Cutting through UK GAAP - KPMG

334 Pages·2015·1.39 MB·English

Cutting
through
UK GAAP
KPMG’s guide to the new
fnancial reporting regime
Second edition
kpmg.com/uk
2 Cutting through UK GAAP
Foreword
eN w UK GAAP is now in forec , appliac ble for periods beginning or after 1 aJ nau ry 2015 ; we are now within the frst period of
mandatory appliac tion.
eN w UK GAAP replaec s the previosu , longs- tanding UK aoc nu ting standards and oc mprises a mlu tipliic ty of separate
aoc nu ting frameworks, all of whihc are part of eN w UK GAAP. Mhcu of their effetc will be oc mfortable and familiar, btu there
is also mhcu hc ange.
nE tities that were previosu ly reiuq red to apply UE I- SRF by appliac ble law and reglu ation oc ntineu to do so. tO her entities
are able, sbu ej tc to eligibility, to hc oose to prepare their fnanic al statements in aoc rdanec with UE I- SRF , SRF 101, SRF 102
(inlc du ing, when relevant, SRF 10)3 , the SRF S E (replaec d for periods beginning on or after 1 aJ nau ry 201 6 by SRF 102 with a
different dislc osru e regime for small entities), or the mirc oe- ntities standard (SRF 105). oF r sbu sidiaries of entities preparing
UE I- SRF oc nsolidated fnanic al statements, the appliac tion of SRF 101 in partiluc ar allows the su e of aoc nu ting poliic es that
are more oc nsistent with those of the gropu , withotu the perec ived bru den of applying the flu l dislc osru e reiuq rements of UE -
ISRF . Gropu s ac n eletc for some of their sbu sidiaries to apply SRF 101 and others SRF 102, sinec both will be C` ompanies Atc
aoc nu ts.’
If they have not already done so, those hc arged with governanec will need to make important deic sions abotu whihc
aoc nu ting framework to apply. hT is will reiuq re not only oc nsideration of the available aoc nu ting options, btu also
assessment of the potential effetc on aoc nu ting systems, staff training, taax tion and other arrangements shcu as loan
oc venants. hT ey will also need to oc nsider the potential effetc on distribtu able profts. In this pbu liac tion, we smu marise the
reiuq rements of eahc of the new standards SRF s 100, 101, and 102. In addition, we highlight the key aoc nu ting differenec s
between SRF 102, previosu UK GAAP and UE I- SRF , in order to inform those deic ding whihc standards to apply and to ease the
transition to SRF 102 for those that hc oose to apply that standard. eW do not dissuc s the reiuq rements of SRF 10 3 Insurance
Contracts in any detail btu do oc nsider its soc pe and prinic pal differenec s from previosu UK GAAP and UE I- SRF .
In this, the seoc nd edition of this pbu liac tion, we have inlc du ed eax mples to illsu trate the appliac tion of the reiuq rements
of SRF 102, as well as oru interpretation of those reiuq rements in a nmu ber of areas in whihc the standard is not epx liic t,
neec ssitating duj gement to apply them appropriately. As SRF 102 is a new fnanic al reporting framework, oc mmon pratc iec
and interpretation oc ntineu to evolve and we will pu date ftu ru e editions of this pbu liac tion to ree� tc that body of epx erienec as
it develops, whihc may be ineu� nec d both by past UK GAAP pratc iec and evolving ISRF appliac tion.
A new GAAP, appliac ble to tens of thosu ands of entities all at onec , is an eicx ting and hc allenging prospetc . 2015 will be a
year of both hc oiec and rekc oning for many as they navigate those hc anges. eW trsu t that this pbu liac tion will assist yo u in
nu derstanding those hc oiec s and we look forward to helping yo u to rise to the hc allenge.
oT ny Cates
eH ad of Adu it, KPMG in the UK
© 2015 KPMG LLP, a UK limited liability partnership and a member frm of the KPMG network of independent member frms affliated with KPMG International Cooperative (“KPMG International”), a
Swiss entity. All rights reserved. Printed in the United Kingdom.
