This guide explains what FRS 101 is, which entities may use it, and how to prepare FRS 101 accounts in Bright Accounts Production (Bright AP).

What is FRS 101?

FRS 101 is the Reduced Disclosure Framework. It allows qualifying companies to prepare individual financial statements using adopted IFRS recognition and measurement requirements, while taking advantage of certain permitted disclosure exemptions and relevant UK company-law adjustments.

FRS 101 is intended for the individual financial statements of qualifying subsidiaries and qualifying ultimate parent companies.

Important: Being part of a group does not automatically mean that an entity qualifies for FRS 101. Confirm that the company meets the qualifying conditions before selecting the framework.

Who can use FRS 101?

FRS 101 may be appropriate for:

• Qualifying subsidiaries whose parents prepare publicly available consolidated financial statements, where the relevant conditions are met.
• Qualifying ultimate parent companies prepare individual, parent-only financial statements, where the relevant conditions are met.

FRS 101 should not be used for:

• Company that do not meet the FRS 101 qualifying-entity definition or the applicable conditions.
• Consolidated financial statements. FRS 101 disclosure exemptions apply to qualifying company’ individual financial statements, not their consolidated financial statements.
• Company that have not met the applicable eligibility, shareholder-notification/non-objection, or disclosure-exemption conditions.

Before selecting FRS 101, confirm that:

• The accounts are individual financial statements, not consolidated financial statements.
• The parent and group arrangements meet the qualifying-entity requirements, including relevant requirements concerning publicly available consolidated financial statements.
• Applicable shareholder notification and non-objection requirements have been considered and satisfied where required.

Selecting FRS 101 in Bright AP

FRS 101 is available as a reporting framework within the Company template.

 
Select the appropriate FRS 101 option when setting up or amending the company’s reporting framework, but only after eligibility has been confirmed.

Once selected, Bright AP applies the chosen framework when producing the accounts. The software selection does not confirm that the entity is eligible or that each disclosure exemption is available.

Preparing FRS 101 accounts

Before finalising the accounts:

1. Check eligibility – Confirm that the entity is a qualifying entity, that the statements are individual financial statements, and that all relevant conditions are met.
2. Review accounting policies – Ensure policies reflect the applicable adopted IFRS recognition and measurement requirements, including relevant UK company-law modifications.
3. Review disclosure exemptions – Confirm that each exemption is permitted and its conditions are met. Retain all disclosures required by FRS 101, company law and other applicable requirements.
4. Review the notes – Check that the notes are complete and appropriate for the entity. Depending on the circumstances, these may include:
5. Accounting policies
6. Share capital and reserves
7. Related party disclosures
8. Employee benefits
9. FRS 101-specific wording and notifications

Important: FRS 101 does not remove all IFRS disclosures. Exemptions are specific and may be conditional; check the relevant requirements and retain all disclosures that remain mandatory.

Common FRS 101 disclosure areas

Review the following areas where applicable:

• Cash flow statement – A qualifying entity may be exempt from presenting a cash flow statement in its individual financial statements, subject to the relevant FRS 101 conditions.
• Financial instruments – Check the specific exemptions and restrictions. Some exemptions are unavailable to financial institutions, and mandatory disclosures must be retained.
• Related parties – Apply only the relevant exemption and confirm its conditions. Do not remove disclosures solely because FRS 101 is being used.
• Other IFRS disclosures – Check each relevant exemption against the current edition of FRS 101 and any applicable amendments; retain all required disclosures.

Final account checks

Before finalising the accounts, check that:

• Primary statements agree with the accounting records and comply with applicable Companies Act and regulations.
• Totals and subtotals are correct, and any omitted or suppressed lines are not required by the applicable reporting requirements.
• Notes agree with the primary statements and contain all required disclosures.
• Shareholder notification – applicable notification and non-objection requirements have been met before relying on FRS 101 disclosure exemptions.

Important

The availability of the FRS 101 template in Bright AP does not determine whether an Company qualifies to use the framework or whether a particular disclosure exemption applies.

Use FRS 101 only where the qualifying conditions are met and each exemption relied upon is available and properly supported.