Following the publication of the International Financial Reporting Standard for Small and Medium-sized entities ("IFRS for SMEs"), the Accounting Standards Board ("ASB") is proposing to replace UK GAAP with this standard. The FRSSE will be retained for small entities. This change is expected to first apply to 31 December 2012 year-ends.
ASB envisages that UK GAAP under the proposals would be:
| Framework | Accounting regime | Type/Nature of Entities | Implications for |
| IFRS | IFRS (EU Adopted) | EU listed-consolidated AIM | |
| UK GAAP | IFRS (EU Adopted) | Publicly accountable inc.100% owned publicly accountable subsidiaries | Investment Trusts; Building societies; Friendly societies; Subsidiaries with listed debt |
| IFRS for SMEs | Large and Medium NPAEs (Non-Publicly Accountable Entities) | NPA groups NPA entities NPA subsidiaries |
|
| FRSSE | Small |
Under the proposals all entities will have the option (similar to the current arrangements, with the exception of charitable companies) to voluntarily adopt a high tier.
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