The Future of UK GAAP

Organisation

Accounting Standards Board

Summary

This consultation sets out the Accounting Standards Board’s (ASB’s) strategy for the future basis of UK/Irish Generally Accepted Accounting Practice (GAAP) (UK GAAP) and its convergence with International Financial Reporting Standards (IFRS).

The consultation closes on 1st February 2010.

Why is this of interest?

Can you imagine a world without the Charity SORP? For many charity finance professionals this may be difficult – it now seems very much part of our financial way of life.
But with the move to converge UK Accounting practice (UK GAAP) with international accounting standards there will need to be change. And so the charity SORP could disappear.

This consultation will help shape this process of convergence, and thus presents a chance for you to let it know what you think at the beginning of this journey and it may be your opportunity to influence charity accounting for a generation. The changes that come about will be with is for a considerable time.

The ASB is proposing its own converged public benefit entity accounting standard – which would cover charity accounting. Key issues with this would include are:

• • What areas of accounting in our sector are different to the commercial sector and need special guidance? For example, should charities be required to provide for multiyear grant commitments? Or should we value volunteer time in our accounts?  Is the SoFA the best way of presenting financial information for a charity?

• • How complex should charity accounts be? Who should we aim to prepare them for?

• • Is the ASB proposal the right one?

• • If we have a public benefit entity accounting standard what supplementary guidance should there be?

The ASB discussion paper is about the whole process of convergence for UK companies not just charities.  It is important the voice of the charity sector is heard.

More Information

More information please see the ASB website, and the consultation document.