New SORP for LLPs

摘要

Recent changes in GAAP will have a radical effect on financial reporting by Limited Liability Partnerships (LLPs). In September, in response to these changes, the Consultative Committee of Accountancy Bodies (CCAB) published an exposure draft proposing amendments to the existing Statement of Recommended Practice (SORP) on Accounting by LLPs. Much of the original SORP published in 2002 remains unchanged. But the provisions of FRS 25 (IAS 32), Financial Instruments: Disclosure and Presentation, and UITF Abstract 39, Members' Shares in Co-operative Entities and Similar Instruments, mean that the CCAB has been forced to reconsider the presentation of members' interests.The result is that members' shares in an entity are equity only 'if the entity has an unconditional right to refuse redemption of the members' shares' (UITF 39, paragraph 7).