Contents 3
Contents
About this publication ................................................................................................................ 5
Acknowledgements................................................................................................................... 5
Other ways KPMG professionals can help ................................................................................. 5
Abbreviations ............................................................................................................................ 6
Introduction ............................................................................................................................... 7
01Application of fnancial reporting requirements ..................................................................... 8
02 Reduced disclosure framework .......................................................................................... 18
03 Scope, concepts, principles and presentation .................................................................... 22
04 Statement of fnancial position (Balance sheet) .................................................................. 32
05 Statement of comprehensive income and income statement ............................................ 36
06 Statement of changes in equity and statement of income and retained earnings ............... 44
07 Statement of cash fows ..................................................................................................... 48
08 Notes to the fnancial statements ....................................................................................... 54
09 Consolidated and separate fnancial statements ................................................................ 58
10 Accounting policies, estimates and errors ........................................................................... 70
11 Basic fnancial instruments ...................................................................................................74
12 Other fnancial instruments ................................................................................................. 94
13 Inventories .........................................................................................................................112
14 Associates .........................................................................................................................118
15 Joint ventures ................................................................................................................... 126
16 Investment property ......................................................................................................... 132
17 Property, plant and equipment .......................................................................................... 136
18 Intangible assets other than goodwill ................................................................................ 144
19 Business combinations and goodwill ................................................................................ 150
20 Leases .............................................................................................................................. 158
21 Provisions and contingencies ........................................................................................... 166
22 Liabilities and equity ......................................................................................................... 180
23 Revenue ........................................................................................................................... 192
24 Government grants ........................................................................................................... 202
25 Borrowing costs ............................................................................................................... 206
26 Share-based payment ....................................................................................................... 212
© 2015 KPMG LLP, a UK limited liability partnership and a member frm of the KPMG network of independent member frms affliated with KPMG International Cooperative (“KPMG International”), a
Swiss entity. All rights reserved. Printed in the United Kingdom.
4 Cutting through UK GAAP
2 7 Impairment of assets ....................................................................................................... 220
2 8 mE ployee benefts ............................................................................................................ 203
2 9 Inoc me ta x........................................................................................................................ 224
03 oF reign ruc renyc translation ............................................................................................. 252
13 yH perina� tion ....................................................................................................................206
23 vE ents after the end of the reporting period ..................................................................... 26
3 eR lated party dislc osru es ................................................................................................. 207
43 Speic alised atc ivities ........................................................................................................ 287
53 r T ansition to SRF 102 ......................................................................................................... 03 8
63 Insru anec oc ntratc s .......................................................................................................... 13 6
Appendi x I : List of standards and interpretations referred to in this pbu liac tion ..................... 23 2
Appendi x II : Common proft and loss aoc nu t and
balanec sheet formats from Shc edlu es 1 and 6 to the eR glu ations ....................................... 23 8
© 2015 KPMG LLP, a UK limited liability partnership and a member frm of the KPMG network of independent member frms affliated with KPMG International Cooperative (“KPMG International”), a
Swiss entity. All rights reserved. Printed in the United Kingdom.
About this publication 5
Abotu this pbu liac tion
This publication summarises and discusses the requirements of FRS 100, FRS 101 and FRS 102 and notes the main
differences between FRS 102, previous UK GAAP and EU-IFRS. It does not consider either the micro-entities standard (FRS
105) or the FRSSE (or its replacement, new Section 1A Small Entities of FRS 102). It also does not discuss the disclosure
requirements of FRS 102 in any detail. It includes consideration of the scope of FRS 103 and the principal differences from EU-
IFRS and previous UK GAAP.
Although it includes an overview of the requirements of FRSs 100 to102, this publication is an interpretative guide to those
FRSs that builds on the standards and should be read alongside them.
When the standards are silent on a particular matter, we discuss different acceptable accounting treatments. We use the
phrase ‘in our view’ if we believe that only one accounting treatment is appropriate.
The publication is organised into chapters that generally correspond to the relevant section of FRS 102 (Chapters 3 to 35).
Chapters 1 and 2 consider FRS 100 and FRS 101 respectively; Chapter 36 considers FRS 103.
This publication includes the following paragraph/section references:
• x.x (e.g. 3.1) – paragraph of the main body in this publication
• pUKx.x (e.g. pUK3.1) – paragraph of comparison to previous UK GAAP in this publication
• IFRSx.x (e.g. IFRS3.1) – paragraph of comparison to EU-IFRS in this publication
• FRS10x.x.x (e.g. FRS102.3.1) – paragraph of the relevant standard
• FRS10x.ACA.xx (e.g. FRS102.ACA.92) – paragraph of Accounting Council’s Advice on the relevant standard
• FRS10x.GL – glossary of the relevant standard
• FRC CS ddmmyy – FRC clarifcation statement and relevant date of issue
• FRC SENxx - FRC staff education note and number
• Chapter x (e.g. Chapter 3 Scope, concepts, principles and presentation) – chapter in this publication
• Section x (e.g. Section 3 Financial statement presentation) – section of the standard FRS 102
Akc nowledgements
We gratefully acknowledge our technical team in the Department of Professional Practice of KPMG in the UK (UK DPP) as
primary authors of this book. The project has been led by Lynn Pearcy, Steve Hubbard, Karen Duncan and Gina Desai.
