The Sorp revision: Preparation starts now

The first article in a series by finance expert Don Bawtree

Don Bawtree
Don Bawtree

The UK faces a total change in how companies produce their year-end accounts. The rules have been rewritten in one comprehensive framework called FRS 102.

Changes in charity reporting are therefore also inevitable. From December 2015 year-ends onwards, charities currently using the 2005 Sorp will have to use a new version conforming to FRS 102.

Many charities will be affected this year. Those using the new framework will need to restate their 2014 results as a comparator in their 2015 accounts. For charities with December year-ends, everything from the closing balance sheet of 2013 will need to be prepared on the new basis.

The Sorp is being overhauled to fit the new rules. A consultation will run through the summer and the rules will be finalised in early 2014. Only then can charities really begin to address any changes.

The impact will become clearer in the coming weeks: treasurers should keep an eye on this issue and this column will flag up the topics to watch.

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