New Financial Reporting Standards are coming into place at the end of 2015/early 2016. The main changes fall under two headings:
Buying or 'merging' companies
The useful life of intangible assets and 'goodwill'
The attached article explains the changes in more detail.
Intangibles are the gold of the 21st century with estimates suggesting that 80% of a listed company’s share price is no longer supported by the presence of tangible assets on its balance sheet. This is not a new problem but it is an evolving finance conundrum for accountants and those seeking to leverage finance against these assets. With Financial Reporting Standard 102 (FRS 102) coming into effect from the end of 2015 (where a company’s accounting year is the calendar year) and April 2016 (where it is the fiscal year) it is about to get a whole lot more important for SMEs who will now follow substantially the same rules as multinationals.