Generally accepted accounting practice in the United Kingdom: UK GAAP
Gespeichert in:
| Hauptverfasser: | , , |
|---|---|
| Format: | Buch |
| Sprache: | English |
| Veröffentlicht: |
Basingstoke
Macmillan
1992
|
| Ausgabe: | 3. ed. |
| Schlagworte: | |
| Online-Zugang: | Inhaltsverzeichnis Inhaltsverzeichnis |
| Beschreibung: | 2. Aufl. u.d.T.: Generally accepted accounting practice in the United Kingdom |
| Beschreibung: | XLIII, 1496 S. graph. Darst. |
| ISBN: | 0333578988 |
Internformat
MARC
| LEADER | 00000nam a2200000 c 4500 | ||
|---|---|---|---|
| 001 | BV005769280 | ||
| 003 | DE-604 | ||
| 005 | 20210910 | ||
| 007 | t | ||
| 008 | 921106s1992 d||| |||| 00||| eng d | ||
| 020 | |a 0333578988 |9 0-333-57898-8 | ||
| 035 | |a (OCoLC)27011575 | ||
| 035 | |a (DE-599)BVBBV005769280 | ||
| 040 | |a DE-604 |b ger |e rakddb | ||
| 041 | 0 | |a eng | |
| 049 | |a DE-473 |a DE-384 | ||
| 050 | 0 | |a HF5616.G7 | |
| 082 | 0 | |a 657.0941 |2 20 | |
| 084 | |a QP 800 |0 (DE-625)141940: |2 rvk | ||
| 084 | |a QP 822 |0 (DE-625)141945: |2 rvk | ||
| 100 | 1 | |a Davies, Mike |e Verfasser |4 aut | |
| 245 | 1 | 0 | |a Generally accepted accounting practice in the United Kingdom |b UK GAAP |c Mike Davies, Ron Paterson & Allister Wilson of Ernst & Young |
| 246 | 1 | 3 | |a UK GAAP |
| 246 | 1 | 3 | |a UK GAAP |
| 250 | |a 3. ed. | ||
| 264 | 1 | |a Basingstoke |b Macmillan |c 1992 | |
| 300 | |a XLIII, 1496 S. |b graph. Darst. | ||
| 336 | |b txt |2 rdacontent | ||
| 337 | |b n |2 rdamedia | ||
| 338 | |b nc |2 rdacarrier | ||
| 500 | |a 2. Aufl. u.d.T.: Generally accepted accounting practice in the United Kingdom | ||
| 650 | 7 | |a Financiële verslaglegging |2 gtt | |
| 650 | 4 | |a Accounting |x Standards |z Great Britain | |
| 650 | 4 | |a Accounting |z Great Britain | |
| 650 | 0 | 7 | |a Rechnungswesen |0 (DE-588)4048732-5 |2 gnd |9 rswk-swf |
| 650 | 0 | 7 | |a Rechnungslegung |0 (DE-588)4128343-0 |2 gnd |9 rswk-swf |
| 650 | 0 | 7 | |a Buchführungsgrundsätze |0 (DE-588)4069703-4 |2 gnd |9 rswk-swf |
| 650 | 0 | 7 | |a Richtlinie |0 (DE-588)4137814-3 |2 gnd |9 rswk-swf |
| 651 | 4 | |a Großbritannien | |
| 651 | 7 | |a Großbritannien |0 (DE-588)4022153-2 |2 gnd |9 rswk-swf | |
| 689 | 0 | 0 | |a Großbritannien |0 (DE-588)4022153-2 |D g |
| 689 | 0 | 1 | |a Buchführungsgrundsätze |0 (DE-588)4069703-4 |D s |
| 689 | 0 | |5 DE-604 | |
| 689 | 1 | 0 | |a Rechnungslegung |0 (DE-588)4128343-0 |D s |
| 689 | 1 | 1 | |a Richtlinie |0 (DE-588)4137814-3 |D s |
| 689 | 1 | 2 | |a Großbritannien |0 (DE-588)4022153-2 |D g |
| 689 | 1 | |8 1\p |5 DE-604 | |
| 689 | 2 | 0 | |a Großbritannien |0 (DE-588)4022153-2 |D g |
| 689 | 2 | 1 | |a Rechnungswesen |0 (DE-588)4048732-5 |D s |
| 689 | 2 | |5 DE-604 | |
| 700 | 1 | |a Paterson, Ron |e Verfasser |4 aut | |
| 700 | 1 | |a Wilson, Allister |e Verfasser |4 aut | |
| 856 | 4 | 2 | |m HBZ Datenaustausch |q application/pdf |u http://bvbr.bib-bvb.de:8991/F?func=service&doc_library=BVB01&local_base=BVB01&doc_number=003604124&sequence=000002&line_number=0001&func_code=DB_RECORDS&service_type=MEDIA |3 Inhaltsverzeichnis |
| 856 | 4 | 2 | |m HBZ Datenaustausch |q application/pdf |u http://bvbr.bib-bvb.de:8991/F?func=service&doc_library=BVB01&local_base=BVB01&doc_number=003604124&sequence=000004&line_number=0002&func_code=DB_RECORDS&service_type=MEDIA |3 Inhaltsverzeichnis |
| 999 | |a oai:aleph.bib-bvb.de:BVB01-003604124 | ||
| 883 | 1 | |8 1\p |a cgwrk |d 20201028 |q DE-101 |u https://d-nb.info/provenance/plan#cgwrk | |
Datensatz im Suchindex
| _version_ | 1804119953078484992 |
|---|---|
| adam_text | List of chapters
( 1 /The development of UK GAAP 1
C TS The quest for a conceptual framework for financial reporting 29
(^3j) Revenue recognition 99
4 Group financial statements 143
5 Foreign currencies 313
6 Fixed assets and depreciation 437
7 Investment properties 525
8 Investments 545
9 Research and development 567
10 Capitalisation of borrowing costs 587
11 Stocks and long-term contracts 627
12 Capital instruments 677
13 Off balance sheet transactions 745
14 Leases and hire purchase contracts 805
15 Government grants 861
16 Segmental reporting 873
17 Pension costs 917
18/ Taxation 1001
19 ) Reporting of financial performance 1067
20 Earnings per share 1123
21 Post balance sheet events 1161
22 Contingencies 1183
23 Cash flow statements 1203
24 Related parties 1269
25 Directors and officers loans and transactions 1303
26 Directors remuneration 1343
Appendix: Specimen financial statements 1387
Index of extracts from accounts 1459
Index 1465
Detailed contents
CHAPTER 1 THE DEVELOPMENT OF UK GAAP 1
1 What is UK GAAP? 1
1.1 Principles or practice ? 1
1.2 What is generally accepted ? 2
2 Accounting standards and the concept of true and fair 3
2.1 The introduction of the true and fair concept 3
2.2 The interaction of accounting standards and the law 4
2.3 The role of International Accounting Standards 6
2.4 The experience of other countries 7
2.4.1 US 7
2.4.2 Canada 8
2.4.3 Germany 9
3 The development of Accounting Standards 10
3.1 The Accounting Standards Committee 10
3.1.1 The creation of the ASC 10
3.1.2 The objects and terms of reference of the ASC 11
3.1.3 The Watts Report 11
3.1.4 The McKinnon Report 12
3.1.5 The Dearing Report 12
3.1.6 The implementation of the Dearing proposals 15
3.2 The Accounting Standards Board 16
4 GAAP for small companies 17
4.1 The Big GAAP/Little GAAP debate 17
4.2 Exemptions for small companies 18
4.3 What is the small company solution? 19
5 Summary financial statements 20
5.1 The required form of a summary financial statement 20
5.2 Commentary 25
6 Conclusion 26
viii Generally Accepted Accounting Practice in the United Kingdom
CHAPTER 2 THE QUEST FOR A CONCEPTUAL FRAMEWORK
FOR FINANCIAL REPORTING 29
1 Introduction 29
1.1 What is a conceptual framework? 29
1.2 Why is a conceptual framework necessary? 29
1.3 Early attempts to establish a framework 31
2 The AICPA s initiatives in the United States 32
2.1 Accounting Research Studies 32
2.2 APB Statement No. 4 34
2.3 The Wheat and Trueblood Committees 34
3 The FASB Conceptual Framework 35
3.1 Introduction 35
3.2 The objectives of financial reporting 37
3.3 The qualitative characteristics of accounting information 39
3.3.1 The decision-makers 40
3.3.2 The cost/benefit constraint 40
3.3.3 Understandability 41
3.3.4 Relevance and reliability 41
3.3.5 Comparability 43
3.3.6 Materiality 43
3.3.7 Conservatism 44
3.4 The elements of financial statements 44
3.4.1 Assets 44
3.4.2 Liabilities 45
3.4.3 Equity 46
3.4.4 Investments by owners 46
3.4.5 Distributions to owners 46
3.4.6 Comprehensive income 46
3.4.7 Revenues, expenses, gains and losses 47
3.5 Recognition and measurement 48
3.6 Conclusion 49
4 UK initiatives 50
4.1 SSAP 2: Disclosure of accounting policies 50
4.1.1 Fundamental accounting concepts 50
4.1.2 Accounting bases 51
4.1.3 Accounting policies 52
4.2 The Corporate Report 52
4.3 The Sandilands Report 55
4.3.1 Current Purchasing Power accounting 55
4.3.2 Value accounting 56
Detailed contents ix
4.3.3 Cash flow accounting 59
4.3.4 Current cost accounting (CCA) 61
4.4 The Macve Report 64
4.5 The Stamp Report 66
4.6 The ICAS discussion document: Making Corporate Reports Valuable 67
4.6.1 Background to the study 67
4.6.2 Users and their needs 68
4.6.3 Valuation of assets and liabilities 69
4.6.4 The proposed new information package 70
4.6.5 Additional information 71
4.6.6 Conclusion 72
4.7 The Solomons Report 72
4.8 The Future Shape of Financial Reports 77
5 The ASB s Statement of Principles 78
5.1 Introduction 78
5.2 The objective of financial statements 79
5.3 The qualitative characteristics of financial information 79
5.4 The elements of financial statements 80
5.4.1 Assets 80
5.4.2 Liabilities 80
5.4.3 Equity 81
5.4.4 Gains 81
5.4.5 Losses 81
5.4.6 Contributions from owners 81
5.4.7 Distributions to owners 81
5.4.8 The overall approach 81
5.5 The recognition of items in financial statements 82
5.6 Presentation of financial information 85
5.7 Conclusion 85
6 Other International framework projects 85
6.1 The IASC conceptual framework 86
6.2 The CICA financial statement concepts 88
6.3 The Australian framework project 88
6.4 The New Zealand framework project 89
7 Conclusion 91
X Generally Accepted Accounting Practice in the United Kingdom
CHAPTER 3 REVENUE RECOGNITION 99
1 The nature of revenue 99
2 Realised profits 100
3 The timing of revenue recognition 102
3.1 The critical event approach 103
3.1.1 The recognition of revenue at the completion of production 103
3.1.2 The recognition of revenue at the time of sale 104
3.1.3 The recognition of revenue subsequent to delivery 106
3.2 The accretion approach 107
3.2.1 The use by others of enterprise resources 107
3.2.2 Long-term contracts 108
3.2.3 Natural growth 108
3.3 The revenue allocation approach 108
4 Fundamental recognition criteria 109
4.1 ASB Draft Statement of Principles Chapter 4: The recognition of items in
financial statements 109
4.1.1 The gain is earned Ill
4.1.2 The gain is realised Ill
4.1.3 The potential impact of the ASB s proposals on the recognition
of gains 112
4.2 IAS 18 113
4.2.1 The sale of goods 114
4.2.2 The rendering of services 115
4.2.3 The use by others of enterprise resources 116
4.2.4 Exposure draft E41 117
4.3 Canada 118
4.4 The US 118
4.4.1 The general rule 118
4.4.2 SFAC No. 5 119
4.4.3 FASB statements 120
4.5 Summary 120
5 Problem areas 122
5.1 Receipt of initial fees 122
5.1.1 Franchise fees 122
5.1.2 Advance royalty/licence receipts 125
5.1.3 Loan arrangement fees 126
5.1.4 Commitment fees 127
5.1.5 Credit card fees 127
5.2 Goods sold subject to reservation of title 1
Detailed contents xi
5.4 Advertising revenue 129
5.5 Software revenue recognition 130
5.5.1 Software licenses with no significant vendor obligations 130
5.5.2 Products sold with significant vendor obligations 131
5.5.3 Post-delivery customer support services 133
5.5.4 Data services 134
5.6 The disposal of land and buildings 135
5.7 Film exhibition rights 137
5.8 Sale and leaseback transactions 138
6 Conclusion 139
CHAPTER 4 GROUP FINANCIAL STATEMENTS 143
1 The concept of a group 143
1.1 The objectives of group financial statements 143
1.2 What is a subsidiary? 144
1.2.1 The EC Seventh Directive 144
1.2.2 The Companies Act 145
1.2.3 The approach used in other countries 152
1.3 Consolidating partly-owned subsidiaries 153
1.3.1 The entity concept 153
1.3.2 The proprietary concept 153
1.3.3 Comparison between the different concepts of a group 154
1.3.4 ED 50 and FRS 2 155
1.4 Principles of business combinations 157
2 Historical development of rules on group financial statements 158
2.1 Origins of group financial statements 158
2.2 The UK legislative background 158
2.3 Accounting standards in the UK 158
3 Consolidation of subsidiaries 159
3.1 Basic principles 159
3.2 Uniform accounting policies 160
3.3 Coterminous accounting periods 161
3.4 Elimination of unrealised profits/losses on inter-company transactions 162
4 Exemptions from preparing group financial statements 163
4.1 Intermediate holding companies 163
4.2 Small and medium-sized groups 166
4.3 Exemptions contained in FRS 2 167
Xll Generally Accepted ^counting practice in the United Kingdom
5 Exclusion of subsidiaries from group financial statements 168
5.1 Sources of rules on exclusion of f)af^cular subsidiaries 168
5.2 Different activities ....... 169
5.3 Operating under severe restrictions-.. 172
5.4 Held for subsequent resale ...... 175
5.5 General disclosure requirements in r iSj?ect of excluded subsidiaries 176
6 Equity accounting 177
6.1 Introduction 177
6.2 The definition of an associate ...... 178
6.2.1 SSAP 1 ...... 178
6.2.2 The Companies Act 1985- 179
6.2.3 ED 50 179
6.2.4 IAS 28 180
6.3 The accounting treatment of associate* •• 180
6.4 Other particular issues 182
6.4.1 Non-coterminous periods ... 182
6.4.2 Deficiency of assets.. 184
6.4.3 Investor not preparing gr^up financial statements 184
6.4.4 Joint ventures ...... 186
6.4.5 Loss of associate status, •¦ 189
6.4.6 Elimination of unrealisecj Profits on transactions with associates... 190
6.5 Disclosure requirements regarding i»sSoCiates... 192
6.5.1 Profit and loss account. ... 192
6.5.2 Balance sheet ,.,.-. 193
6.5.3 Notes ... 193
6.5.4 Acquisitions/Disposals. •. ... 195
6.5.5 Stock Exchange requirements....... 195
6.5.6 Proportionately consolidate joint ventures 196
7 Business combinations .... 297
7.1 Introduction , 297
7.1.1 ED 3 ... . .... . l97
7.1.2 Merger relief ....... .... 198
7-l-3 ED31 .. .... ZZZZZZZZZ.2O0
7.1.4 SSAP 23 201
7.1.5 Companies Act 1989 202
7.1.6 ED48 205
7.1.7 IAS 22 ....... .^ Z.ZZZZZZ. . 207
7.2 Acquisitions: basic principles ....... 207
7.3 Acquisitions: measuring the fair v^e of the consideration 208
7.3.1 Securities 209
7.3.2 Monetary items .,.-.. , 211
Detailed contents A1I1
7.3.3 Non-monetary items 211
7.3.4 Deferred consideration 212
7.3.5 Contingent consideration 212
7.3.6 Acquisition costs 216
7.3.7 Pre-acquisition dividends 216
7.4 Acquisitions: measuring the fair value of the net assets acquired 217
7.4.1 Basic principles 217
7.4.2 The use of hindsight 219
7.4.3 Proposed requirements for individual assets and liabilities 220
7.4.4 Subsequent amendments to fair value 229
7.4.5 Push-down accounting 234
7.5 Acquisitions: accounting for goodwill 235
7.5.1 Introduction 235
7.5.2 Immediate write-off: which reserve? 238
7.5.3 Effect on realised profits of writing off goodwill 247
7.5.4 Amortisation 249
7.5.5 Negative goodwill 252
7.6 Step-by-step acquisitions 255
7.6.1 Background 255
7.6.2 Example 255
7.6.3 FRS 2 requirements 259
7.7 Mergers 262
7.7.1 Basic principles 262
7.7.2 Equity eliminations 262
7.7.3 Expenses of the merger 264
7.7.4 Non-coterminous accounting periods 265
7.7.5 Dividends of the subsidiary 267
7.8 Disclosure requirements relating to business combinations 267
7.8.1 General 267
7.8.2 Acquisitions 267
7.8.3 Mergers 277
7.8.4 Transactions involving merger relief 280
7.8.5 Companies Act 280
8 Disposals 283
8.1 Basic principles 283
8.2 Effective date of disposal 283
8.3 Goodwill of subsidiaries disposed of 285
8.4 Partial disposals 289
8.5 Deemed disposals 291
8.6 Disclosure requirements relating to disposals 292
9 Group reorganisations 294
XIV Generally Accepted Accounting Practice in the United Kingdom
9.1 Introduction 294
9.2 Setting up a new top holding company 294
9.3 Changing direct ownership of a company within a group 296
9.3.1 Subsidiary moved up 296
9.3.2 Subsidiary moved along 298
9.3.3 Subsidiary moved down 298
9.4 Divisionalisation of an existing group 301
9.5 Demergers 301
9.6 Capital contributions 304
9.6.1 Treatment in the financial statements of the paying company 304
9.6.2 Treatment in the financial statements of the receiving company 304
10 Conclusion 305
CHAPTER 5 FOREIGN CURRENCIES 313
1 The development of an accounting standard in the UK 313
1.1 Background 313
1.2 SSAP6 314
1.3 ED 16 314
1.4 ED 21 315
1.5 ED 27 315
1.6 SSAP 20 316
2 Requirements of SSAP 20 316
2.1 Objectives of translation 316
2.2 Definitions of terms 316
