News April 2015 FRC consults on limited amendments to FRS 102

FRC consults on limited amendments to FRS 102

20 April 2015

PN 23/15

The Financial Reporting Council (FRC) has today issued an Exposure Draft, FRED 61 Draft Amendments to FRS 102 - Share-based payment transactions with cash alternatives which proposes clarifying and simplifying the accounting for share and share option awards where a cash-settlement alternative exists. Entities would generally be able to continue with their existing accounting practices applied under previous UK and Irish GAAP which should reduce transition and application costs of FRS 102.

Melanie McLaren, Executive Director of Codes and Standards said:

“Stakeholders recently informed us of unintended consequences when entities apply FRS 102 to certain types of share option arrangements. This proposal addresses these issues and aligns FRS 102 more closely with IFRS.”

The amendments are proposed to be effective for accounting periods beginning on or after 1 January 2015. The comment period on this proposal closes on 1 June 2015.

Notes to editors:

  1. The FRC is responsible for promoting high quality corporate governance and reporting to foster investment.  We set the UK Corporate Governance and Stewardship Codes as well as UK standards for accounting, auditing and actuarial work.  We represent UK interests in international standard-setting.  We also monitor and take action to promote the quality of corporate reporting and auditing.  We operate independent disciplinary arrangements for accountants and actuaries; and oversee the regulatory activities of the accountancy and actuarial professional bodies.
  2. With effect from 1 January 2015 the FRC revised financial reporting standards in the United Kingdom and Republic of Ireland. The revisions fundamentally reformed financial reporting, replacing the extant standards with five Financial Reporting Standards FRS 100 ‘Application of Financial Reporting Requirements’; FRS 101 ‘Reduced Disclosure Framework’; FRS 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland’; FRS 103 ‘Insurance Contracts’; and FRS 104 ‘Interim Financial Reporting’.