15/02/2016

15/02/2016

Is your company ready for FRS 102? – Key Management

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Part 11- Disclosure of key management personnel compensation

A new requirement under FRS 102 is that key management personnel compensation should be disclosed in the financial statements. The definition of “Key Management” is open to interpretation and is defined in the standard as follows; “Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the entity, directly or indirectly, including any director (whether executive or otherwise) of that entity”. Companies will have to make a call on which staff members constitute “key management” and the total amount paid or payable to these individuals will then have to be disclosed in the financial statements. Compensation includes all employee benefits received in exchange for services rendered to the entity. It also includes compensation paid on behalf of a parent of the entity in respect of goods or services provided.

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