ICAEW.com works better with JavaScript enabled.

UK endorsement of IFRS

UK preparers that prepare their financial statements in accordance with UK-adopted international accounting standards can only apply accounting standards once they have been endorsed.

This includes all IFRSs that were EU-endorsed at 31 December 2020 plus those that have subsequently been endorsed by UKEB (see below for more details).

The latest version of the Endorsement Status Report is available on the website of the UK Endorsement Board (UKEB).

Although unendorsed standards and interpretations cannot be adopted in the UK, the requirements of those standards and interpretations may be applied early if they do not conflict with the requirements of any endorsed standards or interpretations.

Find out more about the UK Endorsement Board.

UK-adopted IFRS

The UK formally left the EU on 31 January 2020, but continued to be subject to EU rules until the end of the transition period, defined as 11.00pm on 31 December 2020 (GMT). This is referred to as the implementation period (IP) completion day in the European Union (Withdrawal Agreement) Act 2020.

UK legislation provides that all IFRSs that had been endorsed by the EU on or before the IP completion day became UK-adopted IFRS. On 31 December 2020, UK and EU-adopted IFRS were therefore identical. After 31 December 2020, any new IFRSs or amended IFRSs will require independent endorsement in the UK to be part of the suite of UK-adopted IFRS that can be applied by UK companies.

The transition to UK-adopted IFRS

UK preparers need to consider whether to apply EU-endorsed IFRS  or UK-endorsed international accounting standards.

UK companies with accounting periods beginning on or after 1 January 2021 will be required to switch from applying IFRS as adopted by the EU to IFRS as adopted by the UK.

For accounting periods beginning before 1 January 2021, legislation published in March 2020 introduced some flexibility as to whether a UK company applies EU* or UK-adopted IFRS. This flexibility applies only to accounting periods:

  • That began before and ended on or after IP completion day, or
  • That began and ended before IP completion day and IP completion day occurred before the end of the period for filing the accounts.

As noted above, IP completion day is defined as 11.00pm on 31 December 2020; therefore an accounting period that began at 00.01 on 31 December 2020 will have begun prior to IP completion day.

* After IP completion day (31 December 2020) ‘EU-adopted IFRS’ available for use by UK companies in their accounts will be the version frozen at that date ie, it will not reflect any further endorsements issued by the EU after 31 December 2020. Therefore, UK companies wishing to adopt ‘Interest Rate Benchmark Reform—Phase 2’ and/or ‘Extension of the Temporary Exemption from Applying IFRS 9’ must apply UK-adopted IFRS in their accounts.

Standards issued but not yet effective or applied in the accounts

IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors requires disclosure of any new standards and interpretations that have been issued but are not yet effective and have not yet been applied in the financial statements, together with information relevant to assessing the possible impact when implemented for the first time.

Further resources

Become a Financial Reporting Faculty member

Find out more about the benefits of membership and joining details.

Join now