What are the key differences between UK GAAP and IFRS?
The most significant difference in terms of broad treatments of items between UK GAAP and IFRS in the following areas: • Pension costs for defined benefit schemes • Deferred tax, especially on revaluations and discounting of provisions • Financial instruments, especially on accounting for derivatives and investments at fair values • Hedge accounting • Preference shares and convertible bonds • Merger accounting • Goodwill amortisation • Negative goodwill • Investment properties, especially the treatment of revaluations • Proposed dividends • Finance leases – some operating leases under UK GAAP may be finance leases under IFRS There are many differences in wording and emphasis in the two sets of standards even when the overall treatment of items is broadly the same and these differences can be significant in borderline decisions. The disclosures required under UK GAAP and IFRS are different in some cases. What is going to happen to UK GAAP? All UK companies not using IFRS for their accou
