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Contents
8.2.1 Extract from FRS102-Section 8.2–8.4.
8.3 Disclosure of accounting policies.
8.3.1 Extract from FRS102-Section 8.5.
8.3.2.2 Sample Accounting policies.
8.3.2.2.1 General information.
8.3.2.2.2 Basis of preparation.
8.3.2.2.4.1 Basis of consolidation.
8.3.2.2.4.1.1 Subsidiary undertakings.
8.3.2.2.4.1.2 Associates and joint ventures.
8.3.2.2.4.1.3 Transactions eliminated on consolidation.
8.3.2.2.5 Business combinations and goodwill.
8.3.2.2.9 Contingent acquisition consideration.
8.3.2.2.11 General turnover accounting policy notes.
8.3.2.2.11.2 Turnover accounting policy for an insurance broker.
8.3.2.2.11.4 Turnover accounting policy note where turnover is derived from investments.
8.3.2.2.11.5 Turnover accounting policy for a software company.
8.3.2.2.11.6 Turnover accounting policy for a construction company.
8.3.2.2.12.1 Example using an accruals model.
8.3.2.2.12.2 Example using the performance model.
8.3.2.2.14 Dividend distribution.
8.3.2.2.16 Financial instruments.
8.3.2.2.16.1 (a) Trade and other debtors.
8.3.2.2.16.2 (b) Cash and cash equivalents.
8.3.2.2.16.3 (c) Other financial assets.
8.3.2.2.16.4 (d) Trade and other creditors.
8.3.2.2.16.6 (f) Derivatives (no hedge accounting)
8.3.2.2.16.7 Derivatives (where hedge accounting is applied)
8.3.2.2.16.7.1 Hedge Accounting.
8.3.2.2.16.7.1.1 Cash flow hedges.
8.3.2.2.16.7.1.2 Fair value hedges.
8.3.2.2.16.9 Offsetting financial instruments.
8.3.2.2.17 Compound financial instruments.
8.3.2.2.18.1 Environmental liabilities.
8.3.2.2.20.1 (a) Annual bonus plans.
8.3.2.2.20.2 (b) Annual bonus plans.
8.3.2.2.20.3 (c) Defined contribution pension plans.
8.3.2.2.20.4 (d) Defined benefit pension.
8.3.2.2.21 Preference share capital.
8.3.2.2.23 Related party transactions.
8.3.2.2.26 Property, plant and equipment.
8.3.2.2.28 Investment properties.
8.3.2.2.30 Extract of a leasing company.
8.3.2.2.35 Investment properties.
8.3.2.2.36 Biological assets – forestry.
8.3.2.2.37 Biological assets – Livestock (where a fair value model is adopted)
8.3.2.2.38 Biological assets – Forestry (where cost model is adopted)
8.3.2.2.39 Biological assets – Livestock (where cost model is adopted)
8.4 Information about judgements.
8.4.1 Extract from FRS102-Section 8.6.
8.5 Information about key sources of estimation uncertainty.
8.5.1 Extract from FRS102-Section 8.7.
8.5.2.2 Sample critical accounting judgements and estimates disclosures.
8.5.2.2.1 Critical Accounting Judgements and Estimates.
8.5.2.2.3 Inventory provisioning.
8.5.2.2.4 Providing for doubtful debts.
8.5.2.2.5 Valuation of investment properties.
8.5.2.2.7 Defined benefit pension scheme.
8.5.2.2.9 Tax provisions and deferred tax assets.
8.5.2.2.10 Contingent consideration.
8.5.2.2.11 Business combinations.
8.5.2.2.12 Establishing useful lives for amortisation of goodwill and intangible assets.
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8.2 Structure of the Notes
8.2.1 Extract from FRS102-Section 8.2–8.4
8.2 The notes shall:
(a) present information about the basis of preparation of the financial statements and the specific accounting policies used, in accordance with paragraphs 8.5 to 8.7;
(b) disclose the information required by this FRS that is not presented elsewhere in the financial statements; and
(c) provide information that is not presented elsewhere in the financial statements but is relevant to an understanding of any of them.
8.3 An entity shall, as far as practicable, present the notes in a systematic manner. An entity shall cross-reference each item in the financial statements to any related information in the notes.
8.4 An entity normally presents the notes in the following order:
(a) a statement that the financial statements have been prepared in compliance with this FRS (see paragraph 3.3);
(b) a summary of significant accounting policies applied (see paragraph 8.5);
(c) supporting information for items presented in the financial statements, in the sequence in which each statement and each line item is presented; and
(d) any other disclosures.
8.2.2 OmniPro comment
Although Section 8.3 of FRS 102 above states that as far as practicable the notes should run in order of items in the primary financial statements, this is not mandated, the overriding principal is that the notes should be presented in a way that makes it easy for the user of the financial statements to read. The recommended order of notes is detailed in Section 8.4 of FRS 102 and is:
- Compliance statements with FRS 102 (see 8.3.2)
- Significant accounting policies (see 8.3.2)
- Supporting information for items presented in the financial statements in the sequence and line items they are presented
- Any other disclosures required by the FRS
Section 3.24 of FRS 102 specifically requires disclosure of the entity’s domicile and legal form, its country of incorporation and address of the registered office and a description of the entities principal activities. See the example of this disclosure below in Example 1 – General information at 8.3.2.2.1.
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Examples
Example 1: Extract of examples of accounting policies note.
Example 2: Critical Accounting Judgements and Estimates
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