Transitioning from FRS 102 Section 1A to full FRS 102
Sarah Flint explores the common financial reporting issues faced by entities as they grow and transition from applying the small companies regime of FRS 102 Section 1A to FRS 102 in full.
Medium-sized entities must prepare a Strategic Report, which should be fair, balanced and understandable. A recent example I’ve seen started with a tongue-in-cheek ‘this family-owned business isn’t bothered, neither is anyone else, I’ve ticked through the disclosure checklist, is this enough?’ Here’s what happened when we took their original comments and discussed it further.
To make it ‘fairer’ we added the position at the year end and explained the increase in profits, in this case, due to a significantly improved lead time. The bigger the business, the more detail is likely to be needed.