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Latest update on new accounting framework

Following the debates on the issue of Financial Reporting Exposure Drafts (FREDs) 43, 44 and 45 on the future of financial reporting in the UK, it is likely that the UK accounting framework will be changing, possibly soon.

ICAEW has responded to the consultations on FRED 43, 44 and 45 and welcomes the Accounting Standards Board’s (ASB) decision at its 8 September meeting to re-expose the proposals. The ASB considered re-exposure was necessary due to the significant changes now proposed to the original exposure draft.

A number of changes have been mooted to the text of FRED 44, and it also appears that the ASB has decided to scrap the extension of EU-adopted ‘full IFRS’ to ‘publically accountable entities’ (as defined in FRED 43) – these would now be able to use the proposed Financial Reporting Standard for Medium-sized Entities (FRSME). This means that any concern about public benefit entities such as charities, social housing and higher and further education organisations having to apply ‘full IFRS’ has gone away.