ACCT 1208 · Statutory Accounts: Putting It All Together

Led by Fra Luca de Pacioli Simulacrum

1. Module 8 ○ Open

   Statutory Accounts: Putting It All Together

   Led by Fra Luca de Pacioli Simulacrum

   The question

   The full set of UK statutory accounts as a structured document. The module covers the components (strategic report, directors' report, four primary statements plus notes, and the audit report when required), the audit thresholds (turnover £10.2m, balance-sheet £5.1m, 50 employees — meet two of three), the small-company and micro-entity regimes (FRS 1020 1A, FRS 1050), the directors' report content, the strategic-report requirements for medium and large entities, post-balance-sheet events (adjusting vs non-adjusting under IAS 10), and the going-concern statement and what it requires. The closing exercise reviews a draft set of statutory accounts.

   Outcome

   The student can describe the components of a complete set of UK statutory accounts, identify which thresholds determine which regime applies, recognise the role of the directors' report and strategic report, distinguish adjusting from non-adjusting post-balance-sheet events, and articulate the directors' responsibility for the accounts.

   Begin the course → Mark module complete Print certificate of completion

   Practice scenarios

   Reviewing a Draft

   You have been given a draft set of statutory accounts for a UK private company (turnover £14m, balance sheet total £8m, 60 employees — therefore subject to full audit). The company has had a difficult year — revenue down 12%, a major customer in administration owing £180k, a planned restructuring that has not yet been formalised, a major regulatory investigation that is not yet concluded. Your job is to review the draft and identify five things that need to be addressed before sign-off.

   Your goals

   • Identify the audit-threshold position: above all three thresholds — full audit required, the auditor's report must be included.
   • Identify the bad-debt issue: the £180k customer in administration probably needs to be written off (not provisioned) — a known loss, not a doubtful debt.
   • Identify the restructuring issue: as in Module 5, no provision can be recognised because there is no detailed formal plan communicated to those affected. Ensure no £-million restructuring charge has been included; if it has, it must be removed.
   • Identify the regulatory investigation: this is a contingent liability — disclose in the notes (nature, uncertainty, possible financial effect or a statement that estimation is impractical), but do not recognise unless an outflow becomes probable and the amount can be reliably estimated.
   • Identify the going-concern question: with revenue down 12% and a major customer in administration, the directors must explicitly assess and confirm the going-concern basis. The auditor will require a robust going-concern paper — cash-flow forecasts for at least twelve months, sensitivity analysis, headroom against banking covenants.
   • Identify the strategic-report content: the principal risks section must address the regulatory investigation (the going-concern adviser will require it) and the customer concentration risk.

   Practise this scenario →