Companies with December year ends need to be thinking about the practical applications of reporting under the new UK GAAP. In this month’s scenario,  the focus is on company S, a retail group consisting of a holding company (S Ltd) and two trading subsidiaries (L and M), each of which runs a chain of stores, one of low-priced fashion clothing and one more mid-market.

Until last year, it also had a third subsidiary, Q, responsible for high-end quality clothing, but this business was sold off to allow a better focus: the decision was taken, and sale committed to, in late 2014. However, ownership of the brand and the stock did not change hands, and the leases were not transferred, until February 2015.