2.3 Individual companies 317
2.3.1 Recording of transactions 318
2.3.2 Retranslation of monetary/non-monetary assets and liabilities at
balance sheet date 318
2.3.3 Treatment of exchange differences 318
2.3.4 Worked examples 318
2.3.5 Examples of accounting policies 319
2.3.6 Exchange gains where there are doubts as to convertibility or
marketability 319
2.3.7 Foreign equity investments financed by borrowings 320
2.3.8 Forward contracts 321
2.4 Consolidated accounts 322
2.4.1 Scope 322
2.4.2 Choice of method 322
2.4.3 Closing rate/net investment method 322
2.4.4 Temporal method 326
X
Detailed contents XV
2.4.5 Foreign equity investments financed by borrowings 330
2.4.6 Associated companies 335
2.4.7 Foreign branches 335
2.5 Disclosures 336
2.5.1 Requirements of SSAP 20 336
2.5.2 Examples of disclosures 337
3 Problem areas 339
3.1 Individual companies 339
3.1.1 Date of transaction 339
3.1.2 Use of average rate 340
3.1.3 Dual rates or suspension of rates 341
3.1.4 Monetary or non-monetary 342
3.1.5 Treatment of exchange differences 346
3.2 Exchange gains on long-term monetary items 348
3.2.1 In what circumstances do doubts as to convertibility or
marketability arise? 348
3.2.2 Past exchange losses 349
3.2.3 Settled or unsettled transactions 349
3.2.4 Current portion of long-term item 349
3.2.5 Restriction of gain 350
3.3 Forward contracts, currency swaps and currency options 350
3.3.1 Forward contracts 350
3.3.2 Currency swaps 359
3.3.3 Currency options 360
3.3.4 Current reporting practice 363
3.4 Consolidated accounts — closing rate/net investment method 364
3.4.1 Subsidiary with non-coterminous year end 364
3.4.2 Dual rates or suspension of rates 365
3.4.3 Calculation of average rate 366
3.4.4 Change from closing rate to average rate or vice versa 369
3.4.5 Which reserve should exchange differences be taken to? 371
3.4.6 Post-acquisition capital or revaluation reserves 371
3.4.7 Treatment of exchange differences on disposal of subsidiary 375
3.4.8 Change from closing rate/net investment method to temporal
method or vice versa 377
3.4.9 Hyperinflation 378
3.4.10 Goodwill on consolidation 381
3.4.11 Inter-period comparisons 382
3.4.12 Branches 385
3.5 Cover method 385
3.5.1 What are foreign currency borrowings ? 385
3.5.2 Borrowings taken out before or after the investment 386
XVJ Generally Accepted Accounting Practice in the United Kingdom
3.5.3 Repayment of borrowings 389
3.5.4 Goodwill on consolidation 391
3.5.5 All investments/borrowings? 394
3.5.6 Must currencies be the same? 395
3.5.7 Pooled basis? 399
3.5.8 What is meant by condition (b) of paragraph 51 and
condition (c) of paragraph 57? 401
3.5.9 What should happen in the year of change of the above
conditions not being met? 403
3.6 Intra-group long-term loans and deferred trading balances 406
3.6.1 General requirement 406
3.6.2 Paragraphs 20 and 43 407
3.6.3 How permanent is permanent? 407
3.6.4 What happens in year of change? 408
3.6.5 Is such a treatment allowed in the company financial statements?. .410
3.6.6 If so, how should loans be translated? 411
3.6.7 UK subsidiary with loan from overseas parent company 412
3.7 Other intra-group transactions 412
3.7.1 Dividends 413
3.7.2 Unrealised profits 414
4 Main criticisms of SSAP 20 and suggested solutions 415
4.1 Forward contracts and similar hedging contracts 415
4.1.1 Criticisms 415
4.1.2 Solution 416
4.2 Cover method 416
4.2.1 Criticisms 416
4.2.2 Solution 417
4.3 Reserve accounting 418
4.3.1 Criticism 418
4.3.2 Solution 418
4.4 Conclusion 419
5 Related Companies Act requirements 419
5.1 Realised profits 419
5.1.1 Schedule 4, paragraph 12 419
5.1.2 Section 262(3) 419
5.1.3 Settled transactions 420
5.1.4 Short-term monetary items 420
5.1.5 Long-term monetary items 420
5.2 Distributable profits 422
5.2.1 Section 263(3) 422
5.2.2 Long-term monetary items 422
Detailed contents xvii
5.2.3 Section 275 and Schedule 4, paragraph 89 422
5.2.4 Cover method 423
5.2.5 Branch accounting 424
5.3 Disclosure 425
5.3.1 Basis of translation 425
5.3.2 Treatment of exchange differences in profit and loss account 426
5.3.3 Reserve movements 426
5.3.4 Movements on provisions for liabilities and charges 427
5.3.5 Movements on fixed assets 427
5.4 Alternative accounting rules 427
5.4.1 Schedule 4, Part II, section C 427
5.4.2 SSAP 20, paragraph 66 428
6 Comparison with US and IASC pronouncements 428
6.1 US 428
6.1.1 General comment 428
6.1.2 Main differences 428
6.2 IASC 430
6.2.1 Cover method 431
6.2.2 Forward exchange contracts 431
6.2.3 Disclosure 431
6.2.4 Proposed revisions to IAS 21 431
^CHAPTER 6 FIXED ASSETS AND DEPRECIATION 437
1 Introduction 437
1.1 Background 437
1.2 The meaning of fixed assets 438
1.3 Criteria for recognition of fixed assets 439
1.3.1 General criteria 439
1.3.2 Criteria for intangible fixed assets 439
1.3.3 The brands debate: which intangible assets are capable of being
accounted for? 445
2 Cost 448
2.1 Basic requirement 448
2.2 Purchase price 448
2.3 Production cost 449
2.4 Directly and indirectly attributable costs 450
2.5 The period of production 451
2.6 Abnormal costs and cost inefficiencies 452
2.7 Improvements and repairs 453
XVJii Generally Accepted Accounting Practice in the United Kingdom
3 Depreciation 454
3.1 Introduction 454
3.2 Arguments against depreciation 455
3.3 The requirements of the Companies Act 462
3.4 SSAP 12 462
3.4.1 Scope 462
3.4.2 Definitions 463
3.4.3 Accounting treatment 463
3.4.4 Asset lives 463
3.4.5 Permanent diminutions 464
3.4.6 Change in method 464
3.4.7 Depreciation on revalued assets 464
3.4.8 Depreciation on land and buildings 464
3.5 Useful economic life 464
3.6 Residual values 466
3.7 Depreciation methods 467
3.7.1 Straight line method 467
3.7.2 Reducing balance method 468
3.7.3 Other reducing balance methods 469
3.7.4 Annuity method 470
3.7.5 Unit of production method 471
3.8 Changes in method of providing depreciation 472
3.9 Changes in estimated life 472
3.10 Treatment of minor items 474
4 Permanent diminutions 475
4.1 Introduction 475
4.2 Companies Act requirements 475
4.3 SSAP 12 and permanent diminutions 475
4.4 The estimation of recoverable amount 476
4.5 Diminutions in value of individual assets or portfolio of assets 477
5 Revaluations 478
5.1 Introduction 478
5.1.1 Background 478
5.1.2 ED 51 479
5.2 Bases of valuation 481
5.2.1 General principles 481
5.2.2 Open market value of land and buildings 485
5.2.3 Depreciated replacement cost of land and buildings 489
5.2.4 Valuations of other assets 490
5.2.5 The comparability of valuations 490
Detailed contents Xix
5.3 Accounting for revaluations 491
5.3.1 Accounting for revaluation surpluses 491
5.3.2 Depreciation of revalued assets 493
5.3.3 Disposal of revalued assets 495
5.3.4 Downward valuations and provisions for permanent impairment... .498
5.3.5 Other uses of the revaluation reserve 501
5.3.6 Distributable profits and revaluations of fixed assets 502
6 Disclosure 504
6.1 Introduction 504
6.2 Directors report 504
6.3 Balance sheet and profit and loss account 506
6.4 Accounting policies 507
6.5 Notes to the financial statements 509
6.6 Additional disclosures for items carried at valuation 511
7 Comparison with US and IASC 515
7.1 US 515
7.2 IASC 517
8 Conclusion 518
CHAPTER 7 INVESTMENT PROPERTIES 525
1 The development of an accounting standard in the UK 525
2 The requirements of SSAP 19 526
2.1 Definition of investment property 526
2.2 Balance sheet valuation 527
2.3 Revaluation reserve 527
2.4 Disclosure 527
3 Issues arising from SSAP 19 528
3.1 Relevant Companies Act requirements 528
3.1.1 Disclosure on use of true and fair override 528
3.1.2 Diminutions in value 528
3.1.3 Revaluation reserve 530
3.1.4 Balance sheet classification 531
3.2 Frequency of independent valuation 532
4 Comparison with US and IASC pronouncements 532
4.1 US 532
4.2 IASC 532
5 Issues specific to property companies 533
5.1 Profit and loss account presentation 533
5.2 Rectifications from investment property to trading property 537
^XX Generally Accepted Accounting Practice in the United Kingdom
5.3 Reclassifications from trading property to investment property 538
5.4 Turnover definition 540
5.5 Revenue recognition 541
5.6 Lessee accounting 541
6 Conclusion 541
CHAPTER 8 INVESTMENTS 545
1 Introduction 545
2 The requirements of the Companies Act 547
2.1 Classification 547
2.2 Accounting rules 548
2.2.1 Fixed asset investments 548
2.2.2 Current asset investments 550
2.2.3 Assigning purchase price to particular investments 550
2.3 Disclosure requirements 551
3 The requirements proposed by ED 55 554
3.1 Classification 555
3.2 Accounting requirements 556
3.2.1 Fixed asset investments 556
3.2.2 Current asset investments 557
3.2.3 Requirements for all investments 559
3.2.4 Income recognition 560
3.2.5 Redeemable interest bearing securities 560
3.2.6 Investments held for hedging purposes 561
3.2.7 Summary of main measurement rules 561
3.3 Disclosure requirements 562
4 Comparison with US and IASC pronouncements 563
4.1 US 563
4.2 IASC 563
4.2.1 IAS 25 563
4.2.2 E32 564
4.2.3 E40 564
CHAPTER 9 RESEARCH AND DEVELOPMENT 567
1 Introduction 567
1.1 Possible accounting treatments of research and development expenditure 567
1.1.1 Charge all costs to expense when incurred 567
1.1.2 Capitalise all costs when incurred 568
Detailed contents xxi
1.1.3 Capitalise costs when incurred if certain conditions are met 569
1.1.4 Accumulation of costs in a special category 569
1.1.5 Which treatment should be adopted? 569
1.2 Development of accounting standards in the UK 569
1.2.1 ED 14 569
1.2.2 ED 17 570
1.2.3 SSAP 13 570
1.2.4 ED 41 570
1.2.5 SSAP 13 (Revised) 571
2 Requirements of SSAP 13 571
2.1 Definitions 571
2.2 Accounting 572
2.2.1 Fixed assets 572
2.2.2 Pure and applied research 572
2.2.3 Development expenditure 573
2.3 Disclosure 574
2.4 Current reporting practice 574
3 Requirements of the Companies Act 1985 577
3.1 Accounting 577
3.2 Disclosure 577
3.2.1 Financial statements 577
3.2.2 Directors report 577
3.3 Distributable profits 578
4 Problem areas 579
4.1 What activities should be included within research and development? 579
4.2 What costs should be included within the category of research and
development? 580
4.3 Availability of choice between immediate write off and capitalisation of
development expenditure 580
4.4 Elimination of uncertainty in respect of development expenditure 581
4.4.1 Expenditure previously not capitalised 581
4.4.2 Deferred expenditure previously capitalised and subsequently
written down 581
5 Comparison with US and IASC pronouncements 581
5.1 US 581
5.2 IASC 582
XX11 Generally Accepted Accounting Practice in the United Kingdom
CHAPTER 10 CAPITALISATION OF BORROWING COSTS 587
1 Introduction 587
1.1 The development of the practice of capitalisation 587
1.2 Arguments for and against capitalisation 589
1.3 The accounting alternatives 590
1.3.1 Account for interest on debt as an expense of the period in
which it is incurred 591
1.3.2 Capitalise interest on debt as part of the cost of an asset when
prescribed conditions are met 591
1.3.3 Capitalise interest on debt and imputed interest on owners equity
in respect of qualifying assets during their production period 592
2 A comparison between the UK, US and IASC 592
2.1 The current UK position 592
2.1.1 ED 51 594
2.2 US 595
2.2.1 Qualifying and non-qualifying assets 595
2.2.2 Capitalisation rate 596
2.2.3 Capitalisation period 597
2.2.4 Disclosure 597
2.3 IASC 597
3 Issues arising in practice 601
3.1 Qualifying assets 601
3.2 Period of production 603
3.2.1 Commencement of capitalisation period 603
3.2.2 End of capitalisation period 605
3.2.3 Interruptions and delays during development 607
3.3 Determination of amount to be capitalised 607
3.3.1 Borrowings and capitalisation rate 607
3.3.2 Limitation on interest capitalised 611
3.3.3 Gross or net of tax relief 613
3.3.4 Compounding 613
3.3.5 Accrued costs 614
3.3.6 Asset not previously held at cost 614
3.4 Group financial statements 614
3.4.1 Borrowings in one company and development in another 614
3.4.2 Qualifying assets held by investments accounted for using the
equity method 615
3.5 Other issues 616
3.5.1 Provisions for diminution in value 616
3.5.2 Change of policy 617
Detailed contents xxiii
3.5.3 Exchange differences as a borrowing cost 618
3.5.4 Assets produced by others 618
3.5.5 Depreciation 619
3.5.6 Interest capitalisation and creative accounting 619
4 Disclosure 620
4.1 Balance sheet and related notes 620
4.2 Profit and loss account and related notes 620
4.3 Accounting policy 622
5 Conclusion 623
CHAPTER 11 STOCKS AND LONG-TERM CONTRACTS 627
1 Introduction 627
1.1 The importance of stocks and long-term contracts within financial statements...627
1.2 What are stocks and long-term contracts? 627
1.3 Objectives of stock measurement 628
2 Determining the cost of stock 629
2.1 Direct costing vs. full absorption costing 630
3 Determining the cost of sales 631
3.1 Cost flow assumptions based on the physical flow of goods 631
3.1.1 Specific identification/actual cost 631
3.1.2 FIFO (first-in, first-out) 632
3.2 Cost flow assumptions which disregard the physical flow of goods 633
3.2.1 Weighted average 633
3.2.2 LIFO (last-in, first-out) 633
3.2.3 Base stock 634
3.3 Illustration of the effect of different cost flow assumptions 635
4 The development of SSAP 9 (revised) 638
4.1 The original SSAP 9 638
4.2 The need for revision 639
4.3 SSAP 9 (Revised) 640
5 The requirements of the Companies Act 1985 640
5.1 Lower of cost and net realisable value 640
5.2 Stock included at a fixed amount 641
5.3 Determination of purchase price or production cost 641
5.4 Costing method and replacement cost 641
5.4.1 Most recent actual purchase price or production cost 644
5.5 Current cost 644
XXIV Generally Accepted Accounting Practice in the United Kingdom
6 Stocks 645
6.1 The accounting and disclosure requirements of SS AP 9 (Revised) 645
6.1.1 Suitable analysis of stocks 645
6.1.2 Accounting policies 647
6.2 Comparison with US and IASC pronouncements 648
6.2.1 US 648
6.2.2 IASC 649
6.3 Problem areas 650
6.3.1 Constituents of cost 650
6.3.2 Net realisable value 653
6.3.3 The valuation of high volumes of similar items of stock 656
6.3.4 Marking to market 657
7 Long-term contracts 658
7.1 The accounting and disclosure requirements of SS AP 9 (Revised) 658
7.1.1 Definition 658
7.1.2 Turnover, related costs and attributable profit 659
7.1.3 Accounting policies 660
7.1.4 The financial statement presentation of long-term contracts 661
7.1.5 Illustrative examples of the disclosure of long-term contracts 662
7.2 Comparison with US and IASC pronouncements 668
7.2.1 US 668
7.2.2 IASC 668
7.3 Problem areas 670
7.3.1 How much profit? 670
7.3.2 How much turnover? 671
7.3.3 Approved variations and claims 672
7.3.4 Should profits be accrued on short-term contracts? 673
7.3.5 Inclusion of interest 674
CHAPTER 12 CAPITAL INSTRUMENTS 677
1 Introduction 677
2 Progress towards an accounting standard 678
2.1 TR677 678
2.2 The ASB discussion paper 679
2.2.1 The distinction between debt and share capital 679
