Statements of Recommended Practice (SORPs)
Overview
Statements of Recommended Practice ("SORPs") are developed in the public interest and set out current best accounting practice. SORPS, issued by ‘SORP-making bodies’ are intended to supplement accounting standards and other legal and regulatory requirements to reflect transactions or circumstances that are unique within specialised industries or sectors. SORPs are issued on subjects on which it is not considered appropriate to issue an accounting standard at the time.
SORPs cannot be taken as authority to depart from the requirements imposed by accounting standards, nor to extend the scope of accounting standards to include entities or circumstances which are otherwise excluded from specific accounting standards or accounting standards in general.
To be recognised as a SORP-making body, a particular industry or sectoral body must meet criteria set by the Financial Reporting Council (FRC) and must agree to develop and maintain SORPs in accordance with the Policy on developing SORPs. A SORP must carry a Statement by the FRC confirming, as appropriate, that the SORP does not appear to contain any fundamental points of principle that are unacceptable in the context of current financial reporting practice, auditing practice or actuarial practice, nor does it conflict with an FRC standard or undermine the FRC’s broader objectives.
The latest FRC policy on developing SORPs is available on the FRC website here.
Scope
SORPs exist for a range of specific entities and industries. More detail is given below. If a type of entity falls within the scope of a SORP, its financial statements should be prepared in accordance with FRS 102 and that SORP.
Summary
The latest SORPS and their effective dates are detailed in the table below.
Name | Latest version | Effective date (reporting periods beginning on or after) | |
---|---|---|---|
Accounting and reporting by charities FRS 102 | 2019 | 1 January 2019 | |
Accounting for further and higher education * | 2019 | 1 January 2019 and * | |
Accounting by Limited Liability Partnerships (LLPs) ** | 2021 | 1 January 2022 | |
Accounting by Social Housing providers *** | 2018 | 1 January 2019 and *** | |
Financial reports of pension schemes | 2018 | 1 January 2019 | |
Financial statements of authorised funds **** | 2014 | 1 January 2015 | |
Financial statements of investment trust companies and venture capital trusts | 2022 | 1 January 2022 |