News July 2016 FRC concludes annual review of FRS 101 and proposes further changes in response to feedback

FRC concludes annual review of FRS 101 and proposes further changes in response to feedback

08 July 2016

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Following the conclusion of the latest annual review of FRS 101 Reduced Disclosure Framework the Financial Reporting Council (FRC) has today issued Amendments to FRS 101 – 2015/16 cycle and FRED 65 Draft amendments to FRS 101 – Notification of shareholders.

The amendments to FRS 101 are limited, and predominately provide exemptions from many of the disclosure requirements of IFRS 15 Revenue from Contracts with Customers.

FRS 101 is an optional standard that allows entities within groups to prepare financial statements in accordance with IFRS, but with reduced disclosures.  As part of the consultation on these amendments stakeholders took the opportunity to provide feedback on the requirement to notify shareholders before applying the disclosure exemptions in FRS 101.  Respondents felt the cost-effectiveness of this requirement could be improved, as well as the guidance provided to ensure consistent application. This feedback has led the FRC to propose in FRED 65, which is out for public consultation today, that notification is no longer required.

Paul George, Executive Director, Corporate Governance and Reporting said:

“In issuing these amendments we are aiming to ensure that FRS 101 remains a cost‑effective option for listed groups, by providing additional disclosure exemptions as IFRS changes.  In addition, FRED 65 responds to feedback by consulting on eliminating an administrative burden.”

Responses to FRED 65 should be provided to ukfrs@frc.org.uk by 14 October 2016. The FRC aims to finalise the amendments in December 2016, and proposes that they should apply to accounting periods beginning on or after 1 January 2016.

Amendments to FRS 101: Reduced Disclosure Framework 2015/16 cycle (PDF)

Impact Assessment and Feedback Statement: Amendments to FRS 101 Reduced Disclosure Framework 2015/16 (PDF)

FRED 65: Draft Amendments to FRS 101 Reduced Disclosure Framework - Notification of Shareholders (PDF)

Notes to editors:

1.         The FRC is responsible for promoting high quality corporate governance and reporting to foster investment.  We are the UK competent authority for audit and 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 enforcement arrangements for accountants and actuaries; and oversee the regulatory activities of the accountancy and actuarial professional bodies.

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