FRC extends application period for accounting requirements covering COVID-19 related rent concessions
09 Jun, 2021
The Financial Reporting Council (FRC) has issued 'Amendments to FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland and FRS 105 The Financial Reporting Standard applicable to the Micro-entities Regime - COVID-19-related rent concessions beyond 30 June 2021.
Amendments have been made to the requirements originally introduced into FRS 102 and FRS 105 in October 2020, regarding accounting for temporary rent concessions for operating leases occurring as a direct consequence of the COVID-19 pandemic. The Amendments extend the requirements to apply to rent concessions that reduce only lease payments originally due on or before 30 June 2022 provided the other conditions for applying the requirements are met.
The FRC considers that, as pandemic restrictions continue, extending the existing time condition by 12 months is necessary to ensure these concessions are accounted for consistently and in a way that best reflects their substance.
The amendments are effective for accounting periods beginning on or after 1 January 2021, with early application permitted.
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