News alert / New subsidiaries accounting standard issued

09 May 2024

The International Accounting Standard Board has issued a new accounting standard IFRS 19 Subsidiaries without public accountability: disclosures. It applies to subsidiary bodies that have an ultimate or intermediate parent body that produces consolidated financial statements in accordance with international financial reporting standards (IFRS). Further eligibility criteria include not having debt or equity instruments that are traded on the public market or not having assets held in a fiduciary capacity for banks or credit unions as its primary business.

Where an entity elects to apply IFRS 19 then it does not need to apply all the IFRS disclosure requirements, instead it makes reduced disclosures. The standard is intended to allow subsidiaries to align their accounting policies with the group and, therefore, maintain a single set of accounts.

The standard is applicable for periods beginning on or after 1 January 2027, but early application is allowed. Before the standard is applied by NHS bodies it will need to be endorsed by the UK Endorsement Board and adopted and adapted for public sector use by the Treasury in the Financial reporting manual (FReM).