New LLP SORP issued
13 February 2017
On 26 January 2017, the Consultative Committee of Accountancy Bodies (CCAB) published the new LLP SORP (2017) which reflects the amendments to the LLP Regulations and the associated FRS 102 amendments.
The LLP SORP (2017) applies to UK LLPs reporting under FRS 102 and is effective for periods beginning on or after 1 January 2016 (early adoption is permitted for periods beginning on or after 1 January 2015 provided that the amendments to the LLP Regulations and FRS 102 amendments are also adopted early).
The LLP Regulations were amended by The Limited Liability Partnerships, Partnerships and Groups (Accounts and Audit) Regulations 2016 (SI 2016/575). As discussed in the June 2016 edition of Business Edge, the amendments to the LLP Regulations were made to align the LLP Regulations with the amended Companies Act 2006 and Company Regulations.
The main amendments to the SORP include:
- Removal of FRSSE references as this is not an available accounting framework for periods covered by the amended LLP Regulations.
- Adding in references to FRS 102 Section 1A. The SORP (2017) notes that while small LLPs will have to comply with the recognition and measurement requirements of FRS 102 and the SORP (2017), they should comply with the disclosure requirements of FRS 102 Section 1A rather than those of the SORP, with two exceptions as set out in paragraphs 27B and 27C of the LLP SORP (2017). The SORP (2017) also encourages small LLPs to include the reconciliation of movements in members’ other interests detailed in paragraph 59 of the SORP.
- Highlighting that the amended LLP Regulations now allow the balance sheet and profit and loss account formats to be adapted (eg the use of more IFRS aligned language) providing the information given is at least equivalent to that required by the LLP Regulation formats.
- Clarification that where an LLP has no equity, a Statement of Changes in Equity is not required, as long as this is stated within the accounts.
In addition to these amendments, a number of minor clarifications have been made to the SORP, including amending the existing guidance to address diversity in practice on accounting for ‘automatic divisions’ of profits. Although the wording around this has been clarified, no changes to existing requirements are intended by the CCAB.
Read the LLP SORP (2017)
For help and advice on LLP issues, please contact Anna Jarrold or Nick Carter-Pegg.
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