FRC extends COVID-19 lease accounting relief

UK regulator the Financial Reporting Council (FRC) issued Wednesday amendments to two UK and Ireland standards — FRS 102 and FRS 105.

The amendments are:

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 Beyond 30 June 2021.

They extend by one year the application of requirements covering accounting for temporary rent concessions occurring as a direct consequence of the COVID-19 pandemic.

The requirements, originally introduced into FRS 102 and FRS 105 in October 2020, apply to rent concessions that “reduce only lease payments originally due on or before 30 June 2022, provided the other conditions for applying the requirements are met”, the FRC explained.

The amendments are effective for accounting periods beginning on or after 1 January 2021, with early application permitted.

The FRC also issued an Impact Assessment and Feedback Statement.

— Oliver Rowe (Oliver.Rowe@aicpa-cima.com) is an FM magazine senior editor.