Electricity & Gas Update - Issue 3

 

November 2008

 

Adopting IFRS in UK subsidiaries

 

As you may be aware, the UK Accounting Standards Board has recently signalled that, as early as 2011 and, in all likelihood by 2013, UK GAAP will be replaced by full International Financial Reporting Standards (IFRS) and the new form of IFRS being developed for private entities. In this issue we consider some of the issues associated with the adoption of IFRS (primarily associated with a deficit in distributable reserves) in the UK subsidiary accounts of electricity and gas companies. We are aware that a number of utility companies have already initiated reductions of capital to improve their distributable reserves position and it is now possible to do this by way of solvency statements as an alternative to the Court based route. If you would like to discuss any of the matters raised in this publication further, please let us know. Our industry contacts are listed on the back page and would be delighted to discuss further