According to UK GAAP, what must be disclosed if a new issued standard is not applied?

Under UK GAAP, if a newly issued standard is not applied, it is essential to disclose the reason for non-application. This requirement is rooted in the principles of transparency and accountability in financial reporting. By providing the rationale for not adopting the new standard, organizations enable users of the financial statements to understand the context of the decision-making process and assess the implications for the financial statements.

This disclosure helps ensure that stakeholders are not misled about the financial reporting framework being applied and are made aware of any potential limitations or differences in the comparative information that may affect their analysis or decision-making. It contributes to better clarity in financial communications, aligning with the broader goals of financial reporting to provide relevant and reliable information to users.

While disclosing the financial impact of the standard, future intentions regarding its application, or historical usage of prior standards can enhance understanding, they are not mandated as fundamental disclosures when a new standard is not applied. The key focus is on the reason for not adhering to the new guidance, which directly addresses compliance and the organization’s stance regarding the evolving financial reporting landscape.