Owning a rental flat or warehouse through your company means choosing between two accounting models under IAS 40 that can produce wildly different profit figures. This article unpacks the cost model versus the fair value model with a real £350,000 worked example, showing exactly how valuation swings hit your balance sheet, your profit and loss account, and your corporation tax computation.
A £40,000 delivery van sitting at £15,000 on your balance sheet is not a sign of a mistake or a slump in market value — it is net book value at work, spreading the van's cost over its useful life rather than tracking what it would fetch at resale.
Learn how to build a consolidated balance sheet step by step using a real worked example: a parent company acquiring a 100%-owned £1.8m subsidiary. See exactly how the investment elimination, goodwill calculation and equity adjustments work, so your group accounts balance correctly instead of double-counting assets.
When a sale becomes highly probable, IFRS 5 changes everything about how you account for the assets involved. This article walks through a worked example of reclassifying a £220,000 delivery fleet as held for sale, covering the four recognition tests, the impairment calculation, journal entries, and the common mistakes that catch SME owners off guard during due diligence.
A modest 10% sales dip can slash profit by 40% in businesses with heavy fixed costs. This article unpacks operating leverage with a worked £300,000 fixed-cost example, showing why fixed costs amplify profit swings and how SME owners can stress-test their own exposure before committing to leases or headcount.
A £45,000 subcontractor invoice with zero VAT on it is not a mistake — it is the VAT Domestic Reverse Charge at work. Here is how the DRC shifts VAT accounting from subcontractor to contractor, with a worked example, journal entries, and the invoicing mistakes that trip up both sides.
Owning a rental flat or warehouse through your company means choosing between two accounting models under IAS 40 that can produce wildly different profit figures. This article unpacks the cost model versus the fair value model with a real £350,000 worked example, showing exactly how valuation swings hit your balance sheet, your profit and loss account, and your corporation tax computation.
When an SME has outstanding share options, a single EPS figure does not tell the whole story. Using a £2m profit and 500,000 options as a worked example, this guide explains how basic and diluted EPS are calculated under IAS 33, why the treasury stock method matters, and what the dilution gap means for investors, lenders and buyers.
Granting EMI share options feels like a cash-free way to reward senior staff, but accounting standards say otherwise. Learn how IFRS 2 and FRS 102 require you to expense a £40,000 EMI grant over its vesting period, with worked journals, a leaver pitfall, and the deferred tax issue most SMEs miss.
A £12,400 fake supplier invoice almost slipped through accounts payable with a near-identical company name, a one-character-altered email domain, and a brand-new bank account. Here is how AI pattern recognition scored the invoice 95 out of 100 for fraud risk, held it from the payment run, and how finance teams can build similar controls without slowing down daily operations.
A £180 client dinner claim looked harmless until machine learning read the itemised receipt and caught two hidden policy breaches — excess food spend and non-reimbursable wine — before a single pound was paid out. Here is how AI expense tools protect your cash and your tax position.
A £28,500 batch of customer payments lands in the bank, split across three customers with discounts, bundled invoices and a short payment baked in. Here is exactly how AI cash application software reads remittance data, scores each match, and auto-posts the clean ones in seconds while flagging genuine disputes for a human to chase.
6 min read
The Weekly Accounting Brief
Standards updates, tax guidance, audit insights, and expert commentary — delivered every Tuesday morning.
