Interpretation and Application of UK GAAP: For Accounting Periods Commencing On or After 1 January 2015

Chapter 31First-Time Adoption of FRS 102

1. Introduction
2. Identifying the Date of Transition
3. Accounting Policy Alignments
4. Statement of Compliance
5. Disclosure Requirements

Introduction

FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland becomes mandatory for accounting periods commencing on or after 1 January 2015. The importance of a thorough programme of planning for the transition across to the new UK GAAP cannot be over-emphasised. Practitioners and company accountants should be considering transitional issues as a matter of priority. The rules in FRS 102 are retrospective in that they must be applied to the comparative period financial statements so that comparability and consistency in financial reporting are achieved. Readers are also encouraged to review Chapter 5 of this book to familiarise themselves with the key differences between the ‘old’ UK GAAP and FRS 102.

Section 35 Transition to this FRS is the vital section that first-time adopters of FRS 102 will need to understand. The section applies to first-time adopters of FRS 102 regardless of the previous accounting framework that was applied in the preparation of financial statements (for example, the old UK GAAP or EU-endorsed IFRS).

First-time adoption can only occur once. This is because, whilst Section 35 may look familiar with the provisions contained in Section 10 Accounting Policies, Estimates and Errors, Section 35 contains some special exemptions, simplifications and other ...