FRC proposes UK and Ireland accounting standards amendmentsThe UK regulator has set out amendments relating to going concern and COVID-19-related rent concessions.
UK regulator the Financial Reporting Council (FRC) on Thursday issued two exposure drafts that propose amendments to UK and Ireland accounting standards:
- Financial Reporting Exposure Draft (FRED) 75, Draft Amendments to FRS 104, Interim Financial Reporting: Going Concern.
These amendments are to clarify the requirement to assess the going concern basis of accounting; and require the disclosure of any related material uncertainties when preparing interim financial statements in accordance with Financial Reporting Standard (FRS) 104, Interim Financial Reporting.
- FRED 76, Draft Amendments to FRS 102, The Financial Reporting Standard Applicable in the UK and Republic of Ireland, and FRS 105, The Financial Reporting Standard Applicable to the Micro-Entities Regime: COVID-19-Related Rent Concessions.
These amendments propose “explicit requirements for accounting for temporary rent concessions for operating leases occurring as a direct consequence of the COVID-19 pandemic, and within a limited timeframe”, the FRC said.
Deadlines for comments
Both comment periods end on 1 September 2020. The proposals in FRED 75 are expected to apply to interim periods beginning on or after 1 January 2021, and the proposals in FRED 76 are expected to apply to accounting periods beginning on or after 1 January 2020. In both cases early application will be permitted.
— Oliver Rowe (Oliver.Rowe@aicpa-cima.com) is an FM magazine senior editor.