The Financial Reporting Council (‘FRC’) have announced the proposals put forward in Financial Reporting Exposure Draft 67 (‘FRED 67’) have been finalised (see announcement here). The key proposals are:
- Simplifying the accounting for directors’ loans by small entities by no longer requiring a market rate of interest to be estimated;
- Require fewer intangible assets to be separated from goodwill in a business combination;
- Permitting investment property rented to another group entity to be measured based on cost (rather than fair value);
- Amendments to the classification of financial instruments, allowing more to be measured based on cost not fair value; and
- Simplification of the definition of financial institutions.
These amendments will be effective for accounting periods beginning after 1 January 2019 but early adoption is permitted. The full amendments are available here.