tO her ways KPMG professionals ac n help
This publication has been produced by UK DPP. There is a range of publications and guidance published by UK DPP and KPMG
IFRG Limited that is available to assist you further, including:
• Illustrative fnancial statements prepared under each of FRS 101 and FRS 102
• Insights into IFRS – provides practical guidance on the application of IFRS
• IFRS Handbooks – include extensive interpretative guidance and illustrative examples to elaborate on or clarify the
practical application of IFRS
• e-learning modules on FRSs 100-102 from the KPMG Learning Academy.
For access to an extensive range of accounting, auditing and fnancial reporting guidance and literature, visit KPMG’s
Accounting Research Online. This web-based subscription service can be a valuable tool for anyone who wants to stay
informed in today’s dynamic environment. For a free 15-day trial, go to www.aro.kpmg.com and register today.
For further information see kpmg.com/uk or kpmg.com/ifrs.
© 2015 KPMG LLP, a UK limited liability partnership and a member frm of the KPMG network of independent member frms affliated with KPMG International Cooperative (“KPMG International”), a
Swiss entity. All rights reserved. Printed in the United Kingdom.
6 Cutting through UK GAAP
Abbreviations
‘Companies Act’ – Companies Act 2006
‘EU-IFRS’ – International Financial Reporting Standards as adopted by the European Union
‘FRC’ – Financial Reporting Council, the UK regulator that issues UK accounting standards
‘FRS’ – Financial Reporting Standard
‘FRSSE’ – Financial Reporting Standard for Smaller Entities
‘GAAP’ – Generally Accepted Accounting Practice/Principles
‘IAS’ – International Accounting Standard
‘IFRIC’ – IFRS Interpretations Committee (previously the International Financial Reporting Interpretations Committee)
‘IFRS’ – International Financial Reporting Standard
‘Insights into IFRS’ – KPMG’s Insights into IFRS publication
‘LLP’ – Limited Liability Partnership
‘LLP Regulations’ – Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008,
Statutory Instrument 2008/1911
‘Regulations’ – The Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations, Statutory
Instrument 2008/410
‘SIC’ – Standing Interpretations Committee
‘SORP’ – Statement of Recommended Practice
‘SSAP’ – Statement of Standard Accounting Practice
‘UITF’ – Urgent Issues Task Force
‘UK GAAP’ – United Kingdom Generally Accepted Accounting Practice
© 2015 KPMG LLP, a UK limited liability partnership and a member frm of the KPMG network of independent member frms affliated with KPMG International Cooperative (“KPMG International”), a
Swiss entity. All rights reserved. Printed in the United Kingdom.
Intruduction 7
Introdtcu ion
INT.1 The fnancial reporting standards for the UK and Republic of Ireland have been revised for periods beginning on or after 1 January
2015. All of the standards in previous UK GAAP either have been or, in the case of the FRSSE, will be replaced by four standards:
• FRS 100 Application of Financial Reporting Requirements (as updated July 2015)
• FRS 101 Reduced Disclosure Framework (as updated August 2014 and July 2015)
• FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (as updated August 2014, February
2015 and July 2015)
• FRS 103 Insurance Contracts
INT.2 These FRSs bring UK GAAP up to date and increase consistency with International Financial Reporting Standards.
INT.3 FRS 100 sets out the fnancial reporting requirements for UK and Ireland entities preparing fnancial statements that are
intended to give a true and fair view. See Chapter 1 of this publication.
INT.4 FRS 101 sets out a reduced disclosure framework that may be applied in the individual fnancial statements of qualifying
group entities that otherwise apply the requirements of EU-IFRS. See Chapter 2 of this publication.
INT.5 FRS 102 is a single standard providing concise fnancial reporting requirements, based on the International Financial
Reporting Standard for Small and Medium-sized Entities (IFRS for SMEs) as amended for use in the UK and Ireland. It replaces
the previous body of UK GAAP accounting standards. See Chapters 3 to 35 of this publication.