2.2.2 The disclosure of debt maturities 680
2.2.3 The measurement of interest expense and other costs 683
2.2.4 Proposed disclosure 684
2.3 Operating and Financial Review 685
¦
Detailed contents XXV
3 Companies Act and Stock Exchange requirements 689
3.1 The measurement of share and loan capital 689
3.1.1 Share capital 689
3.1.2 Loan capital 690
3.2 Disclosure requirements 691
3.2.1 Share capital 691
3.2.2 Loan capital 695
3.3 The purchase of a company s own shares 701
3.4 Scrip dividends 707
4 Accounting for particular types of instrument 711
4.1 Bonds with no rights to conversion 711
4.1.1 Stepped bonds 711
4.1.2 Deep discounted bonds 712
4.1.3 Bonds with variable interest rates or redemption payments 714
4.2 Share options and warrants 715
4.3 Convertible bonds 718
4.3.1 Traditional convertible bonds 718
4.3.2 Bonds with share warrants attached 720
4.3.3 Convertible bonds with premium puts 721
4.3.4 Convertible capital bonds 723
4.3.5 Perpetual debt 725
4.4 Preference shares 726
4.4.1 Redeemable preference shares 726
4.4.2 Convertible preference shares 728
4.5 Interest rate swaps 732
5 Comparison with US and IASC pronouncements 733
5.1 US 733
5.1.1 Share capital 733
5.1.2 Redeemable shares 734
5.1.3 Treasury stocks 735
5.1.4 Additional paid-in capital 735
5.1.5 Dividends 736
5.1.6 Debt 736
5.1.7 Convertible debt and debt issued with warrants 738
5.1.8 Convertible bonds with a Premium Put 738
5.1.9 Financial instruments project 738
5.2 IASC 739
6 Conclusion 741
XXVi Generally Accepted Accounting Practice in the United Kingdom
CHAPTER 13 OFF-BALANCE SHEET TRANSACTIONS 745
1 Introduction 745
1.1 What are off balance sheet transactions ? 745
1.2 Justifications for entering into off balance sheet transactions 745
1.3 Why the concern with off balance sheet transactions? 747
2 Progress towards an accounting standard 751
2.1 ICAEW Technical Release 603 751
2.2 ED 42 752
2.3 ED 49 754
2.4 ASB initiatives 757
2.4.1 Statement of Principles 757
2.4.2 Securitisation 758
3 Common forms of off balance sheet finance 759
3.1 Quasi subsidiaries 759
3.1.1 Off balance sheet transactions involving quasi subsidiaries 759
3.1.2 The definition of a subsidiary undertaking 765
3.1.3 ED 49 767
3.2 Consignment stocks 768
3.3 Sale and repurchase agreements 772
3.4 Factoring of debts 779
3.5 Securitised mortgages 782
3.6 Loan transfers 790
3.7 Take-or-pay contracts and throughput agreements 792
4 Current disclosure requirements affecting off balance sheet transactions 793
5 Comparison with US and IASC pronouncements 795
5.1 US 795
5.1.1 General 795
5.1.2 Quasi subsidiaries 795
5.1.3 Sale of assets 795
5.1.4 Long term obligations 796
5.1.5 Sales of real estate 796
5.1.6 Transfers of receivables with recourse 797
5.1.7 Financial instruments 798
5-2 IASC 800
6 Conclusion gOi
s
Detailed contents xxvii
CHAPTER 14 LEASES AND HIRE PURCHASE CONTRACTS 805
1 Introduction 805
1.1 What are leases and hire purchase contracts? 805
1.2 The tax position 806
1.3 SSAP21 806
1.4 Accounting requirements of SSAP 21 807
1.5 ICAEW review of SSAP 21 808
2 Determining the lease type 808
2.1 The 90% test 808
2.1.1 The fair value 809
2.1.2 The implicit interest rate 809
2.1.3 The minimum lease payments 809
2.1.4 An unguaranteed residual value 810
2.1.5 The lease term 810
2.2 90% test example 811
2.3 Determining the lease type — other factors 811
3 Accounting by lessees 814
3.1 Introduction 814
3.2 Capitalised fixed asset 814
3.3 Finance lease obligation 815
3.4 Methods of allocating finance charges to accounting periods 815
3.5 Carrying values 817
3.6 Operating leases 817
4 Disclosure by lessees 818
4.1 SSAP 21 requirements 818
4.2 Related Companies Act requirements 819
4.3 Disclosure in practice 820
5 Accounting by lessors 824
5.1 Introduction 824
5.2 Operating leases 824
5.3 Finance leases 825
5.4 Choice and disclosure of methods 825
5.5 Allocation of gross earnings — finance leases 826
5.5.1 Introduction 826
5.5.2 Methodology 826
5.5.3 Assumptions 829
5.5.4 Other methods 830
5.5.5 Net investment or net cash investment 830
S
XXV111 Generally Accepted Accounting Practice in the United Kingdom
5.6 Allocation of gross earnings — hire purchase contracts 831
5.6.1 Introduction 831
5.6.2 Methodology 831
5.6.3 Choice of method 832
6 Disclosure by lessors 832
6.1 SSAP 21 requirements 832
6.2 Related Companies Act requirements 833
6.3 Disclosure in practice 833
7 Problem areas 838
7.1 Classification of leases 838
7.1.1 Current practice 838
7.1.2 Leasing as an off balance sheet transaction 838
7.2 Termination of leases 840
7.2.1 Lease classification 840
7.2.2 Operating leases 841
7.2.3 Finance leases — lessee 841
7.2.4 Finance leases — lessor 842
7.3 Tax variation clauses 842
7.3.1 Introduction 842
7.3.2 Adjustments 842
7.3.3 Lessee 843
7.3.4 Lessor 843
7.4 Sale and leaseback transactions 843
7.4.1 Introduction 843
7.4.2 Finance or operating lease? 843
7.4.3 Leaseback under a finance lease 845 j
7.4.4 Leaseback under an operating lease 847 *
7.5 Income recognition by lessors 849
7.5.1 Initial direct costs 849
7.5.2 Residual values 850
7.6 Manufacturers/dealers 850
7.6.1 Introduction 850
7.6.2 Allocating the total profit of the manufacturer/dealer 851
7.7 Sub-leases and back-to-back leases 852
7.7.1 Introduction 852
7.7.2 The original lessor and the ultimate lessee 852
7.7.3 The intermediate party 852
8 Comparison with US and IASC pronouncements 854
8.1 US 854
8.2 IASC 855
9 Conclusion 856
Detailed contents xxix
CHAPTER 15 GOVERNMENT GRANTS 861
1 Introduction 861
2 The development of SSAP 4 (Revised) 861
2.1 The original SSAP 4 861
2.2 ED 43 862
2.3 SSAP 4 (Revised) 862
3 The requirements of SSAP 4 (Revised) 863
3.1 Accounting 863
3.1.1 Treatment of capital grants 863
3.1.2 Treatment of revenue-based grants 864
3.1.3 Accounting for receipt and repayment of grants 865
3.1.4 Matching grants against related expenditure 866
3.2 Disclosure 867
4 Problem areas 869
4.1 Achieving the most appropriate matching 869
4.1.1 Should the grant be split into its elements? 870
4.1.2 What was the purpose of the grant? 870
4.1.3 What is the period to be benefited by the grant? 870
4.1.4 Is a grant capital or revenue? 871
4.2 Capital grants on non-depreciating assets 871
5 Comparison with the IASC pronouncement 872
CHAPTER 16 SEGMENTAL REPORTING 873
1 Introduction 873
1.1 Historical background 873
1.2 The objectives of segmental reporting 874
1.2.1 Introduction 874
1.2.2 The shareholder group 874
1.2.3 The investment analyst group 874
1.2.4 The lender/creditor group 875
1.2.5 Government 875
2 The UK position 875
2.1 Legislative requirements 875
2.2 Stock Exchange requirements 876
2.3 SSAP 25 876
2.3.1 The origins of the standard 876
2.3.2 General approach 877
2.3.3 Scope 877
XXX Generally Accepted Accounting Practice in the United Kingdom
2.3.4 What is a reportable segment? 878
2.3.5 What is to be reported? 879
2.3.6 Associated undertakings 881
2.3.7 Common costs 885
2.3.8 Disclosure in practice 885
2.4 Voluntary segmental disclosures 890
3 Problem areas 893
3.1 How to define the segments 893
3.2 Inter-segment sales 899
3.3 Common costs 900
3.4 Allocation of interest income and interest expense 901
3.5 Exceptional items 904
3.6 Changes in composition of the group 906
3.7 How to define net assets 907
4 Comparison with US and IASC pronouncements 910
4.1 US 910
4.1.1 Introduction 910
4.1.2 SFAS 14 910
4.2 IASC 913
4.2.1 Introduction 913
4.2.2 IAS 14 913
5 Conclusion 914
CHAPTER 17 PENSION COSTS 917
1 Introduction 917
1.1 Background 917
1.2 The development of an accounting standard in the UK 918
1.2.1 Napier interim report 918
1.2.2 ED 32 920
1.2.3 Statement of Intent 921
1.2.4 ED 39 921
1.2.5 SSAP24 922
2 Requirements of SSAP 24 922
2.1 Scope 922
2.2 Accounting objective 923
2.3 Definition of terms 923
2.4 Defined contribution schemes 925
2.4.1 Accounting 925
2.4.2 Disclosure 926
Detailed contents XXXJ
2.5 Defined benefit schemes 926
2.5.1 Regular pension cost 927
2.5.2 Variations from regular cost 927
2.5.3 Discretionary and ex-gratia pension increases and ex-gratia
pensions 939
2.5.4 Balance sheet 939
2.5.5 Disclosure 946
3 The actuarial aspects of SSAP 24 953
3.1 Actuarial valuation methods 953
3.1.1 Background 953
3.1.2 The approach taken by the standard 955
3.1.3 Possible actuarial methods — accrued benefits methods 956
3.1.4 Possible actuarial methods — projected benefits methods 959
3.1.5 Actuarial valuation of assets 963
3.1.6 Conclusion 963
3.2 Actuarial assumptions and best estimates 963
3.3 The role of the actuary 964
4 Problem areas 965
4.1 The treatment of interest 965
4.2 Variations from regular cost 971
4.2.1 Calculation of remaining service lives 971
4.2.2 How should variations be amortised? 972
4.2.3 What is a significant reduction in employees? 976
4.2.4 Allocation of experience differences to funding consequences 976
4.2.5 How to account for the unamortised difference remaining in
the year of the next actuarial valuation 977
4.2.6 How to treat a balance sheet asset which is shown to have
been eroded by a subsequent valuation 979
4.3 Negative pension cost 980
4.4 Hybrid schemes 982
4.5 Foreign schemes 983
4.6 Unfunded schemes 983
4.7 Deferred tax 984
4.8 Post-retirement benefits other than pensions 986
4.9 Accounting for the pension schemes of an acquired subsidiary 989
4.10 Group schemes 990
4.11 Multi-employer schemes 991
5 Related Companies Act requirements 991
5.1 Pension commitments 991
5.2 Pension costs 992
5.3 Directors emoluments 992
XXXJi Generally Accepted Accounting Practice in the United Kingdom
6 Comparison with IASC and US pronouncements 993
6.1 IASC 993
6.1.1 IAS 19 993
6.1.2 E32 993
6.2 US 994
6.2.1 Background 994
6.2.2 SFAS 87 994
6.2.3 SFAS 88 995
6.2.4 SFAS 106 996
7 Conclusion 996
CHAPTER 18 TAXATION 1001
1 General principles 1001
1.1 The nature of taxation 1001
1.2 Allocation between periods 1002
1.2.1 Background 1002
1.2.2 Permanent differences 1002
1.2.3 Timing differences 1003
1.2.4 The deferral method 1005
1.2.5 The liability method (with full provision/comprehensive
allocation) 1008
1.2.6 The liability method (with partial provision) 1009
1.2.7 The hybrid method 1015
1.2.8 Discounting the liability 1016
1.2.9 The net of tax method 1017
1.2.10 The flow-through method 1017
1.3 Allocation within periods 1017
2 The development of accounting for taxation in the UK 1018
2.1 Accounting for tax payable 1018
2.1.1 ED 12 1018
2.1.2 SSAP 8 1019
2.2 Accounting for deferred tax 1019
2.2.1 ED 11 1019
2.2.2 SSAP 11 1019
2.2.3 ED 19 1020
2.2.4 SSAP 15 1020
2.2.5 ED 33 1021
2.2.6 SSAP 15 (Revised) 1022
Detailed contents xxxiii
2.3 Other ASC pronouncements 1022
2.3.1 SSAP 5 1022
2.3.2 ED 28 1022
3 The requirements of the relevant accounting standards and company law 1023
3.1 SSAP 8 1023
3.1.1 Outgoing dividends and the related ACT 1023
3.1.2 Recoverable ACT 1023
3.1.3 Incoming dividends 1025
3.1.4 Disclosure of the tax charge in the profit and loss account 1025
3.2 SSAP 15 1027
3.2.1 General approach 1027
3.2.2 Definitions 1028
3.2.3 Detailed accounting requirements 1028
3.2.4 Disclosure 1031
3.3 Companies Act 1985 1038
4 Problem areas 1040
4.1 Combining different categories of timing difference 1040
4.2 Tax losses and deferred tax 1042
4.2.1 Tax losses which have been incurred 1042
4.2.2 Tax losses which have yet to be incurred 1044
4.3 Tax losses and group relief 1045
4.3.1 Background 1045
4.3.2 The financial statements of the profitable company 1045
4.3.3 The financial statements of the loss-making company 1046
4.4 Tax in the financial statements of a group 1046
4.4.1 Offsetting consolidated tax balances 1046
4.4.2 Tax effects of consolidation adjustments 1049
4.5 ACT 1050
4.5.1 ACT carried forward as an asset 1050
4.5.2 ACT set against the deferred tax liability 1050
4.6 Changes in tax rates 1054
4.6.1 Corporation tax 1054
4.6.2 Deferred tax 1055
4.7 Revaluations of fixed assets 1056
4.8 Overseas earnings 1057
4.9 Deferred tax on fair value adjustments 1058
5 Comparison with US and IASC pronouncements 1059
5.1 IASC 1059
5.2 US 1059
5.2.1 APB 11 1059
5.2.2 SFAS 96 1060
XXXJV Generally Accepted Accounting Practice in the United Kingdom
5.2.3 SFAS 109 1061
5.2.4 Main differences between US and UK requirements 1063
6 Conclusion 1064
CHAPTER 19 REPORTING OF FINANCIAL PERFORMANCE 1067
1 The need for a standard 1067
1.1 Income measurement 1067
1.1.1 The all inclusive concept 1068
1.1.2 The current operating performance concept 1068
1.1.3 Which concept? 1069
1.2 The development of UK standards 1070
1.2.1 The original SSAP 6 1070
1.2.2 The revision of SSAP 6 1070
1.2.3 UITF2 1072
1.2.4 FRED 1 1072
2 The requirements of SSAP 6 (Revised) 1072
2.1 Identification of extraordinary and exceptional items 1072
2.1.1 Definitions 1072
2.1.2 Examples of exceptional and extraordinary items 1073
2.2 Terminated activities 1075
2.2.1 Identification of a business segment 1075
2.2.2 Items to be taken into account in evaluating the effect
of discontinuing a business segment 1077
2.2.3 Decision date and implementation date 1078
2.3 Tax attributable to extraordinary items 1078
2.4 Statement of movements on reserves 1079
2.5 Prior year adjustments 1080
2.5.1 Definition 1080
2.5.2 Identification of prior year adjustments 1080
2.5.3 Changes in accounting policy 1080
2.5.4 Correction of fundamental errors 1081
2.5.5 Accounting treatment 1081
2.6 Historical summaries, half-yearly reports and preliminary profit statements.... 1085
2.7 Exceptions from SSAP 6 1086
2.7.1 Reserve movements permitted or required by other accounting
standards 1086
2.7.2 Reserve movements permitted or required by law 1086
2.7.3 Value based companies 1087
Detailed contents XXXV
3 Disclosure requirements 1087
3.1 Profit and loss account format 1087
3.2 Extraordinary items 1088
3.3 Exceptional items 1089
3.4 Prior year adjustments 1091
3.5 Statement of movements on reserves 1091
4 Problem areas 1094
4.1 Definition of extraordinary items 1094
4.2 Terminated activities 1095
4.2.1 Definition of business segment 1095
4.2.2 Identification of decision date and implementation date 1096
4.2.3 Formerly discontinued operations which are resumed 1099
4.2.4 Finance costs associated with discontinued operations 1099
4.3 Restructuring costs 1102
4.4 Historical summaries, half-yearly reports and preliminary profits statements... 1103
5 FRED 1 1103
5.1 Introduction 1103
5.2 Discontinued operations 1105
5.3 The effect of acquisitions 1107
5.4 Extraordinary and exceptional items 1108
5.5 Revenue investment 1110
5.6 Statement of total recognised gains and losses 1110
5.7 Note of historical cost profits and losses 1111
6 Comparison with US, IASC and Canadian pronouncements 1112
6.1 US 1112
6.1.1 Extraordinary items 1112
6.1.2 Terminated activities (discontinued operations) 1113
6.1.3 Prior year adjustments 1114
6.2 IASC 1115
6.2.1 IAS 8 1115
6.2.2 E46 1115
6.3 Canada 1116
6.3.1 Infrequency of occurrence 1116
6.3.2 Normal business activities 1116
6.3.3 Decisions by management 1117
7 Conclusion 1117
xxxvi Generally Accepted Accounting Practice in the United Kingdom
