UK GAAP

Question 1

Who must prepare FS under international accounting standards?

Answer 1

Listed groups of companies

Question 2

Who can prepare FS under UK GAAP?

Answer 2

Non-listed groups of companies

Though can opt to use international standards if they wish

Question 3

What is UK GAAP made of?

Answer 3

1. UK Accounting standards
2. Colony law

Question 4

Who is responsible for issuing UK accounting standards?

Answer 4

The financial reporting council (FRC)

Previously the accounting standards board (ASB)

Question 5

Most important financial reporting standard?

Answer 5

FRS 102

Question 6

2 things required of C FS according to CA?

Answer 6

1. Specific format
2. True and fair view

Question 7

CA: Required FS docs?

Answer 7

1. P&L account
2. BS
3. Directors’ report l
4. Auditor’s report (if audited)

Question 8

International standards agency

Answer 8

International Accounting Standards Board (IASB)

Question 9

The 2 international standards?

Answer 9

1. IFRS
2. IAS (older)

Question 10

IAS Stock exchange requirements

Answer 10

Must follow rules of SE they are a part of

Question 11

Do Cs following IASs still have to follow company law?

Answer 11

Yes

But can use international formats

Question 12

International terminology: statement of profit or loss

Answer 12

Profit and loss account/income statement

Question 13

International terminology: revenue

Answer 13

Turnover

Question 14

International terminology: finance costs

Answer 14

Interest payable

Question 15

International terminology: statement of financial position

Answer 15

Balance sheet

Question 16

International terminology: Non-current assets

Answer 16

Fixed assets

Question 17

International terminology: PPE

Answer 17

Tangible assets

Question 18

International terminology: carrying amount/carrying value

Answer 18

NBV

Question 19

International terminology: inventory

Answer 19

Stock

Question 20

International terminology: receivables

Answer 20

Debtors

Question 21

International terminology: allowance for receivables

Answer 21

Provision for doubtful debts

Question 22

International terminology: irrecoverable debt

Answer 22

Bad debt

Question 23

International terminology: cash and cash equivalents

Answer 23

Cash at bank/in hand

Question 24

International terminology: retained earnings

Answer 24

Profit and loss account

Question 25

International terminology: non-current liabilities

Answer 25

Creditors falling due in more than 12 months

Question 26

International terminology: loan notes

Answer 26

Debentures

Question 27

International terminology: current liabilities

Answer 27

Creditors falling due in less than 12 months

Question 28

International terminology: payables

Answer 28

Creditors

Question 29

UK GAAP balance sheet format differences

Answer 29

1. Top part shows net assets
2. Bottom part shows shareholders’ finds

Question 30

Net assets

Answer 30

Fixed assets + current assets - current liabilities - long term liabilities

Question 31

Shareholders’ funds =

Answer 31

Share capital + reserves

Question 32

UK GAAP Balance sheet

Answer 32

First assets
Intangible assets
Tangible assets
Investments

Current assets
Stock
Debtors
Investments
Cash at bank and in hand

Creditors: Amounts falling due within one year

Net current assets

Total assets less current liabilities

Creditors: amours falling due after more than one year
Provisions for liabilities

Capital and reserves
Called-up share capital
Share premium account
(Other reserves)
Profit and loss account

Question 33

UK GAAP P&L Format

Answer 33

Turnover
COS

GROSS PROFIT
Distribution costs
Admin expenses
Other operating income

OPERATING PROFIT
Interest receivable and similar income
Interest payable and similar charges

PROFIT BEFORE TAX
Tax

PROFIT AFTER TAX