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Statements of Recommended Practice (SORPs)

 Policy on Developing Statements of Recommended Practice (SORPs) (March 2016)

SORPs are sector-driven recommendations on financial reporting, auditing practices and actuarial practices for specialised industries, sectors or areas of work, or which supplement FRC standards and other legal and regulatory requirements in the light of special factors prevailing or transactions undertaken in that particular industry, sector or area of work that are not addressed in FRC standards.  SORPs also address matters that are addressed in FRC standards, but about which additional guidance is considered necessary.  

To be recognised as a SORP-making body, a particular industry or sectoral body must meet criteria set by the FRC and must agree to develop SORPs in accordance with the Policy on developing SORPs. 

A SORP must carry a Statement by the FRC confirming, as appropriate, that the SORP does not appear to contain any fundamental points of principle that are unacceptable in the context of current financial reporting practice, auditing practice or actuarial practice, nor does it conflict with an FRC standard or undermine the FRC’s broader objectives.  

The Policy on developing SORPs also describes the role of the FRC in relation to SORPs. The table below sets out how this will operate within the current FRC structure:
Action Carried out by
Recognition as SORP-making body FRC Board Committee on advice of relevant Council
Statement on a SORP FRC Board or Board Committee on advice of relevant Council
Approval to publish draft of a SORP Council (on advice of Council advisory groups, as appropriate)
Review of a SORP Council advisory groups, as appropriate

SORPs and new UK GAAP

Information on SORPs and the new UK GAAP can be found here.

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