When an entity moves to FRS 102 from another financial reporting framework such as FRS 105 The Financial Reporting Standard applicable to the Micro-entities Regime, it must apply the transition process from the date of transition.

The ‘date of transition’ is the start date of the earliest period reported in the financial statements.

Example – date of transition

Sunnie Ltd has previously applied FRS 105 when preparing its financial statements. However, the company has outgrown FRS 105 and must transition to FRS 102 for the year ended 31 May 2024. In this example, the prior year comparative financial statements will be the 31 May 2023. The start date of this year is 1 June 2022 and hence this is the date of transition.