Projects Completed Since March 2013

Completed projects by the Accounting and Reporting Policy Team.
 
The FRC issued FRED 76 Draft amendments to FRS 102 and FRS 105 – COVID-19-related rent concessions  on 23 July 2020.
 
It proposes amendments to introduce explicit requirements for accounting for temporary rent concessions for operating leases occurring as a direct consequence of the COVID-19 pandemic, and within a limited timeframe.
 
The comment period ends on 1 September 2020.

Finalised as Amendments to FRS 102 and FRS 105 - COVID-19-related rent concessions (PDF) issued in October 2020.
The FRC issued FRED 75 Draft amendments to FRS 104 – Going concern on 23 July 2020.
 
It proposes amendments to clarify the requirement to assess the going concern basis of accounting; and require the disclosure of any related material uncertainties when preparing interim financial statements in accordance with FRS 104.
 
The comment period ends on 1 September 2020.

Finalised as Amendments to FRS 104 Interim Financial Reporting - Going concern (PDF) issued in October 2020.
 
The FRC issued FRED 74 Draft amendments to FRS 102 - Interest rate benchmark reform (Phase 2) on 29 May 2020.
 
It proposed amendments to provide relief to minimise discontinuities in the accounting for financial instruments and leases, and avoid unnecessary discontinuation of hedge accounting as agreements are modified in order to transition to alternative benchmark rates as interest rate benchmarks are being reformed.
 
The comment period ended on 30 September 2020.
 
Finalised as Amendments to FRS 102 – Interest rate benchmark reform (Phase 2) issued in December 2020.
 
The FRC issued FRED 73 Draft amendments to FRS 101 – 2019/20 cycle  on 16 December 2019.
 
It proposed two minor amendments to improve the consistency of the disclosure exemptions in relation to the statement of cash flows and related disclosures.
 
The comment period ended on 16 March 2020.
 
Finalised as Amendments to FRS 101 - 2019/20 cycle  issued in May 2020.
 

The FRC issued FRED 72 (Draft amendments to FRS 102 - Interest rate benchmark reform) on 11 July 2019.

It proposed amendments to specific hedge accounting requirements to provide relief, that will avoid unnecessary discontinuation of hedge accounting during the period of uncertainty as interest rate benchmarks are being reformed.

The comment period ended on 20 September 2019
Finalised as Amendments to FRS 102 – Interest rate benchmark reform issued in December 2019.

The FRC issued FRED 71 Draft Amendments to FRS 102: Multi-employer defined benefit plans on 29 January 2019.

It proposed amendments to Section 28 Employee Benefits for presenting the impact of transition from defined contribution accounting to defined benefit accounting. Such a transition is required when sufficient information becomes available for an employer participating in a multi-employer defined benefit plan to apply defined benefit accounting.

The comment period closed on 31 March 2019.

Finalised as Amendments to FRS 102: Multi-employer defined benefit plans issued in May 2019 

 
The FRC issued FRED 70 Draft amendments to FRS 101: Reduced Disclosure Framework - 2018/19 cycle on 29 January 2019.

It proposed that insurance entities shall not be permitted to reply FRS 101 if IFRS 17 Insurance Contracts is part of EU-adoped IFRS.

The comment period closed on 30 April 2019.

Finalised as Amendments to FRS 101 - 2018/19 cycle.

The FRC issued FRED 69: FRS 101 Reduced Disclosure Framework - 2017/18 cycle on the 30 October 2017. The comment period closed on 2 February 2018.

Finalised as part of Amendments to the Basis for Conclusions FRS 101 Reduced Disclosure Framework – 2017/18 cycle (PDF) issued in May 2018.

The FRC issued the FRED 68 Draft amendments to FRS 102: The Financial Reporting Standard applicable in the UK and Republic of Ireland Payments by subsidiaries to their charitable parents that qualify for gift aid on 20 September 2017.

It sets out proposals to amend FRS 102 to require the tax effects of a gift aid payment that it is probable will be made in the nine months following the reporting date to be taken into account at the reporting date. It also clarifies that the gift aid payment shall not be accrued at the reporting date (unless a deed of covenant is in place) and shall be recognised in equity.

