FRS 101 qualifying entity

The New UK GAAP FRS 101 would be applicable for accounting periods starting from 01.01.2016 however early adoption prior to that date is available if selected voluntarily by the entity.

FRS 101 can be adopted by entities meeting the following criteria:

1. The company must be a qualifying entity (See Note 1 below); 

2. The shareholders of the company must have been notified in writing and make no objection to use of the exemption; and 

3. The company must state in its financial statements:

i)   A brief narrative summary of the exemptions adopted

ii)  The name of the parent in whose group financial statements it is consolidated; and

iii) From where those group financial statements may be obtained.

Under FRS 101, a charity may not be a qualifying entity. FRS 101 cannot be applied in consolidated financial statements.

Note 1 - A qualifying entity is a member of a group where the parent of that group prepares publicly available consolidated financial statements which are intended to give a true and fair view (of the assets, liabilities, financial position and profit or loss) and  that entity must be included in the consolidation.

Caveat

The opinions expressed are those of Mr. Devendraprasad Kankonkar (Deva). The material is for general information only and does not constitute investment, tax, legal or other form of advice. You should not rely on this information to make (or refrain from making) any decisions. Always obtain independent, professional advice for yourself as the advice may change based on your circumstances.

FRSSE 2015 effective date

UK GAAP introduced with prime purpose of replacing FRSSE 2008

SCOPE:

The FRSSE may be applied to all financial statements intended to give a true and fair view of the financial position and profit or loss (or income and expenditure) of all entities that are:

(a) small companies or small groups as defined in companies legislation preparing Companies Act individual or group accounts; or

(b) entities which are not registered with Companies House but would also qualify under (a) if they had been incorporated under companies legislation, with the exception of building societies.

DATE EFFECTIVE FROM:
Its applicable for accounting periods starting from 01.01.2015 and available only for 1 year. You can call this GAAP a stop gap arrangement for transition from old UK GAAP to new UK GAAP. It is not available for accounting periods starting from 01.01.2016.

NOT APPLICABLE TO:-

FRSSE does not apply to:

(a) large or medium-sized companies, groups and other entities;

(b) public companies;

(c) companies preparing individual or group accounts in accordance with international accounting standards;

(d) companies preparing individual or group accounts in accordance with the fair value accounting rules for certain assets and liabilities set out in Section D of Schedule 1 of Regulation 2008/409 to the Companies Act 20065 ;

(e) a company that is an authorised insurance company, a banking company, an emoney issuer, an MifId investment firm or a UCITS management company or a company that carries on insurance market activity;

(f) a person (other than a small company) who has permission under Part 4 of the Financial Services and Markets Act 2000 (in the UK) to carry on a regulated activity or, notwithstanding the definition of a small company in the legislation, companies authorised under the Investment Intermediaries Act 1995 (in the Republic of Ireland); or

(g) members of an ineligible group. 

A group is ineligible if any of its members is:

 (i) A public company;

(ii) A body corporate (other than a company) whose shares are admitted to trading on a regulated market in an EEA State;

(iii) A person (other than a small company) who has permission under Part 4 of the Financial Services and Markets Act 2000 to carry on a regulated activity;

(iv) A small company that is an authorised insurance company, a banking company, an e-money issuer, a MifId investment firm or a UCITS management company; or

(v) A person who carries on insurance market activity.

Caveat

The opinions expressed are those of Mr. Devendraprasad Kankonkar (Deva). The material is for general information only and does not constitute investment, tax, legal or other form of advice. You should not rely on this information to make (or refrain from making) any decisions. Always obtain independent, professional advice for yourself as the advice may change based on your circumstances.