CHAPTER 20 EARNINGS PER SHARE 1123
1 Introduction 1123
2 Scope of SSAP 3 1124
3 The basic EPS 1124
3.1 Definition of EPS 1124
3.2 Disclosure 1125
4 Changes in equity share capital 1126
4.1 Issue for cash at full market price 1126
4.2 Bonus issue and share split 1126
4.3 Rights issue 1128
4.4 Options exercised during the year 1131
4.5 Issue for cash at less than full market price 1132
4.6 Purchase and redemption of own shares 1132
4.7 Post-balance sheet changes in capital 1132
4.8 Issue to acquire another business 1133
4.9 Group reconstructions 1134
4.10 Adjustments to EPS in five year summaries 1135
5 Matters affecting the EPS calculation 1135
5.1 Earnings 1135
5.2 Preference dividends 1135
5.3 Losses 1136
5.4 Prior year adjustments 1136
5.5 Different classes of equity shares 1136
5.6 Net and nil bases 1137
5.6.1 Should EPS be calculated net or nil ? 1138
5.6.2 Calculation of nil basis EPS 1139
5.7 Other bases 1141
6 Fully diluted earnings per share 1146
6.1 The need for fully diluted EPS 1146
6.2 Disclosure of fully diluted EPS 1147
6.3 Calculation of fully diluted EPS 1148
6.3.1 Equity shares with future dividend entitlement 1148
6.3.2 Convertible securities 1149
6.3.3 Options or warrants to subscribe for equity shares 1151
6.3.4 Fully diluted EPS calculations involving more than one type of
potentially dilutive security 1153
6.3.5 Deferred consideration agreements 1154
7 FRED 1 1156
Detailed contents XXXvii
8 Comparison with US pronouncements 1157
8.1 The primary EPS 1157
8.2 Fully diluted EPS 1158
8.3 Disclosure 1158
CHAPTER 21 POST BALANCE SHEET EVENTS 1161
1 The development of accounting for post balance sheet events 1161
1.1 Introduction 1161
1.2 ICAEW Recommendation N17 1162
1.3 ED 22 1162
1.4 SSAP 17 1163
2 Requirements of SSAP 17 1163
2.1 Definitions 1163
2.2 Events requiring adjustment 1165
2.3 Events not requiring adjustment but requiring disclosure 1165
2.4 Disclosure requirements 1172
3 Problem areas 1174
3.1 Reclassification of a non-adjusting event as adjusting in exceptional
circumstances 1174
3.2 The valuation of stock realised after the balance sheet date 1175
3.3 Long-term contracts 1176
3.4 Acquisitions and disposals of fixed assets 1176
3.5 Window dressing 1177
3.6 Valuations of property 1178
3.7 Insolvency of a debtor 1178
4 Comparison with US and IASC pronouncements 1179
4.1 US 1179
4.2 IASC 1179
5 Conclusion 1180
CHAPTER 22 CONTINGENCIES 1183
1 The development of accounting for contingencies 1183
1.1 Introduction 1183
1.2 The historical background 1183
2 Requirements of SSAP 18 1184
2.1 Definition of contingency 1184
2.2 Contingent gains 1184
2.3 Contingent losses 1185
XXXViii Generally Accepted Accounting Practice in the United Kingdom
2.4 Offsets 1186
2.5 Groupings 1187
2.6 Disclosure requirements 1187
3 Problem areas 1187
3.1 Probable, possible or remote 1187
3.2 Estimating the amount of a contingency 1188
3.3 Disclosure of the financial effect of a contingency 1190
3.4 Litigation and disclosure of potentially prejudicial information 1194
3.5 Disclosure of remote contingencies 1195
3.6 Other problem areas 1197
3.6.1 Guarantees — year-end or maximum liability 1197
3.6.2 Discounted bills of exchange 1198
3.6.3 VAT groups 1199
3.6.4 Performance bonds 1199
4 Comparison with US and IASC pronouncements 1200
4.1 US 1200
4.2 IASC 1201
CHAPTER 23 CASH FLOW STATEMENTS 1203
1 The evolution of the cash flow statement 1203
1.1 Statements of source and application of funds 1203
1.2 The form and content of the funds statement 1204
1.3 The objectives of the SSAP 10 funds statement 1205
1.4 The funds statement and cash flows 1206
1.5 The distinction between funds flow under SSAP 10 and cash flow under
FRS 1 1207
2 The requirements of FRS 1 1210
2.1 Scope and exemptions 1210
2.2 Cash and cash equivalents 1214
2.3 Format of the cash flow statement 1216
2.4 Classification of cash flows by standard heading 1216
2.4.1 Operating activities 1216
2.4.2 Returns on investments and servicing of finance 1220
2.4.3 Taxation 1222
2.4.4 Investing activities 1224
2.4.5 Financing 1228
2.4.6 Exceptional and extraordinary items 1230
2.4.7 Interpretation of the standard headings 1231
2.5 Reconciliations 1232
2.6 Comparative figures 1234
Detailed contents XXxix
2.7 Groups 1234
2.7.1 Acquisitions and disposals of subsidiary undertakings 1235
2.7.2 Associated undertakings and equity accounted joint ventures 1238
2.8 Foreign currency 1238
2.8.1 Individual entity 1238
2.8.2 Groups 1239
2.8.3 Hedging transactions 1241
2.9 Non-cash transactions 1241
2.10 Notes to the cash flow statement 1242
3 Problem areas 1243
3.1 The definition of cash equivalents 1243
3.2 The definition of cash flows from operating activities 1246
3.2.1 Acquisition provisions 1247
3.2.2 Extraordinary items 1248
3.3 Cash which is subject to restriction 1249
3.4 Commercial paper issued by the reporting entity 1249
3.5 Revolving credit 1250
3.6 Deferred development expenditure 1250
3.7 Cash earnings per share 1251
4 Comparison with US and IASC requirements 1252
4.1 US 1252
4.1.1 Introduction 1252
4.1.2 Focus of SFAS 95 1253
4.1.3 Cash equivalents 1254
4.1.4 Form and content of the statement of cash flows 1254
4.1.5 Investing activities 1254
4.1.6 Financing activities 1255
4.1.7 Operating activities 1256
4.1.8 Receipts and payments are presented gross 1256
4.1.9 Non-cash activities are disclosed separately 1257
4.1.10 Choice of using the direct or indirect methods 1257
4.1.11 Illustrative examples 1258
4.2 Summary of principal differences between FRS 1 and SFAS 95 1261
4.3 IASC 1263
5 Conclusion 1264
XI Generally Accepted Accounting Practice in the United Kingdom
CHAPTER 24 RELATED PARTIES 1269
1 Introduction 1269
1.1 The related party issue 1269
1.2 Possible solutions 1270
1.2.1 Remeasurement of transactions at fair values 1270
1.2.2 Disclosure of transactions 1270
1.3 Position in the UK 1271
2 ED 46 1272
2.1 Introduction 1272
2.2 Identification of related parties 1272
2.3 Types of transactions and arrangements 1273
2.4 Information to be disclosed 1274
2.4.1 Abnormal transactions 1274
2.4.2 Controlling relationship 1275
2.4.3 Economic dependence 1275
2.4.4 Specific exemptions from disclosure 1276
2.4.5 Disclosure in practice 1276
3 Problem areas 1278
3.1 Identification of related parties 1278
3.1.1 Control or significant influence 1278
3.1.2 Controlled or significantly influenced parties 1278
3.1.3 Controlling or significantly influencing parties 1279
3.1.4 Enterprises under common control or significant influence 1283
3.1.5 Economic dependence 1285
3.1.6 Conclusion 1286
3.2 Types of transactions and arrangements 1287
3.2.1 Introduction 1287
3.2.2 Normal/abnormal transactions 1287
4 Other requirements in the UK 1290
4.1 Legislative requirements 1290
4.1.1 Directors 1290
4.1.2 Non-director officers 1290
4.1.3 Related undertakings 1291
4.2 UK accounting standards 1295
4.3 Stock Exchange requirements 1296
4.3.1 Directors 1296
4.3.2 Shareholders 1297
Detailed contents xli
5 Comparison with US and IASC pronouncements 1298
5.1 IASC 1298
5.1.1 IAS 24 1298
5.2 US 1299
5.2.1 SFAS 57 1299
6 Conclusion 1300
CHAPTER 25 DIRECTORS AND OFFICERS LOANS AND
TRANSACTIONS 1303
1 Introduction 1303
1.1 Outline of historical development in the UK 1303
2 Definitions 1304
2.1 Director 1304
2.2 Shadow director 1304
2.3 Alternate director 1304
2.4 Connected person 1304
2.5 Officer 1306
2.6 Loan 1306
2.7 Quasi-loan 1306
2.8 Credit transaction 1307
3 Disclosure requirements 1308
3.1 Introduction 1308
3.2 Scope 1308
3.3 Transactions requiring disclosure 1310
3.4 Section 330 transactions 1311
3.4.1 Introduction 1311
3.4.2 Disclosure requirements 1311
3.5 Material interest transactions 1317
3.5.1 Introduction 1317
3.5.2 Definition of material interest 1317
3.5.3 Disclosure requirements 1318
3.6 Exemptions from disclosure 1324
3.6.1 General 1324
3.6.2 Section 330 transactions 1324
3.6.3 Material interest transactions 1324
4 Banking companies under the Banking Act 1987 1325
4.1 Disclosure of transactions by banking companies 1326
Xlii Generally Accepted Accounting Practice in the United Kingdom
5 Requirements of The Stock Exchange 1326
5.1 Listed companies 1326
5.2 USM companies 1327
6 Transactions involving officers 1328
6.1 Introduction 1328
6.2 Disclosure requirements 1328
6.3 Banking companies under the Banking Act 1987 1329
7 Conclusion 1329
APPENDIX: LEGAL REQUIREMENTS 1331
A Introduction 1331
B Prohibited transactions 1331
B.I Loans 1331
B.2 Quasi-loans and credit transactions 1331
B.3 Assignment/assumption of rights, obligations or liabilities 1331
B.4 Arrangements 1332
C Exempted transactions 1332
C.I Loans of small amounts 1332
C.2 Short-term quasi-loans 1332
C.3 Minor or business credit transactions 1332
C.4 Inter-company transactions 1333
C.5 Directors business expenditure 1333
C.6 Money-lending companies 1333
C.7 Companies registered overseas 1334
D Sanctions 1334
D.I Civil remedies 1334
D.2 Criminal penalties 1334
E Interests in contracts 1335
F Substantial property transactions 1336
G Transactions involving officers 1337
CHAPTER 26 DIRECTORS REMUNERATION 1343
1 Introduction 1343
1.1 Remuneration 1343
1.2 Pensions 1344
1.3 Compensation for loss of office 1344
1.4 Service contracts 1344
2 Disclosure of remuneration 1345
2.1 Introduction 1345
Detailed contents xim
2.2 Disclosure of aggregate emoluments 1346
2.2.1 Legal requirements 1346
2.2.2 Problem areas 1348
2.3 Definition of emoluments 1350
2.3.1 Legal requirements 1350
2.3.2 Problem areas 1350
2.4 Computing aggregate emoluments 1356
2.4.1 Legal requirements 1356
2.4.2 Problem areas 1361
2.5 Bandings 1363
2.6 Emoluments waived 1366
2.7 Pensions of directors and past directors 1368
2.8 Compensation for loss of office 1370
2.8.1 Legal requirements 1370
2.8.2 Problem areas 1373
2.9 Payments to third parties 1375
3 Employee disclosures 1376
3.1 Director as an employee 1376
4 Current developments 1376
4.1 Voluntary disclosures 1376
4.2 Cadbury report 1382
APPENDIX SPECIMEN FINANCIAL STATEMENTS 1387
Introduction 1387
Good Practice Limited 1389
Good Group P.L.C 1411
Good Group P.L.C. - Summary Financial Statement 1453
INDEX OF EXTRACTS FROM ACCOUNTS 1459
INDEX 1465
List of chapters
( 1 /The development of UK GAAP 1
C TS The quest for a conceptual framework for financial reporting 29
(^3j) Revenue recognition 99
4 Group financial statements 143
5 Foreign currencies 313
6 Fixed assets and depreciation 437
7 Investment properties 525
8 Investments 545
9 Research and development 567
10 Capitalisation of borrowing costs 587
11 Stocks and long term contracts 627
12 Capital instruments 677
13 Off balance sheet transactions 745
14 Leases and hire purchase contracts 805
15 Government grants 861
16 Segmental reporting 873
17 Pension costs 917
18/ Taxation 1001
19 ) Reporting of financial performance 1067
20 Earnings per share 1123
21 Post balance sheet events 1161
22 Contingencies 1183
23 Cash flow statements 1203
24 Related parties 1269
25 Directors and officers loans and transactions 1303
26 Directors remuneration 1343
Appendix: Specimen financial statements 1387
Index of extracts from accounts 1459
Index 1465
Detailed contents
CHAPTER 1 THE DEVELOPMENT OF UK GAAP 1
1 What is UK GAAP? 1
1.1 Principles or practice ? 1
1.2 What is generally accepted ? 2
2 Accounting standards and the concept of true and fair 3
2.1 The introduction of the true and fair concept 3
2.2 The interaction of accounting standards and the law 4
2.3 The role of International Accounting Standards 6
2.4 The experience of other countries 7
2.4.1 US 7
2.4.2 Canada 8
2.4.3 Germany 9
3 The development of Accounting Standards 10
3.1 The Accounting Standards Committee 10
3.1.1 The creation of the ASC 10
3.1.2 The objects and terms of reference of the ASC 11
3.1.3 The Watts Report 11
3.1.4 The McKinnon Report 12
3.1.5 The Dearing Report 12
3.1.6 The implementation of the Dearing proposals 15
3.2 The Accounting Standards Board 16
4 GAAP for small companies 17
4.1 The Big GAAP/Little GAAP debate 17
4.2 Exemptions for small companies 18
4.3 What is the small company solution? 19
5 Summary financial statements 20
5.1 The required form of a summary financial statement 20
5.2 Commentary 25
6 Conclusion 26
viii Generally Accepted Accounting Practice in the United Kingdom
CHAPTER 2 THE QUEST FOR A CONCEPTUAL FRAMEWORK
FOR FINANCIAL REPORTING 29
1 Introduction 29
1.1 What is a conceptual framework? 29
1.2 Why is a conceptual framework necessary? 29
1.3 Early attempts to establish a framework 31
2 The AICPA s initiatives in the United States 32
2.1 Accounting Research Studies 32
2.2 APB Statement No. 4 34
2.3 The Wheat and Trueblood Committees 34
3 The FASB Conceptual Framework 35
3.1 Introduction 35
3.2 The objectives of financial reporting 37
3.3 The qualitative characteristics of accounting information 39
3.3.1 The decision makers 40
3.3.2 The cost/benefit constraint 40
3.3.3 Understandability 41
3.3.4 Relevance and reliability 41
3.3.5 Comparability 43
3.3.6 Materiality 43
3.3.7 Conservatism 44
3.4 The elements of financial statements 44
3.4.1 Assets 44
3.4.2 Liabilities 45
3.4.3 Equity 46
3.4.4 Investments by owners 46
3.4.5 Distributions to owners 46
3.4.6 Comprehensive income 46
3.4.7 Revenues, expenses, gains and losses 47
3.5 Recognition and measurement 48
3.6 Conclusion 49
4 UK initiatives 50
4.1 SSAP 2: Disclosure of accounting policies 50
4.1.1 Fundamental accounting concepts 50
4.1.2 Accounting bases 51
4.1.3 Accounting policies 52
4.2 The Corporate Report 52
4.3 The Sandilands Report 55
4.3.1 Current Purchasing Power accounting 55
4.3.2 Value accounting 56
Detailed contents ix
4.3.3 Cash flow accounting 59
4.3.4 Current cost accounting (CCA) 61
4.4 The Macve Report 64
4.5 The Stamp Report 66
4.6 The ICAS discussion document: Making Corporate Reports Valuable 67
4.6.1 Background to the study 67
4.6.2 Users and their needs 68
4.6.3 Valuation of assets and liabilities 69
4.6.4 The proposed new information package 70
4.6.5 Additional information 71
4.6.6 Conclusion 72
4.7 The Solomons Report 72
4.8 The Future Shape of Financial Reports 77
5 The ASB s Statement of Principles 78
5.1 Introduction 78
5.2 The objective of financial statements 79
5.3 The qualitative characteristics of financial information 79
5.4 The elements of financial statements 80
5.4.1 Assets 80
5.4.2 Liabilities 80
5.4.3 Equity 81
5.4.4 Gains 81
5.4.5 Losses 81
5.4.6 Contributions from owners 81
5.4.7 Distributions to owners 81
5.4.8 The overall approach 81
5.5 The recognition of items in financial statements 82
5.6 Presentation of financial information 85
5.7 Conclusion 85
6 Other International framework projects 85
6.1 The IASC conceptual framework 86
6.2 The CICA financial statement concepts 88
6.3 The Australian framework project 88
6.4 The New Zealand framework project 89
7 Conclusion 91
X Generally Accepted Accounting Practice in the United Kingdom
CHAPTER 3 REVENUE RECOGNITION 99
1 The nature of revenue 99
2 Realised profits 100
3 The timing of revenue recognition 102
3.1 The critical event approach 103
3.1.1 The recognition of revenue at the completion of production 103
