Mha Plc · LSE:MHA
Mha — Technical Presentation (November 2025)
37 slides from Mha's technical presentation, Nov 19, 2025
Slide 1: Key Changes to UK GAAP and FRS 102
Key Changes to UK GAAP and FRS 102 Key Changes and Implementation 19 November 2025
Slide 2: Disclaimer & Copyright
Disclaimer & You shall not copy, make available, retransmit, reproduce, sell, disseminate, licence, distribute, publish, broadcast or otherwise circulate either within your business or for public or commercial Copyright purposes any of (or any part of) these seminar materials provided by MHA Audit S
Slide 3: Feedback & CPD Certificates
Feedback & CPD Certificates This is a CPD Course and provides 1 hour of relevant CPD. Please use our feedback form to request your CPD certificate for attending. Certificates will be sent out by the end of December, once your attendance has been verified. We appreciate all feedback, which helps us t
Slide 4: Thank you for joining us – this webinar is being recorded
Thank you for joining us – this webinar is being recorded. A copy of the slides have been sent to you this morning, and are available to download from our website via the link in the Chat, where you will also find other useful information. Please use the Q&A to ask any questions. We will do our best
Slide 5: Agenda
Agenda Introductions Overview of session Revenue from contracts with customers Accounting for leases in the financial statements of lessees Survey Some “other” important changes to FRS 102 Transition timeline Practical implementation considerations Q&A
Slide 6: Revenue from contracts with customers
Overview of session Revenue from contracts with customers
Slide 7: Recap
Recap ✓ Comprehensive five step model intended to apply to all revenue contracts with customers (in scope) FRS 102.23 ✓ Intention of amendments is to account for the contract whereas current requirements consider the transaction ✓ Introduction of new terminology and way of approaching the accounting
Slide 8: Five step revenue recognition model
Five step revenue recognition model Step Step Step Step Step 1 2 3 4 5 Identify the Identify separate Determine Allocate Recognise revenue contract(s) with the performance transaction transaction price when or as an customer obligations price to performance entity satisfies obligations performance o
Slide 9: Key challenges and judgements
Key challenges and judgements • Demonstrating that the concepts have been applied to the population of revenue contracts • Understanding and applying new terminology • Identifying and accounting for costs of obtaining and fulfilling contracts • Identifying distinct goods or services.
Slide 10: Key challenges and judgements
Key challenges and judgements • Certain performance obligations recognised at a point in time or over time (e.g. access to IP and services) • Accounting policy for variable consideration • Assessing whether high probability that there will be no significant reversal of variable revenues • Modificati
Slide 11: Continued challenges further highlighted by deeper guidance
Continued challenges further highlighted by deeper guidance • Combining and separating contracts • Bundling and unbundling • Accounting for stage of completion of contract (input vs output methods) • Re-estimating contract revenues and revisiting stage of completion • Contingent revenues • Principal
Slide 12: Lease accounting
Lease accounting
Slide 13: Recap
Recap ✓ New accounting model introduced bringing most leases onto the balance sheet ✓ Exemptions are available for short term leases (less than 12 months) and low-value leases ✓ Critical distinction between operating vs finance leases removed for lessees ✓ changes likely to impact the calculation of
Slide 14: Key judgements
Key judgements • Understand: definition of a lease and the lease term • Assess: likelihood of exercise of termination and extension options • Calculate: lease term • Identify: appropriate discount rate(s) • Distinguish: variable lease payments.
Slide 15: Some “other” important changes to FRS 102
Some “other” important changes to FRS 102
Slide 16: Some "other" important changes to FRS 102
Some "other" important changes to FRS 102 • Definition of fair value • Uncertain tax positions • Business combination clarifications • Lessor accounting: existing operating lease vs. Finance lease model largely retained but changes for terminology and sub-lease accounting • Enhanced smaller entity d
Slide 17: Transition timeline
Transition timeline
Slide 18: Transition Requirements - FRS 102
Transition Requirements - FRS 102 The revised version of FRS 102 introduces two specific sets of changes. Must NOT restate comparatives for leases. Catch up adjustment made on first day Uncertain tax treatments – fully Comparative of current period. retrospective unless hindsight involved Period MAY
Slide 19: Practical implementation considerations
Practical implementation considerations
Slide 20: Readiness Checklist
Readiness Checklist 1 Confirm effective dates of amendments 2 Identify and collate all leases 3 Assess completeness of contract documents 4 Decide transition methods for certain amendments 5 Quantify impact on profits, assets and liabilities 6 Train Teams 7 Update systems and controls 8 Draft disclo
Slide 21: Implementation project
Implementation project The initial stage is to perform a health check. The focus of the health check is to perform a high level and holistic assessment of the current underlying ‘operating model’ for delivering compliance with FRS 102. Based on the options and impacts that were identified as part of
Slide 22: Standback assessment
Standback assessment Accounting Identifying where you should be focusing your efforts to identify the financial reporting impact is crucial to setting up a successful transition. Our objective will be to help you identify where your key impact areas are going to be and what judgements you could make
Slide 23: Common Pitfalls
Common Pitfalls • Underestimating the data capture stage • Ignoring the following: covenant implications, effect on bonus plans, distributable reserves • Delaying system set-up until very late in project • Treating as a one-off project • Not involving the right people in the organisation.