INT.6 In July 2015 the FRC issued amendments to FRSs 100 to 102, the majority of which are effective for periods
commencing on or after 1 January 2016, although some are effective for periods commencing on or after 1 January 2015. The
key amendments are discussed in the relevant chapters of this publication as follows:
• Changes that are effective from 1 January 2016 are either discussed in the main chapter text or included as footnotes to
the currently effective requirements.
• Changes that are effective from 1 January 2015 are discussed in the main chapter text.
INT.7 Early-adoption of the July 2015 amendments, and the new requirements for sma ll and micro-entities (see paragraph INT.11
below), is permitted for periods commencing on or after 1 January 2015, provided that (for companies) the corresponding changes to
the Companies Act as a result of changes in the EU Accounting Directive (see SI 2015/980) are also early-adopted. Similarly,
early-adoption of the amendments is required if a company chooses to early-adopt the changes to the Companies Act.
INT.8 FRS 103 replaces FRS 27 and the SORP Accounting for Insurance Business. The scope of this standard is not restricted
to insurance entities; it applies to any entity applying FRS 102 with any of the following:
• insurance contracts (including reinsurance contracts) issued;
• reinsurance contracts held by the entity;
• fnancial instruments with a discretionary participation feature issued by the entity. [FRS102.1.6]
INT.9 FRS 104 Interim Financial Reporting sets out requirements for interim fnancial reports prepared by FRS 101 and FRS 102
adopters. FRS 104 is not addressed in this publication.
INT.10 The FRSSE may be applied by entities meeting the small companies’ exemptions of the Companies Act, or entities that
are not companies but would otherwise be entitled to those exemptions if they had been incorporated under the Companies Act.
INT.11 The FRSSE is withdrawn for periods beginning on or after 1 January 2016, and replaced by:
• For micro-entities: a new standard, FRS 105 The Financial Reporting Standard applicable to the Micro-entities Regime;
• For small entities that are not micros: new Section 1A Small Entities of FRS 102. This requires small entities to apply the
recognition and measurement requirements of FRS 102 but with a different disclosure regime, refecting the fact that the
EU Accounting Directive limits the number of specifc disclosures that may be mandated for small entities. The fnancial
statements of small entities are nevertheless still required to give a true and fair view, which may require judgement to be
exercised over the appropriate level of disclosure.
INT.12 The detailed requirements of Section 1A of FRS 102 and FRS 105 are not addressed in this publication.
© 2015 KPMG LLP, a UK limited liability partnership and a member frm of the KPMG network of independent member frms affliated with KPMG International Cooperative (“KPMG International”), a
Swiss entity. All rights reserved. Printed in the United Kingdom.
8 Cutting through UK GAAP
Appliac tion of fnanic al
01 reporting reiuq rements
IVREV O WE FO UQER IMER STNE
n Depending on eligibility and legal and regulatory requirements, UK and Ireland private sector entities apply
EU-IFRS, FRS 101 or FRS 102 (with or without reduced disclosures and including, when relevant, FRS 103),
the FRSSE or, for periods beginning on or after 1 January 2016, its replacement for small entities, Section
1A of FRS 102 or FRS 105 in preparing their annual fnancial statements.
n An entity applying FRS 102 also applies a SORP if required or relevant.
n An entity states the framework it is applying in the notes to its fnancial statements.
n FRSs 100, 101 and 102 are applicable for periods beginning on or after 1 January 2015. Early-adoption is
permitted subject to certain conditions.
n FRS 102 with a different disclosure regime for small entities and FRS 105 (the micro-entities standard)
replace the FRSSE for periods beginning on or after 1 January 2016. Early-adoption is permitted for periods
beginning on or after 1 January 2015 subject to early-adoption also of the related legal changes (see
paragraph INT.7 of this publication).
n Transitional requirements are as specifed in FRS 100, FRS 101 and FRS 102.
n Qualifying entities within a group may apply a reduced disclosure framework in their individual fnancial
statements under FRS 101 or FRS 102.
n Guidance on ‘equivalence’ is given in the Application Guidance to FRS 100.
n FRS 104 sets out requirements for interim fnancial reports prepared by FRS 101 and FRS 102 adopters. FRS
104 is not addressed in this publication.
© 2015 KPMG LLP, a UK limited liability partnership and a member frm of the KPMG network of independent member frms affliated with KPMG International Cooperative (“KPMG International”), a
Swiss entity. All rights reserved. Printed in the United Kingdom.
