Filling the GAAP for small companies
Article Abstract:
A working party organized by the Consultative Committee of Accounting Bodies (CCAB) has released a report that makes the radical recommendation that small companies be exempted from all but the most important accounting standards. The CCAB report proposes that small companies, as defined by the Companies Act, should comply only with five basic accounting standards: SSAP 18; Contingencies; SSAP 17, Post Balance Sheet Events; SSAP 13, Research and Development; SSAP 9, Stocks and Long-term Contracts; and SSAP 4, Government Grants. In addition, the CCAB report suggests that UITF Abstract 7, which covers disclosure requirements, should also remain mandatory for all small companies. Apart from these standards, the CCAB working party proposes that all other standards be ignored by small companies since they are not vital to ensuring the proper reporting of financial transactions.
Publication Name: Accountancy
Subject: Business
ISSN: 0001-4664
Year: 1995
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Implementing FRS 8: some practical aspects
Article Abstract:
The Accounting Standards Board released the accounting standard Financial Reporting Standard (FRS) No. 8, 'Related Party Disclosure,' in Oct. 1995. The standard took effect for accounting periods starting on or after Dec. 23, 1995. Accountants and directors should understand what is required by FRS No. 8 and how the information is to be gathered throughout the financial periods to ensure complete compliance with the standard. There are four steps involved in implementing FRS No. 8: identification of related parties, examination of details of transactions with the related parties, verification of materiality of the transactions and construction of the disclosure note, aggregating if possible. Preparers should also study the exemptions included in the third and fourth paragraphs of the standard.
Publication Name: Accountancy
Subject: Business
ISSN: 0001-4664
Year: 1996
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