The comment period closed on 20 October 2017. Finalised as Amendments to FRS 102 - Triennial review 2017 - Incremental Improvements and Clarifications in December 2017 (PDF).
 

The FRC issued FRED 67 Draft amendments to FRS 102 - Triennial review 2017 - Incremental improverments and clarifications on 23 March 2017.

The proposals in this FRED have arisen as a result of the triennial review of FRS102, and after taking into account of stakeholder feedback on the implementation of FRS 102.

The comment period closed on 30 June 2017. Finalised as Amendments to FRS 102 - Triennial review 2017 - Incremental Improvements and Clarifications in December 2017 (PDF).
 

FRED 66: Draft Amendments to FRS 101 Reduced Disclosure Framework - 2016/17 Cycle

The FRC issued FRED 66 Draft amendments to FRS 101 - 2016/17 cycle on 13 December 2016.

This FRED proposes limited amendments to FRS 101 in relation to IFRS 16 Leases.

The comment period closed on 31 March 2017.

Finalised as Amendments to FRS 101 - 2016/17 Cycle (PDF) issued in July 2017.

The FRC issued the Consultation Document Triennial review of UK and Ireland accounting standards - Approach to changes in IFRS on 27 September 2016.  It sets out initial proposals for updating FRS 102 for changes in IFRS.  When amendments to FRS 102 are proposed, they will be intended to be proportionate and practical solutions for the entities within the scope of FRS 102.

The comment period closed on 31 December 2016.

A Feedback Statement (PDF) was issued in June 2017. 

The FRC issued FRED 65 Draft amendments to FRS 101 - Notification of shareholders on 8 July 2016.

This FRED was issued after considering the responses to FRED 63 Draft amendments to FRS 101 - 2015/16 cycle.  It proposed amendments to FRS 101 to remove the requirement for a qualifying entity to notify its shareholders in writing that it intends to take advantage of the disclosure exemptions in FRS 101.  A similar, consequential, amendment was also proposed to FRS 102.

The comment period closed on 14 October 2016.

Finalised as Amendments to FRS 101 and FRS 102 - Notification of shareholders (PDF) issued in December 2016.

The FRC issued FRED 64 Draft amendments to FRS 103 - Solvency II on 11 December 2015.

This FRED proposed amendments to FRS 103 to update the terminology and definitions used for changes in the regulatory framework.  Established accounting policies can continue to be applied if an entity so chooses.

The comment period closed on 28 February 2016. FRED 64 and the responses received.

Finalised as Amendments to FRS 103 - Solvency II (PDF) issued in May 2016.

The  FRC issued FRED 63 Draft amendments to FRS 101 - 2015/16 cycle on 11 December 2015.

This FRED arises as a result of the 2015/16 annual review of FRS 101.  It proposes amendments to FRS 101 to provide certain disclosure exemptions in relation to IFRS 15 Revenue from Contracts with Customers and clarifies a legal requirement relating to the order in which the notes to the financial statements are presented.

The comment period closed on 31 March 2016.

Finalised as Amendments to FRS 101 - 2015/16 cycle (PDF) issued in July 2016.

The FRC issued FRED 62 Draft amendments to FRS 102 - Fair value hierachy disclosures on 4 November 2015.

This FRED proposes limited scope amendments to disclosures in FRS 102 that are relevant only to financial institutions and retirement benefit plans.

The comment period closed on 31 January 2016. FRED 62 and the responses received.

Finalised as Amendments to FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland – Fair value hierarchy disclosures (PDF) issued in March 2016.

On 20 April 2015, the FRC issued FRED 61 Draft Amendments to FRS 102 - Share-based payment transactions with cash alternatives. The FRC proposes in FRED 61 to amend paragraph 26.15 of FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland in order to clarify and simplify the accounting for share and share option awards with a cash-settlement alternative.

The closing date for comments is 1 June 2015.

The amendments are proposed to be effective for accounting periods beginning on or after 1 January 2015.

FRED 61 and the responses received.

