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\u2022\u00a0Goodwill on acquisitions will reduce your profits and net asset value\u00a0 perhaps affecting bank covenants <\/p>\n \u2022\u00a0Analyse the impact as soon as possible FRS 102 is the new suite of accounting requirements closely aligned to International Financial Reporting Standards. Their introduction is generating a lot of concern and interest as their adoption will affect many companies\u2019 reported financial statements. Here we consider the major areas affected as far as media sector<\/a> businesses are concerned.<\/p>\n The first sets of accounts being prepared under FRS102 are most commonly those for the year ending 31 December 2015 and after. In addition to assessing the changes for that year you will also need to calculate those same changes for 2014 and 2013 to provide updated FRS 102 compliant comparative information. This can end up being a big exercise for some companies.<\/p>\n The first sets of accounts being prepared under FRS102 are most commonly those for the year ending 31 December 2015 and after. In addition to assessing the changes for that year you will also need to calculate those same changes for 2014 and 2013 to provide updated FRS 102 compliant comparative information. This can end up being a big exercise for some companies. This is one of the most significant financial reporting changes in the UK for many years. Although many aspects of FRS 102 accounts will be recognisable, there are many changes too.<\/p>\n One of FRS102\u2019s aims is to improve comparability of financial statements with those prepared under IFRS. Profit and Loss, Balance Sheet and Cash-flow Statement become Statement of Comprehensive Income, Statement of Financial Position and Statement of Cash flows, as they are under IFRS. However companies can keep their current terminology combined with other disclosures. In addition to these statements, there will be a Statement of Changes in Equity, which will detail movements in balances such as share capital, share premium, revaluation reserve and retained earnings. There will be greater disclosure within accounting policies, such as Significant Judgements and Estimates. It is anticipated that most businesses will have one or two significant accounting estimates which will need to be disclosed.<\/p>\n
\n\u2022\u00a0Long term, interest-free\u00a0inter-company loans will have to be discounted at a commercial interest rate
\n\u2022\u00a0Exchange rate risk and interest rate risk hedging will have to be accounted for
\n\u2022\u00a0Any lease incentives or premiums on office leases will now have to be accounted for over the full life of the lease, so affecting your profit every year
\n\u2022\u00a0Unused holiday leave at the year-end will have to be accounted for which could reduce your profit
\n\u2022 Your reported profits will change and this could affect the corporation tax<\/a> due
\n\u2022 Greater amounts of disclosure and changes in terminology used in the financial statements<\/p>\nWhat should you do?<\/h2>\n
\n\u2022\u00a0Plan future reporting based on new rules
\n\u2022\u00a0Communicate changes with key stakeholders<\/p>\nYour quick guide to FRS 102<\/h2>\n
When do you need to apply new UK GAAP?<\/h2>\n
\nPlanning is the key to a successful outcome.<\/p>\nWill the accounts look different?<\/h2>\n
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<\/p>\nGoodwill<\/h2>\n