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CIPFA/LASAAC issue new Code of Practice on Local Authority Accounting

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10 Apr 2018

The Chartered Institute of Public Finance and Accountancy (CIPFA) and the Local Authority (Scotland) Accounts Advisory Committee (LASAAC) have issued the 2018/19 Code of Practice on Local Authority Accounting in the UK (the Code) which would apply to accounting periods beginning on or after 1 April 2018.

Local authorities in the United Kingdom are required to keep their accounts in accordance with ‘proper (accounting) practices’. This includes compliance with the terms of the Code of Practice on Local Authority Accounting in the United Kingdom prepared by the CIPFA/LASAAC Local Authority Accounting Code Board (CIPFA/LASAAC).

The Code specifies the principles and practices of accounting required to prepare financial statements which give a true and fair view of the financial position and transactions of a local authority.

Significant updates to the 2018/19 Code, which was consulted on in July 2017, include:

  • Updates to incorporate the Code’s adoption of IFRS 9 Financial Instruments. The Code will adopt the new classification and measurement requirements for financial assets, the new expected credit loss impairment model and the new disclosure requirements arising from the adoption of IFRS 9.
  • Updates for the adoption of IFRS 15 Revenue from Contracts with Customers including consequential amendments as a result and additional guidance on the principles of revenue recognition. The Code will adopt the recognition and disclosure requirements of IFRS 15.
  • Updates for narrow scope amendments to International Financial Reporting Standards (IFRSs)

The Code applies formally in Great Britain to local authorities, fire authorities (England and Wales), joint committees and joint boards of principal authorities. In Northern Ireland it applies to all district councils. The Code also applies to police and crime commissioners and other police bodies, as relevant.

A full version of the Code can also be obtained on the CIPFA/LASAAC website (requires payment).

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