2. Business Accounting (F84M 34)
Introduction of FRS102
Changes to accounting terminology and layouts

3. New financial statement formats and accounting terminology
For accounting periods beginning on or after
1 January 2015, all the current financial reporting
standards (FRSs, SSAPs, etc) issued by the Financial
Reporting Council have been withdrawn.

4. From January 2015 the UK GAAP framework will be articulated on the following standards: FRS 100;
FRS 101; FRS 102; FRS 103; and FRSSEE 2015.
FRS 102 is the Financial Reporting Standard Applicable in the UK and the Republic of Ireland, and is the single financial reporting standard that replaces almost all the existing standards.

5. What does FRS102 mean for the Business Accounting Unit?
Changes to terminology that has always been used in Unit Specifications
Changes to all titles and layouts of financial statements
Changes to terminology used in ratios

6. SQA support so far
Update letter (August 2014) advising centres of changes
Sample layouts issued for sole traders, partnerships, limited companies and plcs
Revised formulae issued for ratios
Suggested layouts and ratios used in revised exemplars (ASPs), where appropriate

7. Upcoming Changes
From August Session 2015/16 implement revised Unit Specifications for HNC (level 7) in all centres
Exemplar 1 / ASP 1 (Elite plc) has been updated - centres must use these new assessments or devise/update their own as appropriate
Exemplar 2 (Humbro plc) has not yet been updated

8. How does this affect Business Accounting?
Outcome 1 – Financial Statements for a limited company
Significant changes to layouts:
P&L – Income Statement
BS – Statement of Financial Position plus
Statement of Changes in Equity
Terminology – for example:
Stock – Inventory
Debtors – Trade receivables
Creditors – Trade payables

9. How will this affect Business Accounting?
Outcome 2 – Cash budgets and break-even
No changes
Outcomes 3, 4 and 5 – Users, Sources of Finance, Ratio Analysis
Significant changes
New layouts and terminology for P&L, BS, Cash Flow provided in assessment
New terminology in ratio formulae

10. Impact Use new Unit Specification from August 2015
Use updated ASP or write/update assessment instruments
Terminology and new layout need to be updated in all teaching materials, formative assessments, re-assessments for Outcomes 1 and 3, 4 and 5

11. Modifications to Unit Specification
Assessment conditions set out in the Unit Specification for Outcomes 3, 4 and 5 have been modified for clarification
Currently ‘The assessment evidence should be generated under supervised conditions’.
Changed to ‘The assessment evidence should be generated under open book supervised conditions’.

12. Modifications to Unit Specification
Guidelines suggest that the assessment of Outcomes 3, 4 and 5 may be combined.
However, where a centre chooses to assess any (or all) of the Outcomes independently, ‘a different case study/scenario must be used’ at each assessment event.

13. Future changes? HND Units to be modified for Session 2016/17
Preparing Financial Forecasts (F84R 35)
Has still to be reviewed in detail, but no major changes anticipated

14. Questions?
Liz MacFadyen
March 2015