The Association of Chartered Certified Accountants (ACCA) has said a proposed new statement of recommended practice (SORP) for pensions accounting in the UK and Ireland should be adopted, but warned that existing reporting requirements could be confusing unless changed.
The ACCA and its pensions technical advisory group welcomed the SORP consultation devised by the Pensions Research Action Group (PRAG) on the recommended practice for financial reports of pension schemes.
It said: “The ACCA agrees with much of the PRAG’s objectives, including that of not extending reporting requirements beyond those of the Financial Reporting Standard (FRS) 102.”
The proposed SORP gave more guidance for preparers of pension scheme accounts under FRS 102, which it said was already a standard that offered conciseness.
“However, the ACCA has responded to the 127-page consultation with detailed specific concerns, including that confusion could arise unless there is a change to existing, and now outdated, statutory reporting requirements for investment disclosures,” it said.
The association said the PRAG was now liaising with the Department for Work & Pensions (DWP) with the aim of overhauling the prescriptive disclosures in the Audited Accounts Regulations, and said the ACCA wholeheartedly supported the lobbying of the DWP to get the changes in place as soon as possible.
Paul Cooper, corporate reporting manager at the ACCA, said: “For the ACCA, the accounting standard FRS 102 and the SORP need to offer a realistic approach to reporting on pensions for the benefit of trustees, employers, investors and pension holders themselves.”
The proposed SORP did help to meet these aims, he said, but added that there was work to be done in practice.
“The SORP needs to be implemented as smoothly as possibly by preparers,” he said.