Finalised as part of Amendments to FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland – Small entities and other minor amendments (PDF) issued in July 2015.

FRED 60 proposes minor amendments to FRS 100 Application of Financial Reporting Requirements and FRS 101 Reduced Disclosure Framework to withdraw the Financial Reporting Standard for Smaller Entities (effective January 2015) (FRSSE) and ensure continued compliance with changes to company law.

The most significant amendment to FRS 101 provides greater flexibility in relation to the format of the profit and loss account and balance sheet, allowing the use of IFRS-based presentation requirements similar to those used for the group accounts.

The closing date for comments is 30 April 2015.

FRED 60 and the responses

Finalised as Amendments to FRS 100 Application of Financial Reporting Requirements and part of Amendments to FRS 101 Reduced Disclosure Framework - 2014/15 cycle and other minor amendments issued in July 2015.

On 19 February 2015, the FRC issued the following suite of FREDs relating to the implementation of the EU Accounting Directive:

  • FRED 58 Draft FRS 105 The Financial Reporting Standard applicable to    the Micro-entities Regime;
  • FRED 59 Draft amendments to FRS 102 The Financial Reporting Standard  applicable in the UK and Republic of Ireland – Small entities and other  minor amendments; and
  • FRED 60 Draft amendments to FRS 100 Application of Financial Reporting Requirements and FRS 101 Reduced Disclosure Framework.

 The FREDs were issued alongside a Consultation Overview (PDF) and Consultation Stage Impact Assessment (PDF). 

FRED 59: Draft Amendments to FRS 102 - Small Entities and other Minor Amendments 

FRED 59 proposes a new section of FRS 102 developed specifically for small entities.

Section 1A proposes that small entities will apply the recognition and measurement requirements of FRS 102, but presentation and disclosure requirements based on company law, thus ensuring that all entities reporting under new UK GAAP apply a consistent framework.

In addition, other more minor amendments are required to FRS 102 to ensure continued compliance with changes to company law. The closing date for comments is 30 April 2015.

Finalised as part of Amendments to FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland – Small entities and other minor amendments (PDF) issued in July 2015.

FRED 58 sets out a proposed new standard to support the introduction of the micro-entities regime into UK company law in November 2013. At the time of writing, the micro-entities legislation is not available for application in the Republic of Ireland. However, the Irish Department of Jobs, Enterprise and Innovation (DJEI) has consulted on the possible enactment of this legislation in its Consultation on the transposition of the EU Accounting Directive. If the regime is introduced in the RoI, draft FRS 105 will be applicable.

The regime has strict qualifying criteria and is currently only available to companies.

Draft FRS 105 is based on the recognition and measurement requirements of FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland so that all new UK GAAP standards are based on a consistent framework. However, consideration has been given to the size and complexity of companies that will qualify for this regime and appropriate further simplifications have been proposed.

The closing date for comments is 30 April 2015.

FRED 58 and the responses received

Finalised as FRS 105 The Financial Reporting Standard applicable to the Micro-entities Regime (PDF) issued in July 2015.

On 15 December 2014, the FRC issued FRED 57 Draft amendments to FRS 101 Reduced Disclosure Framework (2014/15 Cycle). The 2014/15 review of FRS 101 reflects careful consideration of a number of important developments in IFRS that have occurred during the last 12 months, and proposes a small number of modest additional disclosure exemptions to FRS 101.

The closing date for comments is 20 March 2015.

The FRC expects that the amendments proposed in FRED 60 Draft amendments to FRS 100 Application of Financial Reporting Requirements and FRS 101 Reduced Disclosure Framework and those in this FRED will be finalised at the same time.

FRED 57 and the responses received.

Finalised as part of Amendments to FRS 101 Reduced Disclosure Framework - 2014/15 Cycle and other minor amendments (PDF) issued in July 2015.
 

The FRC issued FRED 56 ‘Draft FRS 104 Interim Financial Reporting’ on 12 November 2014. The comment period closed on 12 January 2015. Under the proposal the existing interim reporting guidance in the Statement Half-Yearly Financial Reporting  will be revised and replaced with Draft FRS 104 ‘Interim Financial Reporting’. It is also proposed to withdraw the Statement Preliminary Announcements.

