You are previewing Interpretation and Application of UK GAAP: For Accounting Periods Commencing On or After 1 January 2015.
O'Reilly logo
Interpretation and Application of UK GAAP: For Accounting Periods Commencing On or After 1 January 2015

Book Description

Get up to date on the latest UK GAAP, with practical application guidance

Interpretation and Application of UK GAAP is a comprehensive, practical guide to applying UK GAAP at all levels, for accounting periods commencing on or after January 1, 2015. This book examines all of the core principles for every business, from subsidiaries of major listed companies right down to the very small, owner-managed business. Each chapter includes a list of relevant disclosure requirements to facilitate understanding, and real-world examples bring theory to life to provide guidance toward everyday application. Readers gain practical insight into the preparation of accounts under the EU-adopted IFRS, FRSs 100, 101, and 102, the FRSSE, and the Companies Act 2006, with expert guidance as to which requirements apply in which situations, and to which companies, and the type of disclosure each scenario requires. The book also includes detailed analysis of the planned changes to the Small Companies' Regime which are scheduled to take effect in 2016.

With sweeping changes coming into effect from January 1st 2015, financial statement preparers must have a sound appreciation of how the new UK GAAP works. This book provides a complete guide, with the latest regulations and straightforward advice on usage.

  • Understand UK GAAP application at all levels

  • Learn how to handle all relevant key accounting treatments

  • Refer to complete disclosure requirement lists for each topic

  • Get up to date on the latest area-specific practices

  • With new accounting practices in many broad areas including investment property, inventory valuations, deferred tax, fixed assets, and more, auditors and accountants need an awareness of how the new financial reporting regime will affect them. Interpretation and Application of UK GAAP is the most comprehensive reference, with the latest information and practical guidance.