3.1.2 The recognition of revenue at the time of sale 104
3.1.3 The recognition of revenue subsequent to delivery 106
3.2 The accretion approach 107
3.2.1 The use by others of enterprise resources 107
3.2.2 Long term contracts 108
3.2.3 Natural growth 108
3.3 The revenue allocation approach 108
4 Fundamental recognition criteria 109
4.1 ASB Draft Statement of Principles Chapter 4: The recognition of items in
financial statements 109
4.1.1 The gain is earned Ill
4.1.2 The gain is realised Ill
4.1.3 The potential impact of the ASB s proposals on the recognition
of gains 112
4.2 IAS 18 113
4.2.1 The sale of goods 114
4.2.2 The rendering of services 115
4.2.3 The use by others of enterprise resources 116
4.2.4 Exposure draft E41 117
4.3 Canada 118
4.4 The US 118
4.4.1 The general rule 118
4.4.2 SFAC No. 5 119
4.4.3 FASB statements 120
4.5 Summary 120
5 Problem areas 122
5.1 Receipt of initial fees 122
5.1.1 Franchise fees 122
5.1.2 Advance royalty/licence receipts 125
5.1.3 Loan arrangement fees 126
5.1.4 Commitment fees 127
5.1.5 Credit card fees 127
5.2 Goods sold subject to reservation of title 1
Detailed contents xi
5.4 Advertising revenue 129
5.5 Software revenue recognition 130
5.5.1 Software licenses with no significant vendor obligations 130
5.5.2 Products sold with significant vendor obligations 131
5.5.3 Post delivery customer support services 133
5.5.4 Data services 134
5.6 The disposal of land and buildings 135
5.7 Film exhibition rights 137
5.8 Sale and leaseback transactions 138
6 Conclusion 139
CHAPTER 4 GROUP FINANCIAL STATEMENTS 143
1 The concept of a group 143
1.1 The objectives of group financial statements 143
1.2 What is a subsidiary? 144
1.2.1 The EC Seventh Directive 144
1.2.2 The Companies Act 145
1.2.3 The approach used in other countries 152
1.3 Consolidating partly owned subsidiaries 153
1.3.1 The entity concept 153
1.3.2 The proprietary concept 153
1.3.3 Comparison between the different concepts of a group 154
1.3.4 ED 50 and FRS 2 155
1.4 Principles of business combinations 157
2 Historical development of rules on group financial statements 158
2.1 Origins of group financial statements 158
2.2 The UK legislative background 158
2.3 Accounting standards in the UK 158
3 Consolidation of subsidiaries 159
3.1 Basic principles 159
3.2 Uniform accounting policies 160
3.3 Coterminous accounting periods 161
3.4 Elimination of unrealised profits/losses on inter company transactions 162
4 Exemptions from preparing group financial statements 163
4.1 Intermediate holding companies 163
4.2 Small and medium sized groups 166
4.3 Exemptions contained in FRS 2 167
Xll Generally Accepted ^counting practice in the United Kingdom
5 Exclusion of subsidiaries from group financial statements 168
5.1 Sources of rules on exclusion of f)af^cular subsidiaries 168
5.2 Different activities ....... 169
5.3 Operating under severe restrictions .. 172
5.4 Held for subsequent resale ...... 175
5.5 General disclosure requirements in r iSj?ect of excluded subsidiaries 176
6 Equity accounting 177
6.1 Introduction 177
6.2 The definition of an associate ...... 178
6.2.1 SSAP 1 ...... 178
6.2.2 The Companies Act 1985 179
6.2.3 ED 50 179
6.2.4 IAS 28 180
6.3 The accounting treatment of associate* •• 180
6.4 Other particular issues 182
6.4.1 Non coterminous periods ... 182
6.4.2 Deficiency of assets.. 184
6.4.3 Investor not preparing gr^up financial statements 184
6.4.4 Joint ventures ...... 186
6.4.5 Loss of associate status, •¦ 189
6.4.6 Elimination of unrealisecj Profits on transactions with associates... 190
6.5 Disclosure requirements regarding i»sSoCiates... 192
6.5.1 Profit and loss account. ... 192
6.5.2 Balance sheet ,.,. . 193
6.5.3 Notes ... 193
6.5.4 Acquisitions/Disposals. •. ... 195
6.5.5 Stock Exchange requirements....... 195
6.5.6 Proportionately consolidate joint ventures 196
7 Business combinations .... 297
7.1 Introduction , 297
7.1.1 ED 3 ... . .... . l97
7.1.2 Merger relief ....... .... 198
7 l 3 ED31 .. .... ZZZZZZZZZ.2O0
7.1.4 SSAP 23 201
7.1.5 Companies Act 1989 202
7.1.6 ED48 205
7.1.7 IAS 22 ....... .^ Z.ZZZZZZ. . 207
7.2 Acquisitions: basic principles ....... 207
7.3 Acquisitions: measuring the fair v^e of the consideration 208
7.3.1 Securities 209
7.3.2 Monetary items .,. .. , 211
Detailed contents A1I1
7.3.3 Non monetary items 211
7.3.4 Deferred consideration 212
7.3.5 Contingent consideration 212
7.3.6 Acquisition costs 216
7.3.7 Pre acquisition dividends 216
7.4 Acquisitions: measuring the fair value of the net assets acquired 217
7.4.1 Basic principles 217
7.4.2 The use of hindsight 219
7.4.3 Proposed requirements for individual assets and liabilities 220
7.4.4 Subsequent amendments to fair value 229
7.4.5 Push down accounting 234
7.5 Acquisitions: accounting for goodwill 235
7.5.1 Introduction 235
7.5.2 Immediate write off: which reserve? 238
7.5.3 Effect on realised profits of writing off goodwill 247
7.5.4 Amortisation 249
7.5.5 Negative goodwill 252
7.6 Step by step acquisitions 255
7.6.1 Background 255
7.6.2 Example 255
7.6.3 FRS 2 requirements 259
7.7 Mergers 262
7.7.1 Basic principles 262
7.7.2 Equity eliminations 262
7.7.3 Expenses of the merger 264
7.7.4 Non coterminous accounting periods 265
7.7.5 Dividends of the subsidiary 267
7.8 Disclosure requirements relating to business combinations 267
7.8.1 General 267
7.8.2 Acquisitions 267
7.8.3 Mergers 277
7.8.4 Transactions involving merger relief 280
7.8.5 Companies Act 280
8 Disposals 283
8.1 Basic principles 283
8.2 Effective date of disposal 283
8.3 Goodwill of subsidiaries disposed of 285
8.4 Partial disposals 289
8.5 Deemed disposals 291
8.6 Disclosure requirements relating to disposals 292
9 Group reorganisations 294
XIV Generally Accepted Accounting Practice in the United Kingdom
9.1 Introduction 294
9.2 Setting up a new top holding company 294
9.3 Changing direct ownership of a company within a group 296
9.3.1 Subsidiary moved up 296
9.3.2 Subsidiary moved along 298
9.3.3 Subsidiary moved down 298
9.4 Divisionalisation of an existing group 301
9.5 Demergers 301
9.6 Capital contributions 304
9.6.1 Treatment in the financial statements of the paying company 304
9.6.2 Treatment in the financial statements of the receiving company 304
10 Conclusion 305
CHAPTER 5 FOREIGN CURRENCIES 313
1 The development of an accounting standard in the UK 313
1.1 Background 313
1.2 SSAP6 314
1.3 ED 16 314
1.4 ED 21 315
1.5 ED 27 315
1.6 SSAP 20 316
2 Requirements of SSAP 20 316
2.1 Objectives of translation 316
2.2 Definitions of terms 316
2.3 Individual companies 317
2.3.1 Recording of transactions 318
2.3.2 Retranslation of monetary/non monetary assets and liabilities at
balance sheet date 318
2.3.3 Treatment of exchange differences 318
2.3.4 Worked examples 318
2.3.5 Examples of accounting policies 319
2.3.6 Exchange gains where there are doubts as to convertibility or
marketability 319
2.3.7 Foreign equity investments financed by borrowings 320
2.3.8 Forward contracts 321
2.4 Consolidated accounts 322
2.4.1 Scope 322
2.4.2 Choice of method 322
2.4.3 Closing rate/net investment method 322
2.4.4 Temporal method 326
X
Detailed contents XV
2.4.5 Foreign equity investments financed by borrowings 330
2.4.6 Associated companies 335
2.4.7 Foreign branches 335
2.5 Disclosures 336
2.5.1 Requirements of SSAP 20 336
2.5.2 Examples of disclosures 337
3 Problem areas 339
3.1 Individual companies 339
3.1.1 Date of transaction 339
3.1.2 Use of average rate 340
3.1.3 Dual rates or suspension of rates 341
3.1.4 Monetary or non monetary 342
3.1.5 Treatment of exchange differences 346
3.2 Exchange gains on long term monetary items 348
3.2.1 In what circumstances do doubts as to convertibility or
marketability arise? 348
3.2.2 Past exchange losses 349
3.2.3 Settled or unsettled transactions 349
3.2.4 Current portion of long term item 349
3.2.5 Restriction of gain 350
3.3 Forward contracts, currency swaps and currency options 350
3.3.1 Forward contracts 350
3.3.2 Currency swaps 359
3.3.3 Currency options 360
3.3.4 Current reporting practice 363
3.4 Consolidated accounts — closing rate/net investment method 364
3.4.1 Subsidiary with non coterminous year end 364
3.4.2 Dual rates or suspension of rates 365
3.4.3 Calculation of average rate 366
3.4.4 Change from closing rate to average rate or vice versa 369
3.4.5 Which reserve should exchange differences be taken to? 371
3.4.6 Post acquisition capital or revaluation reserves 371
3.4.7 Treatment of exchange differences on disposal of subsidiary 375
3.4.8 Change from closing rate/net investment method to temporal
method or vice versa 377
3.4.9 Hyperinflation 378
3.4.10 Goodwill on consolidation 381
3.4.11 Inter period comparisons 382
3.4.12 Branches 385
3.5 Cover method 385
3.5.1 What are foreign currency borrowings ? 385
3.5.2 Borrowings taken out before or after the investment 386
XVJ Generally Accepted Accounting Practice in the United Kingdom
3.5.3 Repayment of borrowings 389
3.5.4 Goodwill on consolidation 391
3.5.5 All investments/borrowings? 394
3.5.6 Must currencies be the same? 395
3.5.7 Pooled basis? 399
3.5.8 What is meant by condition (b) of paragraph 51 and
condition (c) of paragraph 57? 401
3.5.9 What should happen in the year of change of the above
conditions not being met? 403
3.6 Intra group long term loans and deferred trading balances 406
3.6.1 General requirement 406
3.6.2 Paragraphs 20 and 43 407
3.6.3 How permanent is permanent? 407
3.6.4 What happens in year of change? 408
3.6.5 Is such a treatment allowed in the company financial statements?. .410
3.6.6 If so, how should loans be translated? 411
3.6.7 UK subsidiary with loan from overseas parent company 412
3.7 Other intra group transactions 412
3.7.1 Dividends 413
3.7.2 Unrealised profits 414
4 Main criticisms of SSAP 20 and suggested solutions 415
4.1 Forward contracts and similar hedging contracts 415
4.1.1 Criticisms 415
4.1.2 Solution 416
4.2 Cover method 416
4.2.1 Criticisms 416
4.2.2 Solution 417
4.3 Reserve accounting 418
4.3.1 Criticism 418
4.3.2 Solution 418
4.4 Conclusion 419
5 Related Companies Act requirements 419
5.1 Realised profits 419
5.1.1 Schedule 4, paragraph 12 419
5.1.2 Section 262(3) 419
5.1.3 Settled transactions 420
5.1.4 Short term monetary items 420
5.1.5 Long term monetary items 420
5.2 Distributable profits 422
5.2.1 Section 263(3) 422
5.2.2 Long term monetary items 422
Detailed contents xvii
5.2.3 Section 275 and Schedule 4, paragraph 89 422
5.2.4 Cover method 423
5.2.5 Branch accounting 424
5.3 Disclosure 425
5.3.1 Basis of translation 425
5.3.2 Treatment of exchange differences in profit and loss account 426
5.3.3 Reserve movements 426
5.3.4 Movements on provisions for liabilities and charges 427
5.3.5 Movements on fixed assets 427
5.4 Alternative accounting rules 427
5.4.1 Schedule 4, Part II, section C 427
5.4.2 SSAP 20, paragraph 66 428
6 Comparison with US and IASC pronouncements 428
6.1 US 428
6.1.1 General comment 428
6.1.2 Main differences 428
6.2 IASC 430
6.2.1 Cover method 431
6.2.2 Forward exchange contracts 431
6.2.3 Disclosure 431
6.2.4 Proposed revisions to IAS 21 431
^CHAPTER 6 FIXED ASSETS AND DEPRECIATION 437
1 Introduction 437
1.1 Background 437
1.2 The meaning of fixed assets 438
1.3 Criteria for recognition of fixed assets 439
1.3.1 General criteria 439
1.3.2 Criteria for intangible fixed assets 439
1.3.3 The brands debate: which intangible assets are capable of being
accounted for? 445
2 Cost 448
2.1 Basic requirement 448
2.2 Purchase price 448
2.3 Production cost 449
2.4 Directly and indirectly attributable costs 450
2.5 The period of production 451
2.6 Abnormal costs and cost inefficiencies 452
2.7 Improvements and repairs 453
XVJii Generally Accepted Accounting Practice in the United Kingdom
3 Depreciation 454
3.1 Introduction 454
3.2 Arguments against depreciation 455
3.3 The requirements of the Companies Act 462
3.4 SSAP 12 462
3.4.1 Scope 462
3.4.2 Definitions 463
3.4.3 Accounting treatment 463
3.4.4 Asset lives 463
3.4.5 Permanent diminutions 464
3.4.6 Change in method 464
3.4.7 Depreciation on revalued assets 464
3.4.8 Depreciation on land and buildings 464
3.5 Useful economic life 464
3.6 Residual values 466
3.7 Depreciation methods 467
3.7.1 Straight line method 467
3.7.2 Reducing balance method 468
3.7.3 Other reducing balance methods 469
3.7.4 Annuity method 470
3.7.5 Unit of production method 471
3.8 Changes in method of providing depreciation 472
3.9 Changes in estimated life 472
3.10 Treatment of minor items 474
4 Permanent diminutions 475
4.1 Introduction 475
4.2 Companies Act requirements 475
4.3 SSAP 12 and permanent diminutions 475
4.4 The estimation of recoverable amount 476
4.5 Diminutions in value of individual assets or portfolio of assets 477
5 Revaluations 478
5.1 Introduction 478
5.1.1 Background 478
5.1.2 ED 51 479
5.2 Bases of valuation 481
5.2.1 General principles 481
5.2.2 Open market value of land and buildings 485
5.2.3 Depreciated replacement cost of land and buildings 489
5.2.4 Valuations of other assets 490
5.2.5 The comparability of valuations 490
Detailed contents Xix
5.3 Accounting for revaluations 491
5.3.1 Accounting for revaluation surpluses 491
5.3.2 Depreciation of revalued assets 493
5.3.3 Disposal of revalued assets 495
5.3.4 Downward valuations and provisions for permanent impairment... .498
5.3.5 Other uses of the revaluation reserve 501
5.3.6 Distributable profits and revaluations of fixed assets 502
6 Disclosure 504
6.1 Introduction 504
6.2 Directors report 504
6.3 Balance sheet and profit and loss account 506
6.4 Accounting policies 507
6.5 Notes to the financial statements 509
6.6 Additional disclosures for items carried at valuation 511
7 Comparison with US and IASC 515
7.1 US 515
7.2 IASC 517
8 Conclusion 518
CHAPTER 7 INVESTMENT PROPERTIES 525
1 The development of an accounting standard in the UK 525
2 The requirements of SSAP 19 526
2.1 Definition of investment property 526
2.2 Balance sheet valuation 527
2.3 Revaluation reserve 527
2.4 Disclosure 527
3 Issues arising from SSAP 19 528
3.1 Relevant Companies Act requirements 528
3.1.1 Disclosure on use of true and fair override 528
3.1.2 Diminutions in value 528
3.1.3 Revaluation reserve 530
3.1.4 Balance sheet classification 531
3.2 Frequency of independent valuation 532
4 Comparison with US and IASC pronouncements 532
4.1 US 532
4.2 IASC 532
5 Issues specific to property companies 533
5.1 Profit and loss account presentation 533
5.2 Rectifications from investment property to trading property 537
^XX Generally Accepted Accounting Practice in the United Kingdom
5.3 Reclassifications from trading property to investment property 538
5.4 Turnover definition 540
5.5 Revenue recognition 541
5.6 Lessee accounting 541
6 Conclusion 541
CHAPTER 8 INVESTMENTS 545
1 Introduction 545
2 The requirements of the Companies Act 547
2.1 Classification 547
2.2 Accounting rules 548
2.2.1 Fixed asset investments 548
2.2.2 Current asset investments 550
2.2.3 Assigning purchase price to particular investments 550
2.3 Disclosure requirements 551
