Financial Statements For the year ended
Significant accounting policies
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| 2 Significant accounting policies The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated. (a) Basis of preparation The consolidated financial statements have been prepared in accordance with UK-adopted International Accounting Standards. The consolidated financial statements have been prepared under the historical cost convention, as modified by the revaluation of financial assets and derivative instruments at fair value through profit or loss and the revaluation of the defined benefit pension schemes. (b) Going concern The financial statements have been prepared on a going concern basis. Council Board has assessed the viability of ACCA over a five-year period through the review and approval of the annual budget and five-year projections (plan. The plan includes forecast income statements, forecast balance sheets, cash flow forecasts and key non-financial drivers of performance. Scenarios in relation to the approved budget, a view of a realistic worst case and reverse stress test (designed to fail within 12 months of signing the accounts) were created to test the resilience of ACCA’s plan and understand key financial risks, such as disruption to our examination process, ongoing local control orders restricting future members ability to sit exams, retention of members and future members and unexpected significant tax liabilities. ACCA holds cash and investment reserves and has access to a revolving three-year credit facility, which is available to 15 August 2023, (see note 3) to support any unexpected challenges to the plan. ACCA has not had to draw on the revolving credit facility during 2021/22 and do not expect to draw on it during 2022/23. In our realistic worst-case scenario, ACCA retains a positive cash balance and access to its long-term investments. ACCA has policies and processes in place to manage its cash reserves and regularly considers its corporate risks in the context of exposure to liquidity risk. Council Board believes that ACCA has sufficient financial resources to manage its business risks given the current market conditions and as a result, the going concern basis is considered appropriate. Consequently, Council has a reasonable expectation that ACCA has adequate resources to continue in operational existence for the foreseeable future and that there are no material uncertainties about its ability to continue as a going concern. (c) Critical accounting estimates and judgements The preparation of the consolidated financial statements requires ACCA to make certain accounting estimates and judgements that have an impact on the policies and the amounts reported in the consolidated financial statements. Estimates and judgements are continually evaluated and based on historical experiences and other factors, including expectations of future events that are believed to be reasonable at the time such estimates and judgements are made. Actual experience may vary from these estimates. The estimates and assumptions which have the most significant risk of causing a material adjustment to the carrying amounts of assets and liabilities are discussed below. i) Pension and other post-employment benefits ACCA accounts for pension and other post-employment benefits in accordance with IAS 19. In determining the pension cost and the defined benefit asset/obligation of ACCA’s defined benefit pension schemes, a number of assumptions are used which include the discount rate, salary growth, price inflation, the expected return on the schemes investments and mortality rates. Further details are contained in note 22 to the consolidated financial statements. Association of Chartered Certified Accountants Notes to the Financial Statements for the year ended 31 March 2022 Download 0.68 Mb. Share with your friends:
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