    Table of Contents

    1. Title Page
    2. Copyright
    3. About the Author
    4. Foreword
    5. Preface
    6. Acknowledgements
    7. Introduction
      1. History of the UK and Republic of Ireland Standard-Setting Body
      2. Issuance of the New UK GAAP
      3. Structure of the New UK GAAP
      4. Smaller Companies and the Financial Reporting Standard for Smaller Entities
    8. Chapter 1: General Requirements of the Companies Act 2006
      1. Introduction
      2. Accounting Requirements under the Companies Act 2006
      3. True and Fair and Adequate Accounting Records
      4. International Financial Reporting Standards
      5. Generally Accepted Accounting Practice
      6. Substance of Transactions
      7. Directors' Reports
      8. Group Accounts
      9. Approval of Financial Statements
      10. Interaction of FRS 102 Terminology with Companies Act 2006 Terminology
      11. Micro-Entities Legislation
    9. Chapter 2: The Statutory Audit Requirement and Accounting Principles
      1. Introduction
      2. The Statutory Audit Requirement
      3. The Reform of Audit in 2012 and the Implications
      4. The Concepts and Pervasive Principles
      5. Qualitative characteristics
      6. The Financial Statement Elements and the Recognition and Measurement of those Elements
    10. Chapter 3: The Primary Financial Statements and Disclosure Notes
      1. Introduction
      2. Presentation of Financial Statements Fair presentation
      3. Compliance with FRS 102
      4. Frequency and consistency
      5. Complete set
      6. Statement of Financial Position
      7. Statement of Comprehensive Income and the Income Statement
      8. Statement of Changes in Equity and Statement of Income and Retained Earnings
      9. Statement of Cash Flows
      10. Notes to the Financial Statements
      11. Going Concern
    11. Chapter 4: Financial Reporting for Smaller Companies
      1. Introduction
      2. Financial Reporting Standard for Smaller Entities versus FRS 102
      3. Consequential Amendments to the FRSSE (effective April 2008) Due to FRS 102
      4. Micro-Entities
      5. Changes to the Small Companies Regime
    12. Chapter 5: Summary of the Key Differences between FRS 102 and ‘Old’ UK GAAP
      1. Introduction
      2. Accounting Policies and Errors
      3. Statement of Cash Flows (Cash Flow Statement)
      4. Consolidated Financial Statements
      5. Deferred Taxation
      6. Defined Benefit Pension Plans
      7. Employee Benefits
      8. Fair Value Accounting
      9. Fixed Assets
      10. Goodwill and Intangible Assets
      11. Investment Properties
      12. Leases
      13. Revenue Recognition
      14. Inventory (Stock) Valuations
      15. Differences between FRS 102 and <i xmlns="http://www.w3.org/1999/xhtml" xmlns:epub="http://www.idpf.org/2007/ops" xmlns:m="http://www.w3.org/1998/Math/MathML" xmlns:svg="http://www.w3.org/2000/svg" xmlns:ibooks="http://vocabulary.itunes.apple.com/rdf/ibooks/vocabulary-extensions-1.0">IFRS for SMEs</i>
    13. Chapter 6: Consolidated and Separate Financial Statements
      1. Introduction
      2. Identifying a Group
      3. Small Groups
      4. Exemptions from Preparing Group Accounts
      5. Exclusions from Consolidation
      6. Principles of Consolidation
      7. The Purchase Method
      8. Goodwill in a Business Combination
      9. Step Acquisitions
      10. Disposal of a Subsidiary
      11. Deemed Disposals
      12. Merger Accounting
      13. Separate Financial Statements
      14. Disclosure Requirements
    14. Chapter 7: Accounting Policies, Estimates and Errors
      1. Introduction
      2. Adopting Accounting Policies
      3. Changing Accounting Policies
      4. Development of an Accounting Policy in the Absence of Specific Direction in FRS 102
      5. Accounting Estimates
      6. Changes in Accounting Estimates
      7. Correction of Errors
      8. Disclosure Requirements
    15. Chapter 8: Revenue Recognition
      1. Introduction
      2. Deferred Payment
      3. Specific Considerations
      4. Exchanges and Sales of Goods
      5. Rendering of Services
      6. Interest, Royalties and Dividends
      7. HM Revenue and Customs Requirements
      8. Disclosure Requirements
    16. Chapter 9: Assets Held for Sale and Discontinued Operations
      1. Introduction
      2. Major Disposals of Assets
      3. Asset Impairment
      4. Discontinued Operations
      5. Restatement of Comparatives
    17. Chapter 10: Employee Benefits
      1. Introduction
      2. Recognition of Short-Term Employee Benefits
      3. Defined Contribution Pension Plans
      4. Defined Benefit Pension Plans
      5. Deferred Tax Issues on Pensions
      6. Disclosure Requirements
    18. Chapter 11: Income Tax
      1. Introduction
      2. Value Added Tax (VAT)
      3. Income Tax
      4. Deferred Taxation
      5. Measurement of deferred tax
      6. Discounting deferred tax balances
      7. Disclosure Requirements
    19. Chapter 12: Intangible Assets
      1. Introduction
      2. Categories of Intangible Assets
      3. Recognition and Measurement
      4. Research and Development
      5. Amortisation
      6. Derecognition
      7. Disclosure Requirements
    20. Chapter 13: Property, Plant and Equipment and Investment Properties
      1. Introduction
      2. Recognition of an Item of Property, Plant and Equipment
      3. Subsequent Measurement of Property, Plant and Equipment
      4. Revaluation of Property, Plant and Equipment
      5. Depreciation of Property, Plant and Equipment
      6. Asset Construction
      7. Subsequent Expenditure on Property, Plant and Equipment
      8. Qualifying Criteria for Investment Property
      9. Accounting Treatment for Investment Property