3 The requirements proposed by ED 55 554
3.1 Classification 555
3.2 Accounting requirements 556
3.2.1 Fixed asset investments 556
3.2.2 Current asset investments 557
3.2.3 Requirements for all investments 559
3.2.4 Income recognition 560
3.2.5 Redeemable interest bearing securities 560
3.2.6 Investments held for hedging purposes 561
3.2.7 Summary of main measurement rules 561
3.3 Disclosure requirements 562
4 Comparison with US and IASC pronouncements 563
4.1 US 563
4.2 IASC 563
4.2.1 IAS 25 563
4.2.2 E32 564
4.2.3 E40 564
CHAPTER 9 RESEARCH AND DEVELOPMENT 567
1 Introduction 567
1.1 Possible accounting treatments of research and development expenditure 567
1.1.1 Charge all costs to expense when incurred 567
1.1.2 Capitalise all costs when incurred 568
Detailed contents xxi
1.1.3 Capitalise costs when incurred if certain conditions are met 569
1.1.4 Accumulation of costs in a special category 569
1.1.5 Which treatment should be adopted? 569
1.2 Development of accounting standards in the UK 569
1.2.1 ED 14 569
1.2.2 ED 17 570
1.2.3 SSAP 13 570
1.2.4 ED 41 570
1.2.5 SSAP 13 (Revised) 571
2 Requirements of SSAP 13 571
2.1 Definitions 571
2.2 Accounting 572
2.2.1 Fixed assets 572
2.2.2 Pure and applied research 572
2.2.3 Development expenditure 573
2.3 Disclosure 574
2.4 Current reporting practice 574
3 Requirements of the Companies Act 1985 577
3.1 Accounting 577
3.2 Disclosure 577
3.2.1 Financial statements 577
3.2.2 Directors report 577
3.3 Distributable profits 578
4 Problem areas 579
4.1 What activities should be included within research and development? 579
4.2 What costs should be included within the category of research and
development? 580
4.3 Availability of choice between immediate write off and capitalisation of
development expenditure 580
4.4 Elimination of uncertainty in respect of development expenditure 581
4.4.1 Expenditure previously not capitalised 581
4.4.2 Deferred expenditure previously capitalised and subsequently
written down 581
5 Comparison with US and IASC pronouncements 581
5.1 US 581
5.2 IASC 582
XX11 Generally Accepted Accounting Practice in the United Kingdom
CHAPTER 10 CAPITALISATION OF BORROWING COSTS 587
1 Introduction 587
1.1 The development of the practice of capitalisation 587
1.2 Arguments for and against capitalisation 589
1.3 The accounting alternatives 590
1.3.1 Account for interest on debt as an expense of the period in
which it is incurred 591
1.3.2 Capitalise interest on debt as part of the cost of an asset when
prescribed conditions are met 591
1.3.3 Capitalise interest on debt and imputed interest on owners equity
in respect of qualifying assets during their production period 592
2 A comparison between the UK, US and IASC 592
2.1 The current UK position 592
2.1.1 ED 51 594
2.2 US 595
2.2.1 Qualifying and non qualifying assets 595
2.2.2 Capitalisation rate 596
2.2.3 Capitalisation period 597
2.2.4 Disclosure 597
2.3 IASC 597
3 Issues arising in practice 601
3.1 Qualifying assets 601
3.2 Period of production 603
3.2.1 Commencement of capitalisation period 603
3.2.2 End of capitalisation period 605
3.2.3 Interruptions and delays during development 607
3.3 Determination of amount to be capitalised 607
3.3.1 Borrowings and capitalisation rate 607
3.3.2 Limitation on interest capitalised 611
3.3.3 Gross or net of tax relief 613
3.3.4 Compounding 613
3.3.5 Accrued costs 614
3.3.6 Asset not previously held at cost 614
3.4 Group financial statements 614
3.4.1 Borrowings in one company and development in another 614
3.4.2 Qualifying assets held by investments accounted for using the
equity method 615
3.5 Other issues 616
3.5.1 Provisions for diminution in value 616
3.5.2 Change of policy 617
Detailed contents xxiii
3.5.3 Exchange differences as a borrowing cost 618
3.5.4 Assets produced by others 618
3.5.5 Depreciation 619
3.5.6 Interest capitalisation and creative accounting 619
4 Disclosure 620
4.1 Balance sheet and related notes 620
4.2 Profit and loss account and related notes 620
4.3 Accounting policy 622
5 Conclusion 623
CHAPTER 11 STOCKS AND LONG TERM CONTRACTS 627
1 Introduction 627
1.1 The importance of stocks and long term contracts within financial statements...627
1.2 What are stocks and long term contracts? 627
1.3 Objectives of stock measurement 628
2 Determining the cost of stock 629
2.1 Direct costing vs. full absorption costing 630
3 Determining the cost of sales 631
3.1 Cost flow assumptions based on the physical flow of goods 631
3.1.1 Specific identification/actual cost 631
3.1.2 FIFO (first in, first out) 632
3.2 Cost flow assumptions which disregard the physical flow of goods 633
3.2.1 Weighted average 633
3.2.2 LIFO (last in, first out) 633
3.2.3 Base stock 634
3.3 Illustration of the effect of different cost flow assumptions 635
4 The development of SSAP 9 (revised) 638
4.1 The original SSAP 9 638
4.2 The need for revision 639
4.3 SSAP 9 (Revised) 640
5 The requirements of the Companies Act 1985 640
5.1 Lower of cost and net realisable value 640
5.2 Stock included at a fixed amount 641
5.3 Determination of purchase price or production cost 641
5.4 Costing method and replacement cost 641
5.4.1 Most recent actual purchase price or production cost 644
5.5 Current cost 644
XXIV Generally Accepted Accounting Practice in the United Kingdom
6 Stocks 645
6.1 The accounting and disclosure requirements of SS AP 9 (Revised) 645
6.1.1 Suitable analysis of stocks 645
6.1.2 Accounting policies 647
6.2 Comparison with US and IASC pronouncements 648
6.2.1 US 648
6.2.2 IASC 649
6.3 Problem areas 650
6.3.1 Constituents of cost 650
6.3.2 Net realisable value 653
6.3.3 The valuation of high volumes of similar items of stock 656
6.3.4 Marking to market 657
7 Long term contracts 658
7.1 The accounting and disclosure requirements of SS AP 9 (Revised) 658
7.1.1 Definition 658
7.1.2 Turnover, related costs and attributable profit 659
7.1.3 Accounting policies 660
7.1.4 The financial statement presentation of long term contracts 661
7.1.5 Illustrative examples of the disclosure of long term contracts 662
7.2 Comparison with US and IASC pronouncements 668
7.2.1 US 668
7.2.2 IASC 668
7.3 Problem areas 670
7.3.1 How much profit? 670
7.3.2 How much turnover? 671
7.3.3 Approved variations and claims 672
7.3.4 Should profits be accrued on short term contracts? 673
7.3.5 Inclusion of interest 674
CHAPTER 12 CAPITAL INSTRUMENTS 677
1 Introduction 677
2 Progress towards an accounting standard 678
2.1 TR677 678
2.2 The ASB discussion paper 679
2.2.1 The distinction between debt and share capital 679
2.2.2 The disclosure of debt maturities 680
2.2.3 The measurement of interest expense and other costs 683
2.2.4 Proposed disclosure 684
2.3 Operating and Financial Review 685
¦
Detailed contents XXV
3 Companies Act and Stock Exchange requirements 689
3.1 The measurement of share and loan capital 689
3.1.1 Share capital 689
3.1.2 Loan capital 690
3.2 Disclosure requirements 691
3.2.1 Share capital 691
3.2.2 Loan capital 695
3.3 The purchase of a company s own shares 701
3.4 Scrip dividends 707
4 Accounting for particular types of instrument 711
4.1 Bonds with no rights to conversion 711
4.1.1 Stepped bonds 711
4.1.2 Deep discounted bonds 712
4.1.3 Bonds with variable interest rates or redemption payments 714
4.2 Share options and warrants 715
4.3 Convertible bonds 718
4.3.1 Traditional convertible bonds 718
4.3.2 Bonds with share warrants attached 720
4.3.3 Convertible bonds with premium puts 721
4.3.4 Convertible capital bonds 723
4.3.5 Perpetual debt 725
4.4 Preference shares 726
4.4.1 Redeemable preference shares 726
4.4.2 Convertible preference shares 728
4.5 Interest rate swaps 732
5 Comparison with US and IASC pronouncements 733
5.1 US 733
5.1.1 Share capital 733
5.1.2 Redeemable shares 734
5.1.3 Treasury stocks 735
5.1.4 Additional paid in capital 735
5.1.5 Dividends 736
5.1.6 Debt 736
5.1.7 Convertible debt and debt issued with warrants 738
5.1.8 Convertible bonds with a Premium Put 738
5.1.9 Financial instruments project 738
5.2 IASC 739
6 Conclusion 741
XXVi Generally Accepted Accounting Practice in the United Kingdom
CHAPTER 13 OFF BALANCE SHEET TRANSACTIONS 745
1 Introduction 745
1.1 What are off balance sheet transactions ? 745
1.2 Justifications for entering into off balance sheet transactions 745
1.3 Why the concern with off balance sheet transactions? 747
2 Progress towards an accounting standard 751
2.1 ICAEW Technical Release 603 751
2.2 ED 42 752
2.3 ED 49 754
2.4 ASB initiatives 757
2.4.1 Statement of Principles 757
2.4.2 Securitisation 758
3 Common forms of off balance sheet finance 759
3.1 Quasi subsidiaries 759
3.1.1 Off balance sheet transactions involving quasi subsidiaries 759
3.1.2 The definition of a subsidiary undertaking 765
3.1.3 ED 49 767
3.2 Consignment stocks 768
3.3 Sale and repurchase agreements 772
3.4 Factoring of debts 779
3.5 Securitised mortgages 782
3.6 Loan transfers 790
3.7 Take or pay contracts and throughput agreements 792
4 Current disclosure requirements affecting off balance sheet transactions 793
5 Comparison with US and IASC pronouncements 795
5.1 US 795
5.1.1 General 795
5.1.2 Quasi subsidiaries 795
5.1.3 Sale of assets 795
5.1.4 Long term obligations 796
5.1.5 Sales of real estate 796
5.1.6 Transfers of receivables with recourse 797
5.1.7 Financial instruments 798
5 2 IASC 800
6 Conclusion gOi
s
Detailed contents xxvii
CHAPTER 14 LEASES AND HIRE PURCHASE CONTRACTS 805
1 Introduction 805
1.1 What are leases and hire purchase contracts? 805
1.2 The tax position 806
1.3 SSAP21 806
1.4 Accounting requirements of SSAP 21 807
1.5 ICAEW review of SSAP 21 808
2 Determining the lease type 808
2.1 The 90% test 808
2.1.1 The fair value 809
2.1.2 The implicit interest rate 809
2.1.3 The minimum lease payments 809
2.1.4 An unguaranteed residual value 810
2.1.5 The lease term 810
2.2 90% test example 811
2.3 Determining the lease type — other factors 811
3 Accounting by lessees 814
3.1 Introduction 814
3.2 Capitalised fixed asset 814
3.3 Finance lease obligation 815
3.4 Methods of allocating finance charges to accounting periods 815
3.5 Carrying values 817
3.6 Operating leases 817
4 Disclosure by lessees 818
4.1 SSAP 21 requirements 818
4.2 Related Companies Act requirements 819
4.3 Disclosure in practice 820
5 Accounting by lessors 824
5.1 Introduction 824
5.2 Operating leases 824
5.3 Finance leases 825
5.4 Choice and disclosure of methods 825
5.5 Allocation of gross earnings — finance leases 826
5.5.1 Introduction 826
5.5.2 Methodology 826
5.5.3 Assumptions 829
5.5.4 Other methods 830
5.5.5 Net investment or net cash investment 830
S
XXV111 Generally Accepted Accounting Practice in the United Kingdom
5.6 Allocation of gross earnings — hire purchase contracts 831
5.6.1 Introduction 831
5.6.2 Methodology 831
5.6.3 Choice of method 832
6 Disclosure by lessors 832
6.1 SSAP 21 requirements 832
6.2 Related Companies Act requirements 833
6.3 Disclosure in practice 833
7 Problem areas 838
7.1 Classification of leases 838
7.1.1 Current practice 838
7.1.2 Leasing as an off balance sheet transaction 838
7.2 Termination of leases 840
7.2.1 Lease classification 840
7.2.2 Operating leases 841
7.2.3 Finance leases — lessee 841
7.2.4 Finance leases — lessor 842
7.3 Tax variation clauses 842
7.3.1 Introduction 842
7.3.2 Adjustments 842
7.3.3 Lessee 843
7.3.4 Lessor 843
7.4 Sale and leaseback transactions 843
7.4.1 Introduction 843
7.4.2 Finance or operating lease? 843
7.4.3 Leaseback under a finance lease 845 j
7.4.4 Leaseback under an operating lease 847 *
7.5 Income recognition by lessors 849
7.5.1 Initial direct costs 849
7.5.2 Residual values 850
7.6 Manufacturers/dealers 850
7.6.1 Introduction 850
7.6.2 Allocating the total profit of the manufacturer/dealer 851
7.7 Sub leases and back to back leases 852
7.7.1 Introduction 852
7.7.2 The original lessor and the ultimate lessee 852
7.7.3 The intermediate party 852
8 Comparison with US and IASC pronouncements 854
8.1 US 854
8.2 IASC 855
9 Conclusion 856
Detailed contents xxix
CHAPTER 15 GOVERNMENT GRANTS 861
1 Introduction 861
2 The development of SSAP 4 (Revised) 861
2.1 The original SSAP 4 861
2.2 ED 43 862
2.3 SSAP 4 (Revised) 862
3 The requirements of SSAP 4 (Revised) 863
3.1 Accounting 863
3.1.1 Treatment of capital grants 863
3.1.2 Treatment of revenue based grants 864
3.1.3 Accounting for receipt and repayment of grants 865
3.1.4 Matching grants against related expenditure 866
3.2 Disclosure 867
4 Problem areas 869
4.1 Achieving the most appropriate matching 869
4.1.1 Should the grant be split into its elements? 870
4.1.2 What was the purpose of the grant? 870
4.1.3 What is the period to be benefited by the grant? 870
4.1.4 Is a grant capital or revenue? 871
4.2 Capital grants on non depreciating assets 871
5 Comparison with the IASC pronouncement 872
CHAPTER 16 SEGMENTAL REPORTING 873
1 Introduction 873
1.1 Historical background 873
1.2 The objectives of segmental reporting 874
1.2.1 Introduction 874
1.2.2 The shareholder group 874
1.2.3 The investment analyst group 874
1.2.4 The lender/creditor group 875
1.2.5 Government 875
2 The UK position 875
2.1 Legislative requirements 875
2.2 Stock Exchange requirements 876
2.3 SSAP 25 876
2.3.1 The origins of the standard 876
2.3.2 General approach 877
2.3.3 Scope 877
XXX Generally Accepted Accounting Practice in the United Kingdom
2.3.4 What is a reportable segment? 878
2.3.5 What is to be reported? 879
2.3.6 Associated undertakings 881
2.3.7 Common costs 885
2.3.8 Disclosure in practice 885
2.4 Voluntary segmental disclosures 890
3 Problem areas 893
3.1 How to define the segments 893
3.2 Inter segment sales 899
3.3 Common costs 900
3.4 Allocation of interest income and interest expense 901
3.5 Exceptional items 904
3.6 Changes in composition of the group 906
3.7 How to define net assets 907
4 Comparison with US and IASC pronouncements 910
4.1 US 910
4.1.1 Introduction 910
4.1.2 SFAS 14 910
4.2 IASC 913
4.2.1 Introduction 913
4.2.2 IAS 14 913
5 Conclusion 914
CHAPTER 17 PENSION COSTS 917
1 Introduction 917
1.1 Background 917
1.2 The development of an accounting standard in the UK 918
1.2.1 Napier interim report 918
1.2.2 ED 32 920
1.2.3 Statement of Intent 921
1.2.4 ED 39 921
1.2.5 SSAP24 922
2 Requirements of SSAP 24 922
2.1 Scope 922
2.2 Accounting objective 923
2.3 Definition of terms 923
2.4 Defined contribution schemes 925
2.4.1 Accounting 925
2.4.2 Disclosure 926
Detailed contents XXXJ
2.5 Defined benefit schemes 926
2.5.1 Regular pension cost 927
2.5.2 Variations from regular cost 927
2.5.3 Discretionary and ex gratia pension increases and ex gratia
pensions 939
2.5.4 Balance sheet 939
2.5.5 Disclosure 946
3 The actuarial aspects of SSAP 24 953
3.1 Actuarial valuation methods 953
3.1.1 Background 953
3.1.2 The approach taken by the standard 955
3.1.3 Possible actuarial methods — accrued benefits methods 956
3.1.4 Possible actuarial methods — projected benefits methods 959
3.1.5 Actuarial valuation of assets 963
3.1.6 Conclusion 963
3.2 Actuarial assumptions and best estimates 963
3.3 The role of the actuary 964
