FRS 102: accounting for subsidiaries and groups - tips and pitfalls

Accounting for groups and subsidiaries under the FRS 102 accounting framework is complicated and varies from accepted practice under the old UK GAAP rules. Colin Edwards, director at KPMG, examines the potential pitfalls, sets out recommended accounting treatment and provides practical examples of application of the new rules under new UK GAAP

With FRS 102, Financial Reporting Standard applicable in the UK and Ireland, effective for periods commencing on or after 1 January 2015, entities are now starting to consider (if they haven’t already) their transition from old UK GAAP. The accounting for subsidiaries is one area in which there have been differences between old UK GAAP and International Financial Reporting Standards (IFRS) and so some changes should be expected.