      10. Investment Property Subject to Leasing Arrangements
      11. Deferred Tax Issues Relating to Investment Property
      12. Reclassification of Investment Property to Property, Plant and Equipment
      13. Transitional Issues
      14. Disclosure Issues
    21. Chapter 14: Borrowing Costs
      1. Introduction
      2. Definition and Recognition of Borrowing Costs
      3. Capitalisation Rate
      4. Suspension of Asset Construction
      5. Transitional Issues
      6. Disclosure Issues
    22. Chapter 15: Impairment of Assets
      1. Introduction
      2. Indicators that an Asset is Impaired
      3. Internal sources
      4. Impairment of Inventories
      5. Impairment of Other Assets
      6. Impairment of Cash-Generating Units
      7. Goodwill Impairment
      8. Reversal of Impairments
      9. Disclosures
    23. Chapter 16: Government Grants
      1. Introduction
      2. The Performance Model
      3. The Accrual Model
      4. Small Companies
      5. Interaction with the Companies Act 2006
      6. Disclosure Requirements
    24. Chapter 17: Financial Instruments
      1. Introduction
      2. Basic Financial Instruments
      3. Derecognition of basic financial instruments
      4. Other Financial Instrument Issues
      5. Hedge accounting
      6. Disclosure Requirements: Financial Instruments
      7. Disclosure Requirements: Hedge Accounting
    25. Chapter 18: Inventories and Work-in-Progress
      1. Introduction
      2. Measurement of Inventories
      3. Cost of Inventories and Work-in-Progress
      4. Cost Methodologies
      5. Consignment Inventories
      6. Disclosure Requirements
    26. Chapter 19: Share-based Payment
      1. Introduction
      2. Recognition of a Share-based Payment Transaction
      3. Amendments to a Share-based Payment Arrangement
      4. Cancelling a Share-based Payment Arrangement
      5. Group Plans
      6. Disclosure Requirements
    27. Chapter 20: Leases
      1. Introduction
      2. Finance Leases
      3. Operating Leases
      4. Manufacturer/Dealer Lessors
      5. Sale and Leaseback Transactions
      6. Potential Changes to Lease Accounting
      7. Small Companies
    28. Chapter 21: Provisions and Contingencies
      1. Introduction
      2. Meaning of a Provision
      3. Recognition and Measurement of a Provision
      4. Onerous Contracts
      5. Meaning of a Contingent Liability and a Contingent Asset
      6. Events after the Reporting Period Relating to Contingencies
      7. Disclosure Issues
    29. Chapter 22: Statement of Cash Flows
      1. Introduction
      2. Objective of the Statement of Cash Flows
      3. Format of the Statement of Cash Flows
      4. Dividends and Interest
      5. Material Non-Cash Transactions
      6. Small Companies
      7. Consolidated Financial Statements
      8. Disclosure Issues
    30. Chapter 23: Investments in Associates and Joint Ventures
      1. Introduction
      2. Identifying an Investment in an Associate
      3. Significant Influence
      4. Initial Measurement and Equity Accounting
      5. Joint Ventures: Definitions and Classifications
      6. Joint Ventures: Other Issues
      7. Disclosure Requirements
    31. Chapter 24: Related Parties
      1. Introduction
      2. Issues Relating to Directors
      3. Definition and Identification of a Related Party
      4. Transactions with Related Parties
      5. Exemption from Disclosure of Related Party Transactions
      6. Controlling Parties
      7. Companies Act 2006
      8. Directors' Remuneration and Other Benefits
      9. Directors' Advances, Credits and Guarantees
    32. Chapter 25: Specialised Activities
      1. Introduction
      2. Agriculture
      3. Extractive Industries
      4. Service Concession Arrangements
      5. Financial Institutions
      6. Retirement Benefit Plans: Financial Statements
      7. Heritage Assets
      8. Funding Commitments
      9. Incoming Resources from Non-Exchange Transactions
      10. Public Benefit Entity Issues
    33. Chapter 26: Liabilities and Equity
      1. Introduction
      2. Interaction of Financial Liabilities and Equity
      3. Ordinary Share Capital
      4. Preference Share Capital
      5. Revaluation Reserve
      6. Dividends
      7. Convertible Debt
      8. Share Splits
      9. Bonus Share Issues
      10. Rights Issues
      11. Share Premium Account
      12. Share Buybacks
      13. Treasury Shares
      14. Distributable Profit
      15. Distributions
    34. Chapter 27: Events after the Reporting Period
      1. Introduction
      2. Adjusting Events
      3. Non-Adjusting Events
      4. Payment of Dividends
      5. Going Concern
      6. Authorising the Financial Statements for Issue
      7. Disclosure Requirements
    35. Chapter 28: Foreign Currency Translation
      1. Introduction
      2. Functional Currency
      3. Presentation Currency
      4. Monetary and Non-Monetary Items
      5. Net Investment in a Foreign Operation
      6. Disclosure Requirements
    36. Chapter 29: Small Company Abbreviated Financial Statements
      1. Introduction
      2. Content of Abbreviated Financial Statements
      3. The Strategic Report
      4. Micro-Entity Issues
      5. Appendix – Small company abbreviated financial statements
    37. Chapter 30: Reduced Disclosure Framework
      1. Introduction
      2. Reduced Disclosures for Subsidiaries and Ultimate Parents
      3. Statement of Compliance
      4. Options Available for UK Subsidiaries
    38. Chapter 31: First-Time Adoption of FRS 102
      1. Introduction
      2. Identifying the Date of Transition
      3. Accounting Policy Alignments
      4. Statement of Compliance
      5. Disclosure Requirements
    39. Index
    40. End User License Agreement