New Accounting Options For Year Ended 31 December 2017

IASSA and the Companies (Accounting) Act 2017 have provided companies with new options for accounting for their 31 December 2017 year ended accounts.

FRS 105 is now available for micro entity’s where 2 of the following 3 criteria apply for the current and proceeding year; turnover of less than €700,000, gross assets of €350,000 and less than 10 employees.

FRS 105 contains simpler accounting policies appropriate for smaller entities.

Section 1A of FRS 102 is now available for small entity’s where 2 of the following 3 criteria apply for the current and proceeding year; turnover of less than €12,000,000, gross assets of €6,000,000 and less than 50 employees.

Section 1A uses the same accounting policies as full FRS 102, however less disclosures are required.

The table below sets out the main differences between FRS 105, Section 1A of FRS 102 and full FRS 102.

What questions do you have?

We are happy to help. Please post your comment below or contact our friendly and knowledgeable team on 01 677 9000 or email: info@cooneycarey.ie

To keep in touch, connect with our friendly team on LinkedIn.

If you found this article interesting, please share it with other businesses. 

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    Posted on March 22, 2018 by Cooney Carey

    Blockchain part 1 of 6

    Overview

    Blockchain is an operating system like Microsoft Windows or MacOS. Blockchain is a shared ledger that enables the process of recording transactions and tracking assets. These assets can be tangible items such as a house or intangible item such as copyrighting and patents. Blockchain can enable any item of value to be tracked and traded. Bitcoin is just one example of the many applications that can be run through this operating system.

    Improving Efficiencies in the Business Network 

    The traditional method of recording transactions and tracking assets involved the participants of a network keeping their own ledger. This process was expensive as it needed the involvement of intermediaries, which in turn lead to fees being charged. Blockchain can alleviate this process as participants are able to share a ledger. Once the ledger is shared it can be updated through peer to peer replication. This means that each participant in the network acts as both publisher and a subscriber. Blockchain implements a consensus model to validate information, meaning transactions are secure and verifiable.

    Key Characteristics of Blockchain

    1. Consensus – All participants on the network must agree authenticity of the transactions.
    2. Authentication – Participants must verify where the asset came from and track its ownership over time.
    3. Unchangeable – Once a transaction has been recorded in a ledger it cannot be altered. If a transaction is posted in error; A new transaction must be posted to amend the error.
    4. Completeness – The shared ledger is the one place to go to establish the ownership of an asset or the completion of a transaction.

    What questions do you have?

    We are happy to help. Please post your comment below or call Jack Gahan from Corporate Finance Team on 01 677 9000. Alternatively, send him an email: jgahan@cooneycarey.ie

    To keep in touch, connect with our friendly team on LinkedIn.

    If you found this article interesting, please share it with other businesses. 

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      Posted on March 19, 2018 by Jack Gahan

      Valuing Your Business

      What approach to use: A valuation approach is the method used to determine the fair market value of a business.

      The most common approaches are:

      Market approach

      The market approach is based on finding prices for comparable businesses or transactions in the public or private markets and using them to infer the value of the business or transaction. Two methods to determine the market value of a business are:

      • Current market value: applicable if stock is actively traded in the stock market.
      • Comparable: identify a publicly traded business with comparable characteristics and calculate multiples based on the performance

      Income approach

      The income approach is based on determining future earnings and calculating the present value. Two common approaches are:

      • Discounted cashflow method: Involves projecting future cashflows, income and expenditure. Calculating a terminal value and discounting them to present value.
      • Capitalised cashflow method: A shortened version of discounted cashflow where both the growth and discount rate as assumed to remain constant into perpetuity

      Asset approach

      This is based on the value of business being equal to the sum of all the parts of the business. Adjusting book value of each asset or liability to fair market value.

      So, which do you use: it depends on the specific circumstances of the business being valued.

      Do you have any questions?

      We are happy to help. Please post your comment below or call Lisa Byrne, Audit Manager at Cooney Carey, on 01 677 9000. Alternatively, send her an email: lbyrne@cooneycarey.ie 

      If this article helped you, please share it with others.

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        Posted on March 14, 2018 by Lisa Byrne

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