Route 102 – One man’s year-long journey……Day 11

  • By Jeremy Williams
  • 19/01/2015

To mark this momentous year for UK GAAP, I'm embarking on a mission to work my way through FRS 102, reading a portion on each working day of 2015 and writing a short blog entry on my thoughts and musings (be they few or many).

We begin week 3 with a bucket of strong coffee and a peek at section 8...

DAY 11 (19 Jan)

Section 8 is short. Seven paragraphs short. It's called Notes to the Financial Statements. Notably (pun intended), it contains hardly any of the required notes to the financial statements. Sounds like it's not even trying, doesn't it? In fact, paragraph 8.1 states that 'in addition to the requirements of this section, nearly every other section of this FRS requires disclosures that are normally presented in the notes.'

So what is in section 8 then? The section:

  • requires disclosure of significant accounting policies (including measurement basis or bases)
  • suggests a running order for the notes (FRS 102 compliance statement, then the accounting policies, then analysis of the financial statement items, then other disclosures. In other words, what we'd all do intuitively anyway.
  • includes disclosure of judgements and estimates, including 'key sources of estimation uncertainty'. The standard does not list the competence and level of alertness of an accountancy firm's junior staff as a key source of estimation uncertainty.

OK, that's section 8. Tomorrow the real work begins - consolidated and separate financial statements. Fasten your seatbelts.

P.S. If you missed Friday's instalment click here

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