Newswire August 2023

  • Person icon Mercia Group
  • Calendar icon 24 August 2023 00:00

Welcome to our August Newswire.

We hope you’ve all enjoyed a good break this summer despite the wet weather. However, the wind and the rain have failed to put the brakes on developments in the tax, accounting and audit sectors.

The government has now published details of the new pensions tax regime following the abolition of the Lifetime Allowance while the ICAEW has released its Practice Assurance Monitoring Report 2023.

For additional details on these topics, or to find out more on what’s happening in the accountancy, tax and audit sectors take a look at our news and insights page.

It has been a busy summer for us at Mercia too as we prepare for the return of our face to face courses in September.

Upcoming courses include Professional Skills, Bookkeeping and our Autumn updates on Tax and Audit and Accounting. Please have a look at Mercia’s full range of courses and venues.

All Mercia’s courses, including face to face, are available via our flexible pay as you go options.

In this month’s Newswire, we look at HMRC’s approach to R&D reliefs and changes to reporting income for self employment and partnerships - please see the tax section for details. On the audit side, we look at the FRC’s latest facts and trends report and consultations on revisions to Ethical Standards for Auditors.

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Probate Practitioners Conference

21 September 2023

Join us at our full-day virtual conference, where we have a whole host of informative sessions from various speakers lined up for the day, focusing on topical issues and matters relevant to undertaking probate work.


FRC publishes latest accountancy and audit facts and trends report

The FRC has published the 21st edition of its Key Facts and Trends (KFAT) report, providing the latest statistical information and trends on the UK accountancy and audit profession. This year's report highlights continued growth in accountancy membership, with nearly 400,000 members now in the UK and Republic of Ireland, up 2.1% on the previous year. However, the number of accountancy students fell by 3.5% in 2022 to just over 155,000.

FRC consults on revisions to Ethical Standard for Auditors

The FRC has issued a consultation on revisions to the FRC’s Ethical Standard. The proposed revisions include withdrawal of the Other Entities of Public Interest (OEPI) category, enhanced prohibitions where an audit firm’s independence could be threatened and other changes to reflect relevant findings from audit inspections and enforcement cases. The changes are also designed to ensure that the UK standard is no less stringent that the international (IESBA) code.

Draft Statement of Recommended Practice Accounting by Limited Liability Partnerships

The draft LLPs SORP has been updated in response to stakeholder feedback received as part of the 2021 LLPs SORP consultation. On consideration of the feedback, the LLPs SORP Steering Group is proposing to add guidance for the following areas; Amounts payable to former members, sharing of group profits – interests in subsidiaries and Automatic division of profits to members who do not provide any services to the LLP. It is proposed that the updated SORP would be effective for periods commencing on or after 1 January 2024.

FRC welcomes new corporate reporting requirements

The FRC welcomes the publication of a draft statutory instrument on corporate reporting, which strengthens reporting requirements. The new requirements will apply to very large companies (with at least 750 employees and an annual turnover of £750 million or more) and introduce:

  • an annual Resilience Statement, setting out how a company is managing risk and building or maintaining resilience over the short, medium, and long term
  • a triennial Audit and Assurance Policy Statement, explaining how the company proposes to assure non-financial reporting over the following three years as well as an annual update on the implementation of the policy;
  • an annual statement about distributable profits and the company’s policy on distributions; and
  • an annual statement on steps taken to prevent and detect material fraud.

Implementation is subject to parliamentary approval and not expected until 2025.

FRC thematic review examines quality of climate-related metrics and targets disclosures

The FRC has published a thematic review, assessing the quality and maturity of climate-related metrics and targets disclosures. The review analysed TCFD disclosures from 20 companies' 2022 annual reports across four sectors: materials and buildings, energy, banks, and asset managers. It identified areas of better reporting practice as well as opportunities for improvement.

UK Sustainability Disclosure TAC issues call for evidence

The FRC, in its role as The Secretariat to the UK Sustainability Disclosure Technical Advisory Committee, has issued a call for evidence to inform the proposed endorsement of the IFRS Sustainability Disclosure Standards in the UK. The International Sustainability Standards Board (ISSB) published IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information and IFRS S2 Climate-related Disclosures in June 2023.

IAASB launches consultation on proposed global sustainability standard

The International Auditing and Assurance Standards Board (IAASB) issued its proposed International Standard on Sustainability Assurance (ISSA) 5000, General Requirements for Sustainability Assurance Engagements. The proposed ISSA 5000 is a principles-based, overarching standard suitable for both limited and reasonable assurance engagements on sustainability information reported across any sustainability topic.

Seven situations that require a practising certificate

The ICAEW has issued guidance on seven situations where a practicing certificate will be required under new guidance applying from 1 January 2024 but where accountants might not think that this is the case.

IAEW CRF issues new factsheet on 2023 GAAP Accounts 

The Corporate Reporting Faculty has issued a new helpsheet - 2023 GAAP Accounts. The factsheet deals primarily with requirements that are mandatory for accounting periods beginning on or after 1 January 2023.

At the same time the Faculty has also issued an updated version of its helpsheet 2022 GAAP Accounts. This updated factsheet highlights new and modified requirements and includes practical tips on the implications of the changes.



HMRC’s approach to Research and Development tax reliefs

HMRC has published details on their compliance approach to Research and Development tax reliefs. To read more, please click here.

HMRC guidance on changes to reporting income from self employment and partnerships

HMRC has published a new guidance page on how to report profit on the return for 2023/24 if the self-employed or partnership business accounting year does not end on or between 31 March to 5 April. To read more, please click here.

Overlap relief

On 29 August 2023 HMRC will be launching an online form for submitting requests for details about overlap relief. This will provide an easier way for businesses and agents to submit requests and make sure that these are dealt with separately from general post. To read more, please click here.


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