The ICAEW has echoed widespread concern at the Accounting Standards Board’s  proposed removal of the section of the accounting framework designed for smaller organisations.

In a statement, Nick Brooks, a partner at Kingston Smith and chair of the ICAEW charities technical committee, said the group was “broadly supportive of the ASB’s proposed new framework.

However, he added: “We have highlighted concerns from the sector about differing accounting treatments between IFRS and the FRSME on a number of issues and over the impact of the removal of the third tier for the large number of smaller charities.

“We welcome the call for further consultation on this issue.”

Concerns for housing associations

Meanwhile, Jonathan Pryor, director at Smith & Williamson and chair of the ICAEW social housing committee, highlighted a number of issues of particular concern for housing associations.

He said: “These include the inability for tier 2 organisations to capitalise interest or use valuations for fixed assets (other than investment properties) and the complexities arising from the requirements in some circumstances to take movements in fair value of certain financial instruments through the income statement.  

“There are also particular concerns over the treatment of capital grants."