Audit and assurance update: Does preparing statutory accounts take up too much of your time?

Every Financial Director or Financial Controller wants a timely and smooth year-end process including the preparation of statutory accounts.

For those preparing statutory accounts in-house, this can present an unwelcome challenge, with updates to accounting standards, disclosures and legislation, as well as the time requirement involved.

Looking to the future, there are proposed changes to Financial Reporting Standard 102 (FRS 102). These proposals, which are expected to be finalised later in 2023, will apply for accounting periods commencing on or after 1 January 2025, so typically for December 2025 year ends.

The major proposed changes to FRS 102 surround lease accounting and revenue recognition. The former will see most operating leases brought ‘on balance sheet’, whilst the latter requires a five-step model for recognising revenue from contracts with customers.

These accounting requirements have been enshrined in International Financial Reporting Standards (IFRS) for a few years – we all know that IFRS eventually tends to feed into UK GAAP at some point. Bringing lease accounting into UK GAAP has been a ‘hot-topic’ of discussion for many years.

For many preparers this will require up front consideration of the impact, both for accounting and disclosures, brought about by the changes. For some the impact could be significant; in particular, the way in which lease accounting affects reported earnings before interest, tax, depreciation and amortisation (EBITDA).

Whilst December 2025 feels quite a way away, 1 January 2025, the date when the changes are proposed to be effective from, is not!

We also live in an ever-changing world and changes in ethical rules might prevent your auditors from providing you with the assistance you need.

Outsourcing your statutory accounts preparation could, therefore, be a viable solution.

Hazlewoods provides a bespoke outsourcing service for the preparation of high-quality statutory accounts, tailored to your specific needs. We work with you and guide you through the accounting implications of change and the related disclosure requirements affecting you.

Our partner led team ensures compliance and high-quality, allowing your finance team to concentrate on running your business during the year-end process.

To find out more, including case studies and what our clients say, visit our Statutory Accounts page here.

Alternatively, if you would like to discuss this further, please get in touch using the contact details below.

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