Impact of New FRS for HMRC Filing
While iXBRL conversions of financial statements and tax computations are now routine activities for corporation taxpayers in UK, new challenges await filers in the latter half of this year.
Ever since the Financial Reporting Council (FRC) came up with the timelines for implementing the Financial Reporting Standards (FRS), accounting communities have been discussing the impact on disclosures to be made by listed and non-listed companies; while iXBRL tagging service and solution providers have been discussing the new taxonomy releases and upgrades that support the new accounting standards. The new accounting standards include new iXBRL taxonomies and exclude provisions for minimum tagging.
While early adopters appreciate the benefits of mandatory full taxonomy tagging, the real challenge will be for companies who are new to iXBRL tagging and who must adopt the new standards and taxonomies for the first time this year.
With HMRC scheduled to withdraw support for older accounting standards and related taxonomies in the last quarter of this year, it would be worth our while to be cognisant of the mandatory adoption dates of the new iXBRL taxonomies, and what companies can do to ensure smooth iXBRL filing and tax returns submissions this year.
The Impact of Impact of New FRS on HMRC Filing:
|Accounting standard||Description||To be adopted for accounting periods starting on or after||iXBRL taxonomy||Mandatory for HMRC submissions from||To whom does it apply to|
|FRS 101||Reduced Disclosure Framework for qualifying subsidiaries and parent companies in UK||1 Jan 2015||FRS 101||01 Apr 2015||The new reduced disclosure framework enables most subsidiaries and parents to use the recognition and measurement bases of IFRS’ in their individual entity financial statements while being exempt from a number of disclosures required by full IFRS’.|
Replaces all extant FRSs, UK GAAP, SSAPs and UITF Abstracts. It is based on the IFRS for SMEs
|1 Jan 2015||FRS 102||01 Apr 2015||Derived from the IFRS for SMEs, the Financial Reporting Council has made significant modifications to address company law requirements and incorporate additional accounting options.|
|FRS 102 1A Small entities||The Financial Reporting Standard for Smaller Entities||1 Jan 2016||FRS 102||01 Oct 2016||Entities currently applying the FRSSE will need to transition to either FRS 105 (if they qualify as Micro-entities) or the small entity requirements within FRS 102|
Insurance and Reinsurance Contracts
|1 Jan 2015||FRS 102||–||When queried, HMRC specified that at present FRS 102 taxonomy can be used and they are aware that certain facts cannot be tagged.|
|FRS 104||Replaces the existing Accounting Standards Board (ASB) Statement Half-yearly financial reports, issued in 2007||1 Jan 2015|
Replaces the existing Accounting Standards Board (ASB) Statement Half-yearly financial reports, issued in 2007
|–||Half-yearly financial reports and for entities that do not report under IFRS but do prepare an interim report. Few entities are likely to need or want to apply FRS 104.|
|FRS 105||The Financial Reporting Standard applicable to the Micro-entities||1 Jan 2016||FRS 102||01 Oct 2016||Financial reporting standard for companies eligible to apply the Micro-entities Regime set out in UK Company Law.|
IFRS – EU Adopted
|International Financial Reporting Standard||–|
|01 Apr 2015||–|
|CHARITIES – SORP||Charity SORP (FRS 102)||1 Jan 2015||Charities FRS 102 SORP taxonomy||01 Oct 2016||Mandatory for accounts submitted to HMRC on or after 1st October 2016 or prepared for APs starting on or after 1st January 2016|
It is worth a mention that HMRC has expressed that effective 01 October 2016, it would like to stop accepting accounts tagged using the older UK GAAP, UK IFRS and UK GAAP Charity taxonomies for accounting periods starting on or after 1st January 2016.
If you are a company or an accountant in practice looking for a hassle-free transition, outsourcing your iXBRL work would be a smart decision. If adapting to the new regime delays your accounts preparation leaving you very little time to convert your word to iXBRL or pdf to iXBRL, then DataTracks and similar iXBRL tagging service providers can help you.