FRC has published transitional provision guidance

The FRC has issued guidance for preparers using IFRS.  This includes proposed wording to explain the basis of accounts preparation, where an entity has a financial period which straddles the end of the transition period following the UK’s exit from the European Union.

For UK company act IFRS reporters with a 31 December 2020 year end the basis of preparation will need to make reference to UK company law but the accounting standards will be in line with EU IFRS. From 1 January UK adopted IFRS will apply which isn’t expected to diverge from EU IFRS but for timing differences in adopting any amendments. For listed companies that comply with the Financial Conduct Authority’s Disclosure, Guidance and Transparency rules, these continue to reference EU IFRS so additional disclosure will be required in the basis of preparation (see guidance)