Slide 24: Questions
Questions Neil Parsons Head of Financial Reporting and Company Law [email protected]
Slide 25: Save the date: FD Update Course – February 2026
Save the date FD Update Course – February 2026 Date: Thursday 12th February 2026 Time: 8.30am – 12.30pm CPD: 3 hours www.mha.co.uk/events
Slide 26: Appendix
Appendix 26 26
Slide 27: Lease term
Lease term The lease term is the sum of: a) The non-cancellable period; b) Any option to extend if the lessee is reasonably expected to take it; and c) Periods covered by an option to terminate the lease if the lessee is reasonably certain not to exercise the option. Account for the lease over the l
Slide 28: Discounting lease payments
Discounting lease payments Given that lease payments should be recognised at their present value, they should be discounted using one of the following rates: - The interest rate implicit in the lease (if it can be readily determined) - The lessee’s incremental borrowing rate; or - The lessee’s obtai
Slide 29: Revenue: disclosures
Revenue: disclosures Disclose disaggregated revenue from Disclose: contracts with customers into categories which depict how revenue and cash a) revenue recognised from flows are affected by economic factors. contracts with customers, which the entity shall disclose Appropriate categories may includ
Slide 30: Revenue: disclosures
Revenue: disclosures For performance obligations that an For assets recognised from the costs entity satisfies over time disclose the incurred to obtain or fulfil a contract methods it used to recognise disclose: revenue. a) the closing balances of assets An entity shall provide a quantitative recog
Slide 31: Revenue: disclosures
Revenue: disclosures Disclose information on contract Disclose information about assets/liabilities as follows: performance obligations: a) the opening and closing a) when the entity typically satisfies balances of receivables, its performance obligations contract assets and contract b) the signific
Slide 32: Lessees: presentation
Lessees: presentation Present in the balance sheet or the notes: • Right of use (“ROU”) assets separately from other assets or when not presented separately: • include ROU assets in the same line item that the underlying assets would be presented in if they were owned; and • disclose which line item
Slide 33: Lessees: disclosures
Lessees: disclosures Disclose a general description of the entity’s significant leasing arrangements should be provided along with additional qualitative and quantitative information if it is necessary for the users’ understanding. Disclose the following: a) The interest expense on lease liabilities
Slide 34: Lessees: disclosures
Lessees: disclosures Disclose for right-of-use assets by class of underlying asset: • The gross carrying amount and accumulated depreciation at the beginning and the end of the reporting period • A reconciliation of the carrying amount at the beginning and end of the reporting period showing separat
Slide 35: Lessees: disclosures
Lessees: disclosures Where the lessee takes exemptions for short-term leases or the lease of low-value assets, they should disclose the amount of lease commitments for each in relation to the following periods: a) not later than one year b) later than one year and not later than five years; and c) l
Slide 36: Some remaining differences between FRS 102 and IFRS 16
Some remaining differences between FRS 102 and IFRS 16 IFRS 16 New FRS 102 requirements ✓ In calculating the lease liability, IFRS 16 ✓ FRS 102 also requires the use of the lessor’s implicit interest rate if that rate can be requires the use of the lessor’s implicit interest Discount rate readily de
Slide 37: mha.co.uk
mha.co.uk MHA is the trading name of both (i) MHA Audit Services LLP, a limited liability partnership registered in England and Wales with company number OC455542 and (ii) MHA Advisory Ltd, a company registered in England and Wales with company number 16233746. A list of partners' names is open for