UK/IRELAND - The Accounting Standards Board is currently sounding out opinion on proposed changes to accounting standards for UK and Irish companies.
It has proposed a three-tier approach, with listed companies applying the standard IFRS, most other companies adopting the new IFRS version for smaller companies, and small companies continuing to use the financial reporting standard for smaller entities.
The ASB has chosen to introduce a consultation process now - open for responses until February 1, 2010 - after the publication of the IFRS standard for SMEs in July.
Lane Clark & Peacock said one outcome of the proposals is that many companies currently accounting for pensions under the UK pension standard FRS17 could use IAS19 from 2012. The proposals also increase the importance of the new IFRS for SMEs.
LCP partner Matthew Pearlman said: "On our first glance at IFRS for SMEs, the reduced version seems very similar to IAS19.
"The one thing which will be different for UK companies going from FRS17 to IFRS for SMEs is potentially the way that surpluses can be recognised on the balance sheet, which is fairly different in UK and international accounting standards."
While under the full IFRS if there are three companies in a group, all participating in a pension scheme, the costs can all be allocated to one company and the other two account for what they actually paid in. For IFRS for SMEs, companies account for what they pay in.
PricewaterhouseCoopers partner Brian Peters said: "The problem is no one knows what was intended by that or how pension accounting is going to work.
"The situation at this stage is there isn't going to be much change as far as pensions are concerned."
Pearlman also expects little to come out of the consultation that affects accounting for pensions.
"Firstly because there isn't a lot of difference between the two standards and secondly I think it will be swamped by differences in other areas," he added.
Local government minister Rishi Sunak says his department's priority is to make a success of local government pension pooling, warning there is no room for complacency.
The Association of Consulting Actuaries (ACA) has appointed its first female chair, Jenny Condron. Victoria Ticha speaks to her about the key pension issues that must be addressed and how to bridge the industry's gender gap
In this week's Pensions Buzz, we want to know whether you agree with MPs that enhanced powers for The Pensions Regulator (TPR) will only be effective if there is also a cultural change at the watchdog.
Smart Pension has appointed ClaritEx to develop its cost transparency solutions effective from Q3, making the master trust its first client.