01 – Application of fnancial reporting requirements 9
1.1 SRF 100 sets otu the fnanic al reporting reiuq rements for UK and Ireland entities preparing fnanic al statements that are
intended to give a treu and fair view. SRF[ 100.2 ] It does not, however, apply to the fnanic al statements of entities within the
1 2
pbu li c setc or , whose fnanic al reporting framework is determined by the eR levant Atu horities and is generally based on UE -
ISRF as adapted for su e in the pbu li c setc or (see the oF reword to Aoc nu ting Standards paragraph 21).
1.2 Annau l fnanic al statements within the soc pe of SRF 100 are prepared, depending on eligibility, in aoc rdanec with either
3
UE I- SRF , SRF 101, SRF 102, or the SRF SE . SRF[ 100.]4
1. 3 UE I- SRF is applied when reiuq red by law or reglu ation (for eax mple, in the oc nsolidated fnanic al statements of oc mpanies
listed on an UE r- eglu ated market or AIM oc mpanies).
1. 4 SRF 101 sets otu a redecu d dislc osru e framework that may be applied in the individau l fnanic al statements of auq lifying
gropu entities (see paragraph 1.2 4 of this pbu liac tion) that otherwise apply the reiuq rements of UE I- SRF . hT is framework is
dissuc sed fru ther in Chapter 2 of this pbu liac tion.
1.5 SRF 102 (inlc du ing, when relevant, SRF 10)3 replaec s the previosu body of UK GAAP standards and is dissuc sed in
Chapters 3 to 53 of this pbu liac tion (see Chapter 63 for a dissuc sion of SRF 10)3 . It also inlc du es dislc osru e eex mptions for
auq lifying gropu entities.
Basis of preparation of fnancial statements
1. 6hT e appliac ble standards are smu marised in the following table. Any entity ac n t‘ rade pu ’ and apply a h‘ igher ’ standard (e.g.,
an entity ruc rently eligible to apply the SRF S E may hc oose instead to apply SRF 102).
Accounting regime Applicable to Example Further guidance
UE I- SRF • hT ose reiuq red to apply by • Gropu fnanic al statements of KPMGs’ Insights into IFRS
law or reglu ation UE listed and AIM entities
• pO tional for others • Large private gropu or oc mpany
4
SRF 101 • Individau l fnanic al • Parent oc mpany in a listed or Chapter 2 of this
statements of auq lifying private gropu pbu liac tion ; see also
parent and sbu sidiary entities paragraphs 1.21-4 .53 for
• Sbu sidiaries in a listed or private
eligibility
gropu
,4 5
SRF 102 • Individau l and gropu fnanic al • Large and medimu private Chapters 3 to 63 of this
statements of large and oc mpanies and gropu s pbu liac tion
medimu s- iez d entities
• Parent oc mpany in a listed or
• Individau l and gropu fnanic al private gropu
statements of small entities
• Sbu sidiaries in a listed or private
hc oosing not to apply SRF SE
gropu
,4 5
SRF 102 with • Individau l fnanic al • Parent oc mpany in a listed or Chapters 3 to 63 of this
redecu d dislc osru es statements of auq lifying private gropu pbu liac tion ; see also
parent and sbu sidiary entities paragraphs 1.21-4 .53 for
• Sbu sidiaries in a listed or private
eligibility
gropu
3
SRF SE • lE igible small entities • Small private oc mpanies See I.TN 10 for eligibility
• Small nonoc- mpany entities
1. hT e pbu li c setc or inlc du es those entities lc assifed as shcu by the fO fec for mirc oe- ntities, SRF 102 with a different dislc osru e regime for small entities
aN tional Statistisc . (Setc ion 1A of SRF 102). aE rlya- doption is permitted for periods beginning on or
after 1 aJ nau ry 2015, sbu ej tc to earlya- doption also of the related legal hc anges
2. hT e eR levant Atu horities in the UK are : MH r T easru y, the eW lsh Assembly
(see paragraph I.TN 7 of this pbu liac tion).
Government, the Soc ttish Government, the oN rthern Ireland Assembly, CIPAF /
LASAAC, the eD partment of eH alth and Monitor (Independent eR glu ator for .4 SRF 10 4 sets otu reiuq rements for interim fnanic al reports prepared by SRF 101
SHN oF nu dationr T su ts). and SRF 102 adopters. SRF 10 4 is not addressed in this pbu liac tion.
