UK part

Question 1

Borrowing costs

Answer 1

IFRS = must be capitalised, UK = optional

Question 2

Development costs

Answer 2

IFRS = must be capitalised, UK = optional

Question 3

Goodwill (4 things)

Answer 3

1) UK = only partial goodwill (% of assets which means goodwill is not recognised in NCI only in the parent)
2) UK = Goodwill is amortised (over 10 years)
3) UK = negative goodwill is recognised on balance sheet and amortised (over 10 years). IFRS would go to P&L
4) UK = contingent consideration is only recognised if it is probable, always for IFRS

Question 4

Leases

Answer 4

IFRS = lessee capitalised all leases, unless >1 year or very small. UK = only capitalised if meets definition of finance leases

Question 5

Financial instruments

Answer 5

UK = FVTPL or amortised costs (no OCI)

Question 6

Assets held for sale

Answer 6

UK = no designation, keep as normal (continue to depreciate and do not move to current assets)

Question 7

Deferred tax

Answer 7

UK = recognised on timing differences (not temporary differences), very minimal impact on numbers

Question 8

Concepts and principles

Answer 8

FRS 102 only uses costs and FV - IFRS = conceptual framework and FV

Question 9

FS presentation and BS and P&L

Answer 9

FS presentation
UK = companies act requirement and true and fair override (can go away from requirement to ensure it meets primary function of FS) - IFRS = Conceptual framework and IAS 1

BS and P&L
UK = companies act requirment - IFRS = conceptual framework and IAS 1

Question 10

Listed implications

Answer 10

If debt or equity is traded on a regulated exchange must do IFRS not UK

Question 11

FRS 101 reduced disclosure

Answer 11

Only for qualifying entities (not group entities)
Not classified as being prepared in accordance with EU adopted IFRS, the FS are classified as ‘Companies Act financial statements’

Question 12

Events after the reporting period

Answer 12

FRS102 allows dividends reported after reporting date to be present as a separate component of retained earnings

Question 13

PPE

Answer 13

IFRS = requires annual reviews of recoverable value (FV) but UK = only when indication of impairment is present

Question 14

Related party disclosure

Answer 14

UK = transactions between parent and wholly owned sub are exempt from disclosure

Question 15

Foreign currency translation

Answer 15

UK = does not have a foreign currency translation reserve

Question 16

Investment property

Answer 16

FRS102 states IP must be held at FV - IFRS option of FV or cost

Question 17

Discontinued operations

Answer 17

FRS102 = Results of discontinued ops presented in a separate column in P&L as opposed to a single line item

Question 18

Assets held for sale

Answer 18

FRS102 = no reclassification as IFRS has but it is seen as an impairment indicator

Question 19

Revenue

Answer 19

FRS = recognise when risks and rewards are transferred