FRED 56 and the responses received.

Finalised as FRS 104 Interim Financial Reporting (PDF) issued in March 2015.

On 1 September 2014 the FRC issued the Consultation Document Accounting standards for small entities – Implementation of the EU Accounting Directive.  The comment period closes on 30 November 2014.

Following changes that will be made to UK and Irish company law as the EU Accounting Directive is implemented, small companies may need to include less information in their financial statements and there will be fewer mandatory disclosures.  The FRC proposes a new accounting standard for micro-entities the Financial Reporting Standard for Micro-entities (FRSME).  In addition the FRC proposes to introduce a new section into FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland which will set out the requirements for small entities; the underlying accounting will be consistent with FRS 102 with presentation and disclosure requirements based on new company law.  As a consequence it is proposed that the FRSSE will be withdrawn.

The Consultation Document also contains proposals in relation to residents’ management companies and proposes amendments to FRS 101 Reduced Disclosure Framework and FRS 102 to reflect changes in company law.

The Consultation Document and responses received are available here.

After considering the feedback to the Consultation Document we have now issued FRED 58, FRED 59 and FRED 60 setting out the proposals in more detail.

On 20 August 2014 the FRC issued FRED 55 Draft Amendments to FRS 102 – Pension obligations.  The comment period closes on 21 November 2014.  These proposed amendments would clarify that:

  • UK and Irish GAAP does not include all the complexities of IFRS; no additional liabilities need be recognised in respect of a ‘schedule of contributions’ that has been agreed in order to address a deficit in the plan; and
  • consistent with current practice, the effect of restricting the recognition of a surplus in a defined benefit plan, where the surplus is not recoverable is recognised in other comprehensive income, rather than profit or loss.

FRED 55 and the responses received.

Finalised as Amendments to FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland – Pension obligations (PDF) issued in February 2015.
 

The FRC issued FRED 54: Draft Amendments to FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland – Basic financial instruments on 13 February 2014. The comment period closed on 30 April 2014.

FRED 54 and the responses received.

Finalised as part of Amendments to FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland – Basic financial instruments and Hedge accounting (PDF) issued in July 2014.

The FRC issued FRED 53 on 17 December 2013 which proposes amendments to FRS 101 Reduced Disclosure Framework resulting from recent changes to full IFRS. The comment period closed on 21 March 2014.

FRED 53 and the responses received.

Finalised as Amendments to FRS 101 Reduced Disclosure Framework (2013/14 Cycle) (PDF) issued in July 2014.

The FRC issued FRED 52 Draft Amendments to the FRSSE (April 2008) – Micro-Entities on 10 December 2013. FRED 52 proposes amendments to the FRSSE resulting in recent changes to legislation relating to micro-entities. The comment period closes on 12 February 2014.

FRED 52 and the responses received.

Finalised as Amendments to the FRSSE – Micro-entities (PDF) issued in April 2014.

The FRC issued FRED 51: Draft Amendments to FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland Hedge Accounting on 15 November 2013.  The comment period closed on 14 February 2014.

FRED 51 and the responses received.

Finalised as Amendments to FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland – Basic financial instruments and Hedge accounting (PDF) issued in July 2014.

The FRC issued FRED 50 Residential Management Companies' Financial Statements on 5 August 2013. The comment period closed on 11 November 2013. Most Residential Management Companies will be small companies, the accounting requirements will need to comply with the new EU Accounting Directive. Therefore, we propose to take this project forward as part of our review of the FRSSE and the requirements for small companies more generally (see below).

FRED 50 and the responses received.

Finalised as part of Amendments to FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland – Small entities and other minor amendments (PDF) issued in July 2015.

The FRC issued FRED 49: Draft FRS 103 Insurance Contracts on 29 July 2013.  The comment period closed on 31 October 2013.

FRED 49, the accompanying draft Implementation Guidance and the responses received.

Finalised as FRS 103 Insurance Contracts (PDF) issued in March 2014.