COVID-19 and FRS 102: how to improve disclosures
17 September: In light of COVID-19, ICAEW’s Financial Reporting Faculty has published new guidance on how to improve disclosures when preparing accounts in accordance with FRS 102.
Published earlier this week, the guide is aimed at companies applying FRS 102. It identifies key areas where entities might need to consider the impact of COVID-19 when preparing disclosures within their annual report and accounts.
The uncertainty and disruption caused by COVID-19 means that providing readers with transparency on how the pandemic has affected an entity’s individual performance, position and future prospects is more important than ever. The guide flags that for disclosures to be most relevant to users, the general principle is that they should be tailored to an entity’s individual circumstances.
The guide covers a range of relevant topics including, for example, disclosures around key sources of estimation uncertainty, significant judgements made in applying accounting policies, fair value of investment property and new and existing bank loans and other loans payable. It also considers the presentation requirements for material items and alternative performance measures, and factors to consider when preparing a strategic report.
ICAEW Financial Reporting Faculty is recognised internationally as a leading authority on financial reporting matters. The faculty is responsible for formulating ICAEW policy and makes submissions to standard setters and other external bodies on behalf of ICAEW. The faculty provides an extensive range of practical guidance to its members on common financial reporting problems. Further resources can be found at icaew.com/financialreporting.
Further explanation of FRS 102’s scope can be found in Bloomsbury Professional Online Services.