Newswire February 2025

Mercia Group
26 February 2025 10:00

Welcome to our February Newswire.

The daffodils are at last starting to rise, signalling that Spring is just around the corner, bringing rejuvenation and renewal.

On the theme of rejuvenation, the Financial Reporting Council (FRC) has launched a study as part of a campaign to support UK small and medium-sized enterprises (SMEs) to grow. This important study will influence the future of SME audits. So, if you’re an audit firm working with SMEs, we encourage you to take part. You can read more here and get involved by sharing your views directly with the FRC or contribute to Mercia’s response by contacting our Head of Audit, Accounting and Compliance, Jenny Faulkner, directly.

Whilst speculation continues to build over what Chancellor Rachel Reeves will announce at the Spring Statement, Pat Nown reminds you not to miss opportunities for tax planning before the end of the 24/25 tax year in her blog ‘the decline of domicile and rise of residence’.

We’re also excited to show you our new interactive on-demand library, a comprehensive resource for all key areas of the UK GAAP standards. Whether you're updating your knowledge or exploring in greater detail, this library provides the tools for you.

In February’s Newswire, we look at HMRC’s latest guidance for firms making R&D claims and the independent review into the Loan Charge announced by the government - please see the tax section for details. On the audit side, we examine UKEB’s 2025 IFRS Standards and the FRC's thematic review of Climate-related Financial Disclosures (CFD) by AIM and large private companies.

Will Chancellor Rachel Reeves cash out at the Spring Statement?

Government figures have paved the way for frustration at the subpar performance of the cash ISA while successive administrations have made it clear they want to see more savers fuelling British businesses with their nest eggs. Our latest blog post looks at the cases for and against making changes to the ISA regulations.

Bite sized courses

We are introducing new interactive audit and accounts modules featuring information checks throughout to enhance learning.

We've just launched 10 brand-new modules, including hot topics like Leases and Revenue, with fresh content added every month.

View recent additions

Charities Conference

6 March 2025 (09:30 - 17:00)

The charity sector is constantly evolving, and with a new Charities SORP coming later this year, it is essential for accountants, auditors, and independent examiners to stay informed.

Join our live conference this March to receive key updates from the Charity Commission, insights on employment law, VAT, charity accounts, lessons from regulatory casework and much more.

Book your place today

UK GAAP Libary

We’re thrilled to present our new interactive on-demand library, a comprehensive resource for mastering all key areas of UK GAAP standards.

Each module is designed with:

Detailed explanations of updated standards to keep you current.
Interactive case studies and real-world examples to bring concepts to life.
Optional exercises to test and reinforce your understanding.

Whether you're updating your knowledge or exploring in greater detail, this library provides the tools for confident application.

Learn more

AUDIT & ACCOUNTING

FRC launches campaign to support UK SMEs to grow and scale

The Financial Reporting Council (FRC) has https://www.frc.org.uk/news-and-events/news/2025/01/frc-launches-campaign-to-support-uk-smes-to-grow-and-scale/commenced a year-long campaign to help small and medium-sized enterprises (SMEs) access audit services and address the reporting challenges they face. The initiative in turn aims to improve their access to capital and to support their growth ambitions.

As part of the first phase of this campaign the FRC has launched a market study examining how effectively the audit market serves SMEs and exploring opportunities to reduce their reporting burden where possible.

FRC publishes thematic review of Climate-related Financial Disclosures by AIM and Large Private Companies

The FRC has published a thematic review of Climate-related Financial Disclosures (CFD) by AIM and large private companies, following the first cycle of mandatory reporting. CFD requirements were introduced for accounting periods beginning on or after 6 April 2022 and require companies to report on climate-related risks and opportunities if they have over 500 employees and are:

traded, banking, insurance or AIM companies; or
private companies or Limited Liability Partnerships, with turnover exceeding £500 million.

Unsurprisingly the review highlights several areas where disclosures commonly require improvement in what is a developing area of reporting.

UKEB publishes 2025 IFRS Standards

The UKEB has published the 2025 consolidated UK-adopted international accounting standards on behalf of the UK Government. The UKEB website contains links to the text of individual UK-adopted international accounting standards.

SUSTAINABILITY ASSURANCE

IESBA welcomes certification of its Global Ethics Sustainability Standards by PIOB and IOSCO Statement of Support

The International Ethics Standards Board for Accountants (IESBA) welcomes the Public Interest Oversight Board’s (PIOB) decision to certify its Global Ethics Sustainability Standards and the International Organization of Securities Commissions (IOSCO) Statement of Support calling on its members to apply or be informed by the new framework.

The Global Ethics Sustainability Standards include the International Ethics Standards for Sustainability Assurance (including International Independence Standards) (IESSA) and the revisions to the International Code of Ethics for Professional Accountants (including International Independence Standards) (the Code) related to sustainability reporting and to the use of the work of an external expert.

IAASB releases new guidance on ISSA 5000

To support practitioners, the International Auditing and Assurance Standards Board (IAASB) has released new guidance on the International Standard on Sustainability Assurance (ISSA) 5000, General Requirements for Sustainability Assurance Engagements, including an implementation guide, fact sheet, FAQs, and FAQ video series.

FRC sets out recommendations for the sustainability assurance market

The FRC has published the final report from its market study into the assurance of sustainability reporting. The 2024 study found that while the UK’s market for the assurance of sustainability reporting is functioning well, there are concerns over quality consistency amid growing demand.

CHARITIES

FRC webinar covers how charities can prepare for major amendments to FRS 102

On 15 January 2025, the FRC hosted a webinar to discuss how the recent amendments to FRS 102 will impact UK charities and the ways they can prepare for implementation.

If you missed the webinar, you can watch the recording here.

TAXATION

R&D claimant support packages

HMRC are emailing guidance packages to customers following submission of R&D Claim Notification and Additional Information Forms. These packages will provide customers with key pieces of guidance and support when making R&D claims. To read more, please click here.

Loan Charge review launched

The Government has launched an independent review into the Loan Charge. To read more, please click here.

£35 million added to State Pension pots

Thousands of people have topped up National Insurance records to maximise State Pensions before a change in rules on 6 April 2025. To read more, please click here.

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