4 Problem areas 965
4.1 The treatment of interest 965
4.2 Variations from regular cost 971
4.2.1 Calculation of remaining service lives 971
4.2.2 How should variations be amortised? 972
4.2.3 What is a significant reduction in employees? 976
4.2.4 Allocation of experience differences to funding consequences 976
4.2.5 How to account for the unamortised difference remaining in
the year of the next actuarial valuation 977
4.2.6 How to treat a balance sheet asset which is shown to have
been eroded by a subsequent valuation 979
4.3 Negative pension cost 980
4.4 Hybrid schemes 982
4.5 Foreign schemes 983
4.6 Unfunded schemes 983
4.7 Deferred tax 984
4.8 Post retirement benefits other than pensions 986
4.9 Accounting for the pension schemes of an acquired subsidiary 989
4.10 Group schemes 990
4.11 Multi employer schemes 991
5 Related Companies Act requirements 991
5.1 Pension commitments 991
5.2 Pension costs 992
5.3 Directors emoluments 992
XXXJi Generally Accepted Accounting Practice in the United Kingdom
6 Comparison with IASC and US pronouncements 993
6.1 IASC 993
6.1.1 IAS 19 993
6.1.2 E32 993
6.2 US 994
6.2.1 Background 994
6.2.2 SFAS 87 994
6.2.3 SFAS 88 995
6.2.4 SFAS 106 996
7 Conclusion 996
CHAPTER 18 TAXATION 1001
1 General principles 1001
1.1 The nature of taxation 1001
1.2 Allocation between periods 1002
1.2.1 Background 1002
1.2.2 Permanent differences 1002
1.2.3 Timing differences 1003
1.2.4 The deferral method 1005
1.2.5 The liability method (with full provision/comprehensive
allocation) 1008
1.2.6 The liability method (with partial provision) 1009
1.2.7 The hybrid method 1015
1.2.8 Discounting the liability 1016
1.2.9 The net of tax method 1017
1.2.10 The flow through method 1017
1.3 Allocation within periods 1017
2 The development of accounting for taxation in the UK 1018
2.1 Accounting for tax payable 1018
2.1.1 ED 12 1018
2.1.2 SSAP 8 1019
2.2 Accounting for deferred tax 1019
2.2.1 ED 11 1019
2.2.2 SSAP 11 1019
2.2.3 ED 19 1020
2.2.4 SSAP 15 1020
2.2.5 ED 33 1021
2.2.6 SSAP 15 (Revised) 1022
Detailed contents xxxiii
2.3 Other ASC pronouncements 1022
2.3.1 SSAP 5 1022
2.3.2 ED 28 1022
3 The requirements of the relevant accounting standards and company law 1023
3.1 SSAP 8 1023
3.1.1 Outgoing dividends and the related ACT 1023
3.1.2 Recoverable ACT 1023
3.1.3 Incoming dividends 1025
3.1.4 Disclosure of the tax charge in the profit and loss account 1025
3.2 SSAP 15 1027
3.2.1 General approach 1027
3.2.2 Definitions 1028
3.2.3 Detailed accounting requirements 1028
3.2.4 Disclosure 1031
3.3 Companies Act 1985 1038
4 Problem areas 1040
4.1 Combining different categories of timing difference 1040
4.2 Tax losses and deferred tax 1042
4.2.1 Tax losses which have been incurred 1042
4.2.2 Tax losses which have yet to be incurred 1044
4.3 Tax losses and group relief 1045
4.3.1 Background 1045
4.3.2 The financial statements of the profitable company 1045
4.3.3 The financial statements of the loss making company 1046
4.4 Tax in the financial statements of a group 1046
4.4.1 Offsetting consolidated tax balances 1046
4.4.2 Tax effects of consolidation adjustments 1049
4.5 ACT 1050
4.5.1 ACT carried forward as an asset 1050
4.5.2 ACT set against the deferred tax liability 1050
4.6 Changes in tax rates 1054
4.6.1 Corporation tax 1054
4.6.2 Deferred tax 1055
4.7 Revaluations of fixed assets 1056
4.8 Overseas earnings 1057
4.9 Deferred tax on fair value adjustments 1058
5 Comparison with US and IASC pronouncements 1059
5.1 IASC 1059
5.2 US 1059
5.2.1 APB 11 1059
5.2.2 SFAS 96 1060
XXXJV Generally Accepted Accounting Practice in the United Kingdom
5.2.3 SFAS 109 1061
5.2.4 Main differences between US and UK requirements 1063
6 Conclusion 1064
CHAPTER 19 REPORTING OF FINANCIAL PERFORMANCE 1067
1 The need for a standard 1067
1.1 Income measurement 1067
1.1.1 The all inclusive concept 1068
1.1.2 The current operating performance concept 1068
1.1.3 Which concept? 1069
1.2 The development of UK standards 1070
1.2.1 The original SSAP 6 1070
1.2.2 The revision of SSAP 6 1070
1.2.3 UITF2 1072
1.2.4 FRED 1 1072
2 The requirements of SSAP 6 (Revised) 1072
2.1 Identification of extraordinary and exceptional items 1072
2.1.1 Definitions 1072
2.1.2 Examples of exceptional and extraordinary items 1073
2.2 Terminated activities 1075
2.2.1 Identification of a business segment 1075
2.2.2 Items to be taken into account in evaluating the effect
of discontinuing a business segment 1077
2.2.3 Decision date and implementation date 1078
2.3 Tax attributable to extraordinary items 1078
2.4 Statement of movements on reserves 1079
2.5 Prior year adjustments 1080
2.5.1 Definition 1080
2.5.2 Identification of prior year adjustments 1080
2.5.3 Changes in accounting policy 1080
2.5.4 Correction of fundamental errors 1081
2.5.5 Accounting treatment 1081
2.6 Historical summaries, half yearly reports and preliminary profit statements.... 1085
2.7 Exceptions from SSAP 6 1086
2.7.1 Reserve movements permitted or required by other accounting
standards 1086
2.7.2 Reserve movements permitted or required by law 1086
2.7.3 Value based companies 1087
Detailed contents XXXV
3 Disclosure requirements 1087
3.1 Profit and loss account format 1087
3.2 Extraordinary items 1088
3.3 Exceptional items 1089
3.4 Prior year adjustments 1091
3.5 Statement of movements on reserves 1091
4 Problem areas 1094
4.1 Definition of extraordinary items 1094
4.2 Terminated activities 1095
4.2.1 Definition of business segment 1095
4.2.2 Identification of decision date and implementation date 1096
4.2.3 Formerly discontinued operations which are resumed 1099
4.2.4 Finance costs associated with discontinued operations 1099
4.3 Restructuring costs 1102
4.4 Historical summaries, half yearly reports and preliminary profits statements... 1103
5 FRED 1 1103
5.1 Introduction 1103
5.2 Discontinued operations 1105
5.3 The effect of acquisitions 1107
5.4 Extraordinary and exceptional items 1108
5.5 Revenue investment 1110
5.6 Statement of total recognised gains and losses 1110
5.7 Note of historical cost profits and losses 1111
6 Comparison with US, IASC and Canadian pronouncements 1112
6.1 US 1112
6.1.1 Extraordinary items 1112
6.1.2 Terminated activities (discontinued operations) 1113
6.1.3 Prior year adjustments 1114
6.2 IASC 1115
6.2.1 IAS 8 1115
6.2.2 E46 1115
6.3 Canada 1116
6.3.1 Infrequency of occurrence 1116
6.3.2 Normal business activities 1116
6.3.3 Decisions by management 1117
7 Conclusion 1117
xxxvi Generally Accepted Accounting Practice in the United Kingdom
CHAPTER 20 EARNINGS PER SHARE 1123
1 Introduction 1123
2 Scope of SSAP 3 1124
3 The basic EPS 1124
3.1 Definition of EPS 1124
3.2 Disclosure 1125
4 Changes in equity share capital 1126
4.1 Issue for cash at full market price 1126
4.2 Bonus issue and share split 1126
4.3 Rights issue 1128
4.4 Options exercised during the year 1131
4.5 Issue for cash at less than full market price 1132
4.6 Purchase and redemption of own shares 1132
4.7 Post balance sheet changes in capital 1132
4.8 Issue to acquire another business 1133
4.9 Group reconstructions 1134
4.10 Adjustments to EPS in five year summaries 1135
5 Matters affecting the EPS calculation 1135
5.1 Earnings 1135
5.2 Preference dividends 1135
5.3 Losses 1136
5.4 Prior year adjustments 1136
5.5 Different classes of equity shares 1136
5.6 Net and nil bases 1137
5.6.1 Should EPS be calculated net or nil ? 1138
5.6.2 Calculation of nil basis EPS 1139
5.7 Other bases 1141
6 Fully diluted earnings per share 1146
6.1 The need for fully diluted EPS 1146
6.2 Disclosure of fully diluted EPS 1147
6.3 Calculation of fully diluted EPS 1148
6.3.1 Equity shares with future dividend entitlement 1148
6.3.2 Convertible securities 1149
6.3.3 Options or warrants to subscribe for equity shares 1151
6.3.4 Fully diluted EPS calculations involving more than one type of
potentially dilutive security 1153
6.3.5 Deferred consideration agreements 1154
7 FRED 1 1156
Detailed contents XXXvii
8 Comparison with US pronouncements 1157
8.1 The primary EPS 1157
8.2 Fully diluted EPS 1158
8.3 Disclosure 1158
CHAPTER 21 POST BALANCE SHEET EVENTS 1161
1 The development of accounting for post balance sheet events 1161
1.1 Introduction 1161
1.2 ICAEW Recommendation N17 1162
1.3 ED 22 1162
1.4 SSAP 17 1163
2 Requirements of SSAP 17 1163
2.1 Definitions 1163
2.2 Events requiring adjustment 1165
2.3 Events not requiring adjustment but requiring disclosure 1165
2.4 Disclosure requirements 1172
3 Problem areas 1174
3.1 Reclassification of a non adjusting event as adjusting in exceptional
circumstances 1174
3.2 The valuation of stock realised after the balance sheet date 1175
3.3 Long term contracts 1176
3.4 Acquisitions and disposals of fixed assets 1176
3.5 Window dressing 1177
3.6 Valuations of property 1178
3.7 Insolvency of a debtor 1178
4 Comparison with US and IASC pronouncements 1179
4.1 US 1179
4.2 IASC 1179
5 Conclusion 1180
CHAPTER 22 CONTINGENCIES 1183
1 The development of accounting for contingencies 1183
1.1 Introduction 1183
1.2 The historical background 1183
2 Requirements of SSAP 18 1184
2.1 Definition of contingency 1184
2.2 Contingent gains 1184
2.3 Contingent losses 1185
XXXViii Generally Accepted Accounting Practice in the United Kingdom
2.4 Offsets 1186
2.5 Groupings 1187
2.6 Disclosure requirements 1187
3 Problem areas 1187
3.1 Probable, possible or remote 1187
3.2 Estimating the amount of a contingency 1188
3.3 Disclosure of the financial effect of a contingency 1190
3.4 Litigation and disclosure of potentially prejudicial information 1194
3.5 Disclosure of remote contingencies 1195
3.6 Other problem areas 1197
3.6.1 Guarantees — year end or maximum liability 1197
3.6.2 Discounted bills of exchange 1198
3.6.3 VAT groups 1199
3.6.4 Performance bonds 1199
4 Comparison with US and IASC pronouncements 1200
4.1 US 1200
4.2 IASC 1201
CHAPTER 23 CASH FLOW STATEMENTS 1203
1 The evolution of the cash flow statement 1203
1.1 Statements of source and application of funds 1203
1.2 The form and content of the funds statement 1204
1.3 The objectives of the SSAP 10 funds statement 1205
1.4 The funds statement and cash flows 1206
1.5 The distinction between funds flow under SSAP 10 and cash flow under
FRS 1 1207
2 The requirements of FRS 1 1210
2.1 Scope and exemptions 1210
2.2 Cash and cash equivalents 1214
2.3 Format of the cash flow statement 1216
2.4 Classification of cash flows by standard heading 1216
2.4.1 Operating activities 1216
2.4.2 Returns on investments and servicing of finance 1220
2.4.3 Taxation 1222
2.4.4 Investing activities 1224
2.4.5 Financing 1228
2.4.6 Exceptional and extraordinary items 1230
2.4.7 Interpretation of the standard headings 1231
2.5 Reconciliations 1232
2.6 Comparative figures 1234
Detailed contents XXxix
2.7 Groups 1234
2.7.1 Acquisitions and disposals of subsidiary undertakings 1235
2.7.2 Associated undertakings and equity accounted joint ventures 1238
2.8 Foreign currency 1238
2.8.1 Individual entity 1238
2.8.2 Groups 1239
2.8.3 Hedging transactions 1241
2.9 Non cash transactions 1241
2.10 Notes to the cash flow statement 1242
3 Problem areas 1243
3.1 The definition of cash equivalents 1243
3.2 The definition of cash flows from operating activities 1246
3.2.1 Acquisition provisions 1247
3.2.2 Extraordinary items 1248
3.3 Cash which is subject to restriction 1249
3.4 Commercial paper issued by the reporting entity 1249
3.5 Revolving credit 1250
3.6 Deferred development expenditure 1250
3.7 Cash earnings per share 1251
4 Comparison with US and IASC requirements 1252
4.1 US 1252
4.1.1 Introduction 1252
4.1.2 Focus of SFAS 95 1253
4.1.3 Cash equivalents 1254
4.1.4 Form and content of the statement of cash flows 1254
4.1.5 Investing activities 1254
4.1.6 Financing activities 1255
4.1.7 Operating activities 1256
4.1.8 Receipts and payments are presented gross 1256
4.1.9 Non cash activities are disclosed separately 1257
4.1.10 Choice of using the direct or indirect methods 1257
4.1.11 Illustrative examples 1258
4.2 Summary of principal differences between FRS 1 and SFAS 95 1261
4.3 IASC 1263
5 Conclusion 1264
XI Generally Accepted Accounting Practice in the United Kingdom
CHAPTER 24 RELATED PARTIES 1269
1 Introduction 1269
1.1 The related party issue 1269
1.2 Possible solutions 1270
1.2.1 Remeasurement of transactions at fair values 1270
1.2.2 Disclosure of transactions 1270
1.3 Position in the UK 1271
2 ED 46 1272
2.1 Introduction 1272
2.2 Identification of related parties 1272
2.3 Types of transactions and arrangements 1273
2.4 Information to be disclosed 1274
2.4.1 Abnormal transactions 1274
2.4.2 Controlling relationship 1275
2.4.3 Economic dependence 1275
2.4.4 Specific exemptions from disclosure 1276
2.4.5 Disclosure in practice 1276
3 Problem areas 1278
3.1 Identification of related parties 1278
3.1.1 Control or significant influence 1278
3.1.2 Controlled or significantly influenced parties 1278
3.1.3 Controlling or significantly influencing parties 1279
3.1.4 Enterprises under common control or significant influence 1283
3.1.5 Economic dependence 1285
3.1.6 Conclusion 1286
3.2 Types of transactions and arrangements 1287
3.2.1 Introduction 1287
3.2.2 Normal/abnormal transactions 1287
4 Other requirements in the UK 1290
4.1 Legislative requirements 1290
4.1.1 Directors 1290
4.1.2 Non director officers 1290
4.1.3 Related undertakings 1291
4.2 UK accounting standards 1295
4.3 Stock Exchange requirements 1296
4.3.1 Directors 1296
4.3.2 Shareholders 1297
Detailed contents xli
5 Comparison with US and IASC pronouncements 1298
5.1 IASC 1298
5.1.1 IAS 24 1298
5.2 US 1299
5.2.1 SFAS 57 1299
6 Conclusion 1300
CHAPTER 25 DIRECTORS AND OFFICERS LOANS AND
TRANSACTIONS 1303
1 Introduction 1303
1.1 Outline of historical development in the UK 1303
2 Definitions 1304
2.1 Director 1304
2.2 Shadow director 1304
2.3 Alternate director 1304
2.4 Connected person 1304
2.5 Officer 1306
2.6 Loan 1306
2.7 Quasi loan 1306
2.8 Credit transaction 1307
3 Disclosure requirements 1308
3.1 Introduction 1308
3.2 Scope 1308
3.3 Transactions requiring disclosure 1310
3.4 Section 330 transactions 1311
3.4.1 Introduction 1311
3.4.2 Disclosure requirements 1311
3.5 Material interest transactions 1317
3.5.1 Introduction 1317
3.5.2 Definition of material interest 1317
3.5.3 Disclosure requirements 1318
3.6 Exemptions from disclosure 1324
3.6.1 General 1324
3.6.2 Section 330 transactions 1324
3.6.3 Material interest transactions 1324
4 Banking companies under the Banking Act 1987 1325
4.1 Disclosure of transactions by banking companies 1326
Xlii Generally Accepted Accounting Practice in the United Kingdom
5 Requirements of The Stock Exchange 1326
5.1 Listed companies 1326
5.2 USM companies 1327
6 Transactions involving officers 1328
6.1 Introduction 1328
6.2 Disclosure requirements 1328
6.3 Banking companies under the Banking Act 1987 1329
7 Conclusion 1329
APPENDIX: LEGAL REQUIREMENTS 1331
A Introduction 1331
B Prohibited transactions 1331
B.I Loans 1331
B.2 Quasi loans and credit transactions 1331
B.3 Assignment/assumption of rights, obligations or liabilities 1331
