Newswire September 2024

AUDIT & ACCOUNTING

FRC publishes amendments to FRS 101 Reduced Disclosure Framework 

The FRC has issued minor Amendments to the FRS 101 Reduced Disclosure Framework following the 2023/24 annual review cycle. 

Changes include a disclosure exemption from presenting certain comparative information, and a conditional exemption for qualifying entities in respect of certain disclosures about supplier finance arrangements required by IAS 7 Statement of Cash Flows. 

Amendments were also made to Appendix II Note on Legal Requirements for consistency with IAS 1 Presentation of Financial Statements. 

FRC issues consultation on Going Concern Guidance 

The FRC has issued a consultation on revisions to its Guidance on the Going Concern Basis of Accounting and Related Reporting, including Solvency and Liquidity Risks. Once finalised, it will replace the FRC’s existing guidance, issued in 2016. 

The FRC comments that the draft Guidance is intended to help companies prepare high-quality, company-specific disclosures about their going concern conclusions and how they were reached. The FRC add that Guidance will be non-mandatory and will serve as a proportionate and practical guide to all UK companies within its scope, which includes companies that apply the UK Corporate Governance Code, but excludes small companies and micro-entities. 

The consultation closing date is 28 October 2024. The FRC expects to publish the final guidance in early 2025. 

FRC publishes thematic reviews into offsetting in the financial statements and IFRS 17 Insurance Contracts 

The FRC has published two thematic reviews into the quality of UK company reporting in respect of offsetting in the financial statements and IFRS 17 Insurance Contracts. 

The FRC comments that offsetting contributes to a number of the FRC’s top ten reporting findings. It involves presenting items that would otherwise be shown separately as a single net amount. International Financial Reporting Standards (IFRS) permit or require offsetting only in specific situations. The FRC add that inappropriate use of offsetting can mask the full extent of the risks relating to a company’s assets and liabilities, income and expense, and cash flows. 

Discussion Paper launched on the Future of Digital Reporting in the UK 

A cross-regulatory group, comprising the FCA, Companies House, HMRC and the Charity Commission for England and Wales, has launched comprehensive discussion paper on the future of digital reporting in the UK. 

The group aims to gather stakeholder feedback on crucial developments in digital reporting. The paper addresses changes in the regulatory landscape and considers the impact of the recently passed Economic Crime and Corporate Transparency Act 2023. 

The deadline for submitting comments is 1 November 2024. 

IASB proposes IFRS Accounting Taxonomy update for Contracts for Renewable Electricity 

The IASB has published a proposed update to the IFRS Accounting Taxonomy 2024 to reflect the proposed disclosure requirements for renewable electricity contracts.  

The proposed amendments relate to IFRS 9 Financial Instruments and IFRS 7 Financial Instruments: Disclosures. 

The deadline for submitting comments is 14 October 2024. 

ICAEW 

ICAEW changes to the UK Audit Regulations 

The ICAEW have made changes to the UK Audit Regulations with more to follow. 

The first amendments will come into effect on 1 October 2024 and include changes to: 

• clarify that registered auditors must ensure that they and their staff comply with their professional body’s CPD regulations; 

• the eligibility criteria to make it clear that where a firm’s constitution, however comprised, includes certain decisions that need more than a simple majority-vote for approval, that audit-qualified persons must be able to control any such ‘super-majorities’. The ICAEW acknowledge that these changes are complex and therefore more information on these eligibility-related changes has been issued. Firms will have until 1 April 2025 to comply; and 

• the eligibility criteria to allow audit qualifications of certain overseas individuals to now be recognised in the UK. 

More changes are planned for 2025 which include: 

• extending the powers of ICAEW’s Audit Registration Committee (ARC) to enable it to issue non-financial sanctions against on Ris; and 

• the introduction of compulsory alternates for sole practices, although there are no immediate. 

The ICAEW comment that they are staggering these updates to give firms time to adapt and to ensure compliance. 

TAXATION

Need to register for Self Assessment? Top 5 myths - debunked

HMRC have clarified some common myths about Self Assessment tax returns. To read more, please click here.

New HMRC postal forms to register as a subcontractor

HMRC has published two new postal forms which can be used to register a limited company or a partnership as a subcontractor with payment under deduction. To find out more, please read the following two articles:

https://www.gov.uk/guidance/register-a-partnership-as-a-subcontractor-with-payment-under-deduction-by-post

https://www.gov.uk/guidance/register-a-limited-company-as-a-subcontractor-with-payment-under-deduction-by-post