Corporation Tax

Transition from FRS 105 to FRS 101

Produced by Tolley in association with Malcolm Greenbaum
  • 08 Feb 2022 09:26

The following Corporation Tax guidance note Produced by Tolley in association with Malcolm Greenbaum provides comprehensive and up to date tax information covering:

  • Transition from FRS 105 to FRS 101
  • Introduction
  • Main effects

Transition from FRS 105 to FRS 101

Introduction

This would be a very unlikely transition in practice. It would mean an entity that was previously a micro-entity would have become a subsidiary of a parent company producing consolidated financial statements and elected to use FRS 101 because its parent produces financial statements under IFRS.

Main effects

FRS 105 provides a very simple framework for accounting, for example:

  1. it does not permit fair value accounting, including revaluations

  2. deferred tax is not recognised

  3. only the contributions payable (broadly) are recognised if the entity has a defined benefit pension scheme

  4. development costs must not be capitalised

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