B.4 Arrangements 1332
C Exempted transactions 1332
C.I Loans of small amounts 1332
C.2 Short term quasi loans 1332
C.3 Minor or business credit transactions 1332
C.4 Inter company transactions 1333
C.5 Directors business expenditure 1333
C.6 Money lending companies 1333
C.7 Companies registered overseas 1334
D Sanctions 1334
D.I Civil remedies 1334
D.2 Criminal penalties 1334
E Interests in contracts 1335
F Substantial property transactions 1336
G Transactions involving officers 1337
CHAPTER 26 DIRECTORS REMUNERATION 1343
1 Introduction 1343
1.1 Remuneration 1343
1.2 Pensions 1344
1.3 Compensation for loss of office 1344
1.4 Service contracts 1344
2 Disclosure of remuneration 1345
2.1 Introduction 1345
Detailed contents xim
2.2 Disclosure of aggregate emoluments 1346
2.2.1 Legal requirements 1346
2.2.2 Problem areas 1348
2.3 Definition of emoluments 1350
2.3.1 Legal requirements 1350
2.3.2 Problem areas 1350
2.4 Computing aggregate emoluments 1356
2.4.1 Legal requirements 1356
2.4.2 Problem areas 1361
2.5 Bandings 1363
2.6 Emoluments waived 1366
2.7 Pensions of directors and past directors 1368
2.8 Compensation for loss of office 1370
2.8.1 Legal requirements 1370
2.8.2 Problem areas 1373
2.9 Payments to third parties 1375
3 Employee disclosures 1376
3.1 Director as an employee 1376
4 Current developments 1376
4.1 Voluntary disclosures 1376
4.2 Cadbury report 1382
APPENDIX SPECIMEN FINANCIAL STATEMENTS 1387
Introduction 1387
Good Practice Limited 1389
Good Group P.L.C 1411
Good Group P.L.C. Summary Financial Statement 1453
INDEX OF EXTRACTS FROM ACCOUNTS 1459
INDEX 1465
|
| any_adam_object | 1 |
| author | Davies, Mike Paterson, Ron Wilson, Allister |
| author_facet | Davies, Mike Paterson, Ron Wilson, Allister |
| author_role | aut aut aut |
| author_sort | Davies, Mike |
| author_variant | m d md r p rp a w aw |
| building | Verbundindex |
| bvnumber | BV005769280 |
| callnumber-first | H - Social Science |
| callnumber-label | HF5616 |
| callnumber-raw | HF5616.G7 |
| callnumber-search | HF5616.G7 |
| callnumber-sort | HF 45616 G7 |
| callnumber-subject | HF - Commerce |
| classification_rvk | QP 800 QP 822 |
| ctrlnum | (OCoLC)27011575 (DE-599)BVBBV005769280 |
| dewey-full | 657.0941 |
| dewey-hundreds | 600 - Technology (Applied sciences) |
| dewey-ones | 657 - Accounting |
| dewey-raw | 657.0941 |
| dewey-search | 657.0941 |
| dewey-sort | 3657.0941 |
| dewey-tens | 650 - Management and auxiliary services |
| discipline | Wirtschaftswissenschaften |
| edition | 3. ed. |
| format | Book |
| fullrecord | <?xml version="1.0" encoding="UTF-8"?><collection xmlns="http://www.loc.gov/MARC21/slim"><record><leader>02737nam a2200637 c 4500</leader><controlfield tag="001">BV005769280</controlfield><controlfield tag="003">DE-604</controlfield><controlfield tag="005">20210910 </controlfield><controlfield tag="007">t</controlfield><controlfield tag="008">921106s1992 d||| |||| 00||| eng d</controlfield><datafield tag="020" ind1=" " ind2=" "><subfield code="a">0333578988</subfield><subfield code="9">0-333-57898-8</subfield></datafield><datafield tag="035" ind1=" " ind2=" "><subfield code="a">(OCoLC)27011575</subfield></datafield><datafield tag="035" ind1=" " ind2=" "><subfield code="a">(DE-599)BVBBV005769280</subfield></datafield><datafield tag="040" ind1=" " ind2=" "><subfield code="a">DE-604</subfield><subfield code="b">ger</subfield><subfield code="e">rakddb</subfield></datafield><datafield tag="041" ind1="0" ind2=" "><subfield code="a">eng</subfield></datafield><datafield tag="049" ind1=" " ind2=" "><subfield code="a">DE-473</subfield><subfield code="a">DE-384</subfield></datafield><datafield tag="050" ind1=" " ind2="0"><subfield code="a">HF5616.G7</subfield></datafield><datafield tag="082" ind1="0" ind2=" "><subfield code="a">657.0941</subfield><subfield code="2">20</subfield></datafield><datafield tag="084" ind1=" " ind2=" "><subfield code="a">QP 800</subfield><subfield code="0">(DE-625)141940:</subfield><subfield code="2">rvk</subfield></datafield><datafield tag="084" ind1=" " ind2=" "><subfield code="a">QP 822</subfield><subfield code="0">(DE-625)141945:</subfield><subfield code="2">rvk</subfield></datafield><datafield tag="100" ind1="1" ind2=" "><subfield code="a">Davies, Mike</subfield><subfield code="e">Verfasser</subfield><subfield code="4">aut</subfield></datafield><datafield tag="245" ind1="1" ind2="0"><subfield code="a">Generally accepted accounting practice in the United Kingdom</subfield><subfield code="b">UK GAAP</subfield><subfield code="c">Mike Davies, Ron Paterson & Allister Wilson of Ernst & Young</subfield></datafield><datafield tag="246" ind1="1" ind2="3"><subfield code="a">UK GAAP</subfield></datafield><datafield tag="246" ind1="1" ind2="3"><subfield code="a">UK GAAP</subfield></datafield><datafield tag="250" ind1=" " ind2=" "><subfield code="a">3. ed.</subfield></datafield><datafield tag="264" ind1=" " ind2="1"><subfield code="a">Basingstoke</subfield><subfield code="b">Macmillan</subfield><subfield code="c">1992</subfield></datafield><datafield tag="300" ind1=" " ind2=" "><subfield code="a">XLIII, 1496 S.</subfield><subfield code="b">graph. Darst.</subfield></datafield><datafield tag="336" ind1=" " ind2=" "><subfield code="b">txt</subfield><subfield code="2">rdacontent</subfield></datafield><datafield tag="337" ind1=" " ind2=" "><subfield code="b">n</subfield><subfield code="2">rdamedia</subfield></datafield><datafield tag="338" ind1=" " ind2=" "><subfield code="b">nc</subfield><subfield code="2">rdacarrier</subfield></datafield><datafield tag="500" ind1=" " ind2=" "><subfield code="a">2. Aufl. u.d.T.: Generally accepted accounting practice in the United Kingdom</subfield></datafield><datafield tag="650" ind1=" " ind2="7"><subfield code="a">Financiële verslaglegging</subfield><subfield code="2">gtt</subfield></datafield><datafield tag="650" ind1=" " ind2="4"><subfield code="a">Accounting</subfield><subfield code="x">Standards</subfield><subfield code="z">Great Britain</subfield></datafield><datafield tag="650" ind1=" " ind2="4"><subfield code="a">Accounting</subfield><subfield code="z">Great Britain</subfield></datafield><datafield tag="650" ind1="0" ind2="7"><subfield code="a">Rechnungswesen</subfield><subfield code="0">(DE-588)4048732-5</subfield><subfield code="2">gnd</subfield><subfield code="9">rswk-swf</subfield></datafield><datafield tag="650" ind1="0" ind2="7"><subfield code="a">Rechnungslegung</subfield><subfield code="0">(DE-588)4128343-0</subfield><subfield code="2">gnd</subfield><subfield code="9">rswk-swf</subfield></datafield><datafield tag="650" ind1="0" ind2="7"><subfield code="a">Buchführungsgrundsätze</subfield><subfield code="0">(DE-588)4069703-4</subfield><subfield code="2">gnd</subfield><subfield code="9">rswk-swf</subfield></datafield><datafield tag="650" ind1="0" ind2="7"><subfield code="a">Richtlinie</subfield><subfield code="0">(DE-588)4137814-3</subfield><subfield code="2">gnd</subfield><subfield code="9">rswk-swf</subfield></datafield><datafield tag="651" ind1=" " ind2="4"><subfield code="a">Großbritannien</subfield></datafield><datafield tag="651" ind1=" " ind2="7"><subfield code="a">Großbritannien</subfield><subfield code="0">(DE-588)4022153-2</subfield><subfield code="2">gnd</subfield><subfield code="9">rswk-swf</subfield></datafield><datafield tag="689" ind1="0" ind2="0"><subfield code="a">Großbritannien</subfield><subfield code="0">(DE-588)4022153-2</subfield><subfield code="D">g</subfield></datafield><datafield tag="689" ind1="0" ind2="1"><subfield code="a">Buchführungsgrundsätze</subfield><subfield code="0">(DE-588)4069703-4</subfield><subfield code="D">s</subfield></datafield><datafield tag="689" ind1="0" ind2=" "><subfield code="5">DE-604</subfield></datafield><datafield tag="689" ind1="1" ind2="0"><subfield code="a">Rechnungslegung</subfield><subfield code="0">(DE-588)4128343-0</subfield><subfield code="D">s</subfield></datafield><datafield tag="689" ind1="1" ind2="1"><subfield code="a">Richtlinie</subfield><subfield code="0">(DE-588)4137814-3</subfield><subfield code="D">s</subfield></datafield><datafield tag="689" ind1="1" ind2="2"><subfield code="a">Großbritannien</subfield><subfield code="0">(DE-588)4022153-2</subfield><subfield code="D">g</subfield></datafield><datafield tag="689" ind1="1" ind2=" "><subfield code="8">1\p</subfield><subfield code="5">DE-604</subfield></datafield><datafield tag="689" ind1="2" ind2="0"><subfield code="a">Großbritannien</subfield><subfield code="0">(DE-588)4022153-2</subfield><subfield code="D">g</subfield></datafield><datafield tag="689" ind1="2" ind2="1"><subfield code="a">Rechnungswesen</subfield><subfield code="0">(DE-588)4048732-5</subfield><subfield code="D">s</subfield></datafield><datafield tag="689" ind1="2" ind2=" "><subfield code="5">DE-604</subfield></datafield><datafield tag="700" ind1="1" ind2=" "><subfield code="a">Paterson, Ron</subfield><subfield code="e">Verfasser</subfield><subfield code="4">aut</subfield></datafield><datafield tag="700" ind1="1" ind2=" "><subfield code="a">Wilson, Allister</subfield><subfield code="e">Verfasser</subfield><subfield code="4">aut</subfield></datafield><datafield tag="856" ind1="4" ind2="2"><subfield code="m">HBZ Datenaustausch</subfield><subfield code="q">application/pdf</subfield><subfield code="u">http://bvbr.bib-bvb.de:8991/F?func=service&doc_library=BVB01&local_base=BVB01&doc_number=003604124&sequence=000002&line_number=0001&func_code=DB_RECORDS&service_type=MEDIA</subfield><subfield code="3">Inhaltsverzeichnis</subfield></datafield><datafield tag="856" ind1="4" ind2="2"><subfield code="m">HBZ Datenaustausch</subfield><subfield code="q">application/pdf</subfield><subfield code="u">http://bvbr.bib-bvb.de:8991/F?func=service&doc_library=BVB01&local_base=BVB01&doc_number=003604124&sequence=000004&line_number=0002&func_code=DB_RECORDS&service_type=MEDIA</subfield><subfield code="3">Inhaltsverzeichnis</subfield></datafield><datafield tag="999" ind1=" " ind2=" "><subfield code="a">oai:aleph.bib-bvb.de:BVB01-003604124</subfield></datafield><datafield tag="883" ind1="1" ind2=" "><subfield code="8">1\p</subfield><subfield code="a">cgwrk</subfield><subfield code="d">20201028</subfield><subfield code="q">DE-101</subfield><subfield code="u">https://d-nb.info/provenance/plan#cgwrk</subfield></datafield></record></collection> |
| geographic | Großbritannien Großbritannien (DE-588)4022153-2 gnd |
| geographic_facet | Großbritannien |
| id | DE-604.BV005769280 |
| illustrated | Illustrated |
| indexdate | 2024-07-09T16:34:22Z |
| institution | BVB |
| isbn | 0333578988 |
| language | English |
| oai_aleph_id | oai:aleph.bib-bvb.de:BVB01-003604124 |
| oclc_num | 27011575 |
| open_access_boolean | |
| owner | DE-473 DE-BY-UBG DE-384 |
| owner_facet | DE-473 DE-BY-UBG DE-384 |
| physical | XLIII, 1496 S. graph. Darst. |
| publishDate | 1992 |
| publishDateSearch | 1992 |
| publishDateSort | 1992 |
| publisher | Macmillan |
| record_format | marc |
| spelling | Davies, Mike Verfasser aut Generally accepted accounting practice in the United Kingdom UK GAAP Mike Davies, Ron Paterson & Allister Wilson of Ernst & Young UK GAAP 3. ed. Basingstoke Macmillan 1992 XLIII, 1496 S. graph. Darst. txt rdacontent n rdamedia nc rdacarrier 2. Aufl. u.d.T.: Generally accepted accounting practice in the United Kingdom Financiële verslaglegging gtt Accounting Standards Great Britain Accounting Great Britain Rechnungswesen (DE-588)4048732-5 gnd rswk-swf Rechnungslegung (DE-588)4128343-0 gnd rswk-swf Buchführungsgrundsätze (DE-588)4069703-4 gnd rswk-swf Richtlinie (DE-588)4137814-3 gnd rswk-swf Großbritannien Großbritannien (DE-588)4022153-2 gnd rswk-swf Großbritannien (DE-588)4022153-2 g Buchführungsgrundsätze (DE-588)4069703-4 s DE-604 Rechnungslegung (DE-588)4128343-0 s Richtlinie (DE-588)4137814-3 s 1\p DE-604 Rechnungswesen (DE-588)4048732-5 s Paterson, Ron Verfasser aut Wilson, Allister Verfasser aut HBZ Datenaustausch application/pdf http://bvbr.bib-bvb.de:8991/F?func=service&doc_library=BVB01&local_base=BVB01&doc_number=003604124&sequence=000002&line_number=0001&func_code=DB_RECORDS&service_type=MEDIA Inhaltsverzeichnis HBZ Datenaustausch application/pdf http://bvbr.bib-bvb.de:8991/F?func=service&doc_library=BVB01&local_base=BVB01&doc_number=003604124&sequence=000004&line_number=0002&func_code=DB_RECORDS&service_type=MEDIA Inhaltsverzeichnis 1\p cgwrk 20201028 DE-101 https://d-nb.info/provenance/plan#cgwrk |
| spellingShingle | Davies, Mike Paterson, Ron Wilson, Allister Generally accepted accounting practice in the United Kingdom UK GAAP Financiële verslaglegging gtt Accounting Standards Great Britain Accounting Great Britain Rechnungswesen (DE-588)4048732-5 gnd Rechnungslegung (DE-588)4128343-0 gnd Buchführungsgrundsätze (DE-588)4069703-4 gnd Richtlinie (DE-588)4137814-3 gnd |
| subject_GND | (DE-588)4048732-5 (DE-588)4128343-0 (DE-588)4069703-4 (DE-588)4137814-3 (DE-588)4022153-2 |
| title | Generally accepted accounting practice in the United Kingdom UK GAAP |
| title_alt | UK GAAP |
| title_auth | Generally accepted accounting practice in the United Kingdom UK GAAP |
| title_exact_search | Generally accepted accounting practice in the United Kingdom UK GAAP |
| title_full | Generally accepted accounting practice in the United Kingdom UK GAAP Mike Davies, Ron Paterson & Allister Wilson of Ernst & Young |
| title_fullStr | Generally accepted accounting practice in the United Kingdom UK GAAP Mike Davies, Ron Paterson & Allister Wilson of Ernst & Young |
| title_full_unstemmed | Generally accepted accounting practice in the United Kingdom UK GAAP Mike Davies, Ron Paterson & Allister Wilson of Ernst & Young |
| title_short | Generally accepted accounting practice in the United Kingdom |
| title_sort | generally accepted accounting practice in the united kingdom uk gaap |
| title_sub | UK GAAP |
| topic | Financiële verslaglegging gtt Accounting Standards Great Britain Accounting Great Britain Rechnungswesen (DE-588)4048732-5 gnd Rechnungslegung (DE-588)4128343-0 gnd Buchführungsgrundsätze (DE-588)4069703-4 gnd Richtlinie (DE-588)4137814-3 gnd |
| topic_facet | Financiële verslaglegging Accounting Standards Great Britain Accounting Great Britain Rechnungswesen Rechnungslegung Buchführungsgrundsätze Richtlinie Großbritannien |
| url | http://bvbr.bib-bvb.de:8991/F?func=service&doc_library=BVB01&local_base=BVB01&doc_number=003604124&sequence=000002&line_number=0001&func_code=DB_RECORDS&service_type=MEDIA http://bvbr.bib-bvb.de:8991/F?func=service&doc_library=BVB01&local_base=BVB01&doc_number=003604124&sequence=000004&line_number=0002&func_code=DB_RECORDS&service_type=MEDIA |
| work_keys_str_mv | AT daviesmike generallyacceptedaccountingpracticeintheunitedkingdomukgaap AT patersonron generallyacceptedaccountingpracticeintheunitedkingdomukgaap AT wilsonallister generallyacceptedaccountingpracticeintheunitedkingdomukgaap AT daviesmike ukgaap AT patersonron ukgaap AT wilsonallister ukgaap |
Es ist kein Print-Exemplar vorhanden.
Inhaltsverzeichnis