CFM23010 - New UK GAAP: overview

New UK GAAP

As noted at CFM20030 New UK GAAP includes FRS 101, FRS 102 and FRS 105. For those that apply FRS 101 the requirements and guidance in this manual which relates to IAS 39 or IFRS 9 will apply (depending on period being reviewed as noted at CFM21505) unless otherwise stated.

Overview of FRS 102

For those that apply FRS 102 the accounting for financial instruments is principally governed by Sections 11, 12 and 22. Section 11 and Section 12 address the recognition and measurement aspects while Section 22 addresses the distinction between liabilities and equity.

The requirements of Section 22 are aligned to those of IAS 32 (and FRS 25 under Old UK GAAP) and consequently detailed guidance on this is presented at CFM21200+.

The recognition and measurement aspects of Section 11 and 12 in respect of financial instruments differ from IAS 39 and IFRS 9. CFM23015 – CFM23090 focuses on those requirements.

The detailed provisions on derivatives (CFM24000+), hybrid debt (CFM25000+) and hedging (CFM27000+) are separately addressed in the dedicated guidance to those subjects.

Overview of FRS 105

Those entities that meet the eligibility criteria of a micro entity may choose to apply the simplified accounting requirements of FRS 105. For those that apply FRS 105 the accounting for financial instruments is principally governed by Sections 9 and 17. Section 9 address the recognition and measurement aspects while Section 17 addresses the distinction between liabilities and equity. CFM23092+ focuses on these requirements.