The future of UK GAAP

Danielle Stewart explores the potential impact of the forthcoming changes to UK GAAP, in particular those affecting SMEs.

Danielle C Stewart, Partner at Baker Tilly. As well as being an active partner in the Business Advisory department of Baker Tilly, where she runs the firm’s Reporting Support service, Danielle is a member of the Financial Reporting Committee at the ICAEW and a member of the European Financial Reporting Advisory Group’s SME committee.

Background

Accounting standards in the UK are a rather messy mixture of a few remaining old Statements of Standard Accounting Practice, a large body of UK specific Financial Reporting Standards (FRSs), a number of Urgent Issues Task Force abstract and since 2004, a selection of FRSs based on EU adopted International Financial Reporting Standards (IFRS), which were issued as part of the ‘convergence’ project. This last category includes several standards on financial instruments, although these are optional for unlisted companies. All commentators agree that the current situation is not optimal.