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Legal Terms - Financial Reporting Standards (FRSs)
As of 2016, six Financial Reporting Standards (FRSs) have been issued by the Financial Reporting Council, the entity appointed for this role under Companies Act 2006, section 464. The purpose of FRSs is to delineate the accounting treatment necessary for a company's accounts to present a "true and fair view" of the organization's status, as mandated by Companies Act 2006 s 396. FRS 102 delineates the treatment and disclosure requirements for corporations in general, FRS 105 pertains to micro-entities, while the remaining standards (100, 101, 103, 104) are applicable to specific activities or company structures. Compliance with Financial Reporting Standards is mandatory for the accounts of unincorporated entities to assess the profit subject to taxation (Income Tax (Trading and Other Income) Act 2005 § 25). All previously established standards are rendered obsolete. Companies listed in the UK must adhere to the standards established by the International Accounting Standards Board. Compliance with FRSs is mandatory for the financial statements of unincorporated entities to assess the profit subject to taxation (Income Tax (Trading and Other Income) Act 2005 s 25).
As of 2016, six Financial Reporting Standards (FRSs) have been issued by the Financial Reporting Council, the entity appointed for this role under Companies Act 2006, section 464. The purpose of FRSs is to delineate the accounting treatment necessary for a company's accounts to present a "true and fair view" of the organization's status, as mandated by Companies Act 2006 s 396. FRS 102 delineates the treatment and disclosure requirements for corporations in general, FRS 105 pertains to micro-entities, while the remaining standards (100, 101, 103, 104) are applicable to specific activities or company structures. Compliance with Financial Reporting Standards is mandatory for the accounts of unincorporated entities to assess the profit subject to taxation (Income Tax (Trading and Other Income) Act 2005 § 25). All previously established standards are rendered obsolete. Companies listed in the UK must adhere to the standards established by the International Accounting Standards Board. Compliance with FRSs is mandatory for the financial statements of unincorporated entities to assess the profit subject to taxation (Income Tax (Trading and Other Income) Act 2005 s 25).
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