.3 In luJ y 2015, the CRF withdrew the SRF S E for periods beginning on or after 1 5. Inlc du ing, when relevant, SRF 10.3
aJ nau ry 201 6 and replaec d it with SRF 105 and, for small entities that are not
© 2015 KPMG LLP, a UK limited liability partnership and a member frm of the KPMG network of independent member frms affliated with KPMG International Cooperative (“KPMG International”), a
Swiss entity. All rights reserved. Printed in the United Kingdom.
10 Cutting through UK GAAP
Interatc ion with Companies Atc reiuq rements
1.7 Financial statements of a company prepared in accordance with FRS 101, FRS 102 (with or without reduced disclosures)
or the FRSSE (or its replacements) are ‘Companies Act accounts’ as defned by section 395 of the Companies Act. Only those
prepared under EU-IFRS are ‘IAS accounts’.
1.8 The Companies Act specifes that charitable companies prepare ‘Companies Act accounts’ so they are not eligible to apply
EU-IFRS in their individual or group fnancial statements. They are also not eligible to apply FRS 101 as the defnition of a
qualifying entity under that standard excludes charitable companies.
1.9 Section 407 of the Companies Act requires the individual fnancial statements of UK subsidiary companies within a group,
when the parent prepares consolidated fnancial statements, to be prepared on a consistent basis (i.e. all Companies Act
6
accounts or IAS accounts) unless there are good reasons not to . The individual fnancial statements of the parent company are
prepared on the same basis as those of the subsidiaries except when the parent company prepares IAS group accounts and
IAS individual accounts. As only individual fnancial statements prepared under EU-IFRS are considered to be IAS accounts, it is
possible for different subsidiaries within a group to apply FRS 101 and FRS 102 (and, if eligible, the FRSSE or its replacements)
in their individual fnancial statements without breaching the Companies Act consistency requirement.
1.10 Previously, once a company had prepared its consolidated or individual fnancial statements under EU-IFRS, it could not
revert to UK GAAP in a later fnancial year unless there was a specifed ‘relevant change in circumstances’ (e.g. if the company
7
(or its parent) ceased to have its securities admitted to trading on a regulated market in an EEA state [Companies Act sections
395 and 403]). Changes to the Companies Act (for periods ending on or after 1 October 2012) introduced a free choice for a
company to revert to UK GAAP (which includes FRS 101 and FRS 102) from EU-IFRS as long as it has not in the last fve years
previously reverted to UK GAAP (other than as a result of a relevant change in circumstances).
1.11 Certain requirements of the Companies Act apply even when the fnancial statements are prepared in accordance with
EU-IFRS. This includes disclosures in relation to related undertakings and directors’ benefts, and the requirement to prepare a
strategic report, a directors’ report and (if applicable) a directors’ remuneration report. [FRS100.A2.18-19]
oN noc- mpanies
1.12 Many entities applying FRS 100 are not companies and will need to consider whether there are any conficts with the
legislation or regulation applicable to them. [FRS100.A2.20] The FRC has considered the legislation for the form and content of
fnancial statements for the following and has concluded that there are no signifcant areas of confict with FRS 102:
• Building Societies Act 1986;
• Charities Act 2011;
• Charities and Trustee Investments Act (Scotland) 2005;
• Charities Act (Northern Ireland) 2008;
• Friendly and Industrial and Provident Societies Act 1968 (superseded by the Co-Operative and Community Beneft Societies
Act 2014 with effect from 1 August 2014);
• Friendly Societies Act 1992; and
• The Occupational Pension Schemes (Requirement to obtain Audited Accounts and a Statement from the Auditor)
Regulations 1996.
1.13 Certain entities may be required to comply with additional regulations on top of the legal requirements and accounting
standards, and some fall within the scope of SORPs, which have been updated to refect the requirements of FRS 102.
[FRS100.A2.21]
6. Charitable companies are not permitted to prepare IAS accounts and are not required to apply the same fnancial reporting framework as non-charitable subsidiaries.
7. The European Economic Area (EEA) comprises the countries of the European Union (EU), plus Iceland, Liechtenstein and Norway. It does not include the Channel
Islands, the Isle of Man, or Gibraltar.
© 2015 KPMG LLP, a UK limited liability partnership and a member frm of the KPMG network of independent member frms affliated with KPMG International Cooperative (“KPMG International”), a
Swiss entity. All rights reserved. Printed in the United Kingdom.