Amendments to FRS 101 - 2015/16 cycle in July 2016

In July 2016, the FRC issued Amendments to FRS 101 – 2015/16 cycle following the conclusion of their 2015/16 annual review.

The objective of the FRC’s annual review process is to ensure that FRS 101 remains a cost-effective option for listed groups by providing additional disclosure exemptions as IFRS changes.

The amendments as a result of this annual review process are limited and predominately reduce the disclosure requirements when IFRS 15 Revenue from Contracts with Customers comes into force.

Amendments to the standard

IFRS 15 Revenue from contracts with customers

  • Disclosure exemptions have been added in relation to IFRS 15 paragraphs 110 (part), 113(a), 114, 115, 118, 119(a) to (c), 120 to 127 and 129.
  • Paragraph 114 of IFRS 15 requires disclosure of revenue into categories that show how the nature, amount, timing and uncertainty of revenue and cash flow are affected by economic factors.
  • Whilst the amendment provides an exemption from this requirement, large and medium sized entities will still need to have regard to the legal requirement to disclose particulars of turnover, including the amount of turnover attributable to each class of business carried on by the company, and when relevant, turnover attributable to different geographical markets .
  • The exemptions are available when IFRS 15 is applied for the first time.

Amendments to Appendix II: note on legal requirements

Accounting for participating interests in separate financial statements

  • The change to Schedule 1 permitting the use of the equity method in individual financial statements for companies other than banking and insurance companies is effective from 1 January 2016, which is the same date as the amendment to IAS 27.

Notes to the financial statements

  • The legal requirements clarify that in applying paragraphs 113 and 114 of IAS 1 which sets out the order of the notes to the financial statements, an entity must also have regard to the additional requirements set out the Regulations ie that the notes be presented in the order in which the items to which they relate are presented in the statement of financial position and the income statement (SI 2008/410 Schedule 1 paragraph 42(2)).
  • This is effective from 1 January 2016.

For more more information please contact Paul Merris.