By James Maude, Divisional Director – Qualified Finance, SF Recruitment (Manchester)

From 1st January 2026, major changes are coming to FRS 102, and finance leaders across the UK must prepare. The updated standard will bring revenue recognition and lease accounting much closer to IFRS 15 and IFRS 16, creating wide-ranging implications for financial reporting, business performance metrics, and decision-making.

So, what should businesses expect?

Lease Accounting

Most leases will now move onto the balance sheet as right-of-use assets and lease liabilities. This shift will directly impact EBITDA, net debt, interest cover, and debt covenant calculations, meaning finance teams must plan ahead to manage new reporting outcomes and lender discussions.

Revenue Recognition

The introduction of a new five-step model for recognising revenue will require businesses to:

Unbundle contracts

Identify performance obligations

Allocate transaction prices accordingly

This could change the timing of revenue recognition, influencing KPIs, bonus schemes, and even dividend policies. Businesses must be ready for the knock-on effects across performance management and shareholder expectations.

Disclosure Requirements

With new disclosure obligations, finance teams will need systems and processes capable of capturing more granular financial data. This will demand both technical expertise and robust systems implementation.

The Talent Challenge

For finance leaders, the message is clear: navigating these changes will require skilled accountants and finance business partners with practical knowledge of IFRS 15 and IFRS 16. Businesses that act early to strengthen their teams will be better placed to implement the right systems, stay compliant, and avoid disruption.

At SF Recruitment, we’re already supporting organisations in Manchester and across the North West to source finance professionals with the expertise needed to manage these shifts confidently.

If your organisation needs support ahead of the FRS 102 changes in 2026, please get in touch. I can introduce you to the candidates with the skills to guide you through these updates.