16 of FRS 17 was included as part of FRED 39 ‘Proposed amendment to FRS 12 Provisions, Contingent Liabilities and Contingent Assets and FRS 17 Retirement Benefits’, issued in July 2005.
3. The ASB is an operating board of the Financial Reporting Council (FRC). The FRC is a unified, independent regulator. Its mission is to promote confidence in corporate reporting and governance. The FRC incorporates six operating boards: the ASB, the Auditing Practices Board, the Board for Actuarial Standards, the Financial Reporting Review Panel, the Accountancy Discipline and Investigation Board and the Professional Oversight Board for Accountancy.
4. The role of the ASB is to issue accounting standards. The ASB collaborates with accounting standard-setters from other countries and the International Accounting Standards Board (IASB) both in order to influence the development of international standards and in order to ensure that its standards are developed with due regard to international developments.
5. The ASB has up to ten Board members, of whom two (the Chairman and the Technical Director) are full-time, and the remainder, who represent a variety of interests, are part-time.
6. The Amendment can be downloaded, free of charge, from the website at www.frc.org.uk/asb. Hard copies of the Amendment will be available shortly, price £2.30 (post free) from FRC publications, 145 London Road, Kingston Upon Thames, Surrey, KT2 6SR (020 8247 1264) Web: www.frcpublications.com
7. All press enquiries should be addressed to Ian Mackintosh (Chairman) on 020 7492 2434, David Loweth (Acting Technical Director and Secretary) on 020 7492 2420 or Michelle Crisp (Project Director) 020 7492 2432.