FRS 102/105 transition

TreadStone AAT Licensed Accountant Posts: 280 💫 🐯 💫
Most of our company clients are micro or small. The first sets of mandatory accounts (y/e 31/12/16) under the new FRS 102/105 are currently being put together/completed.

Who is finding they are requiring a fair amount of adjustments to make them compliant ?
Who's not making any transitional adjustments ?
Who's just unsure and doesn't really grasp what (if any) adjustments need to be made and/or what to look for ?
Who doesn't really have a clue and is pretty much just preparing the accounts in the same fashion as the previous year ?

Be truthful now.... :)


  • burg
    burg Moderator, FMAAT, AAT Licensed Accountant Posts: 1,441
    To be honest from what I have read (this seems a good summary fropm Steve - most of the changes have little affect on the majority of our clients.
    Although I made a decision a while back to start producing Micro Entity accounts where possible I soon came accross an issue in that lenders did not like them. The P&L is rubbish and dividends are not disclosed anywhere. We therefore dropped them as it just made more work when we did need to make them a full set later on for lending purposes. This will be the same under FRS105. Therefore we will not be looking at FRS105 as it will have no advantage.
    We are yet to prepare a set under FRS102 but I would be interested to hear from those who have and also anyone who really thinks it will make a big difference.

  • Bertie
    Bertie Registered Posts: 376
    105 is not fit for purpose. FRS 102 spans all of 380 pages.

    I don't think there is much complexity in making the transition to FRS 102 1A.

    Hopefully everyone who has small Ltd companies within their business should be able to re-state a TB to a FRS 102 compliant comparative.

    There are some very good resources online. PwC do have literature which can be bought for circa £100 which contains the full standards (102/105) with full worked examples.

    Or the full standard (102) can be bought for £30.

    SWAT hold regular CPD courses, these aren't cheap, as you can imagine.

    As mentioned by @Burg banks are not, and will not be a fan of 105 drawn up accounts as they do not hold enough information.

    If a director was to draw up their own accounts I would envisage them to use 105 due to it's simplicity. An accountant, acting on behalf of the same said client, should in my opinion be drawing up FRS 102 accounts to provide the best possible picture of the company.

    Having said that of course the ultimate decision lays with the director of the company, but almost all would not have a clue of the difference between the two standards.

    Much is opinion of course, and just because a company is eligible to use FRS 105 does not mean it should be used.

    As for do I think it will make any difference?

    I don't believe so, not if FRS 102 is used. Once the initial transition period has been taken care of the standard is pretty tight and tidy.

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