ASB timescale is unrealistic, says ICAS

The timescale given to make changes to UK GAAP is ‘unrealistic’ says the Institute of Chartered Accountants in Scotland.

The Scottisch institute welcomed the Accounting Standards Board’s proposals on the future of UK GAAP, indicating approval in its response of the suggestion to adopt a three-tiered structure for financial reporting in the UK. But it also considers that the proposed timescale is unrealistic.

The institute is concerned over the strain this could have on businesses, as any that have adopted International Financial Reporting Standards or IFRS for SMEs will need to prepare reports for the financial year before adoption kicks in. Under current proposals, that will mean restating financial statements for 2011, but a final decision on these proposals is not likely to happen much before December 2010.

David Wood, ICAS executive director of technical policy said: ‘ICAS proposes that the date of transition should be 1 January, at least two years from the date the ASB publishes its final requirements.

‘It is possible that implementation of the proposals for public benefit entities such as charities might need to be delayed, for example by changes to legislation or revisions to sectoral guidance, but this should not impede the transition for profit-making entities,’ he added.