A Complete 2025 Guide To FRS 102 Compliance for TNCs in the UK

For growing Transportation Network Companies (TNCs), staying FRS 102-compliant is essential to maintain accurate reporting and investor confidence. In March 2024, the Financial Reporting Council (FRC) released its second periodic review of FRS 102, introducing significant updates. Most changes take effect for accounting periods starting on or after 1 January 2026, with early adoption available, while new supplier-finance disclosure requirements apply from 1 January 2025. In this guide, we’ll discuss the key updates like  lease accounting changes under FRS 102, how they impact TNC operations, and practical steps to prepare for smooth FRS 102 Compliance for TNCs.

What’s Changing in FRS 102 Compliance For TNCs

Lease accounting changes under FRS 102 – Section 20

Most leases will move onto the balance sheet. TNCs must record a right-of-use (ROU) asset and a lease liability. Short-term leases (12 months or less) and low-value assets may be exempt. This change will increase assets and liabilities and could affect debt covenants.

Revenue Recognition – Section 23

A new five-step revenue recognition model, aligned with IFRS 15, will apply:

1. Identify contracts
2. Identify performance obligations
3. Determine transaction price
4. Allocate price to obligations
5. Recognise revenue when control transfers

TNCs must apply this to ride fees, delivery charges, subscriptions, and promotional pricing.

Other Updates

 FRS 102 now aligns with the IASB’s Conceptual Framework. Section 2A introduces a clearer fair-value definition. New supplier-finance disclosure rules (effective from 2025) require more detail on payment terms and liquidity risk. Updated FRC factsheets offer guidance on implementing Sections 20 and 23.

How TNCs Should Respond

• Lease reviews – catalogue all contracts, renewal terms, and embedded leases.
• Covenant analysis – assess how balance-sheet changes may impact lender agreements.
• Revenue mapping – align data systems with the five-step model.
• Automation – use software to handle ROU asset calculations, revenue allocation, and disclosures.
• Clear disclosures – prepare for expanded transparency requirements.
• Cross-team training – ensure finance, products, and operations share a consistent approach.
• Dual reporting – run FRS 102 and legacy reports in parallel during the transition.

Why This Matters

TNCs depend heavily on leased vehicles, equipment, and technology. Bringing these leases onto the balance sheet changes financial ratios and investor perceptions. Updated revenue rules can alter reported earnings and cash flow patterns. Early preparation avoids disruption and supports stakeholder confidence.

How Apex Accountants Can Help

At Apex Accountants, we provide sector-specific support and accounting services for growing TNCs adjusting to the revised FRS 102. Our services include:

• FRS 102 readiness assessments – identifying key gaps and risks in current reporting.
• Lease accounting implementation – building ROU asset and liability registers and modelling covenant impacts.
• Revenue recognition alignment – mapping every service line to the new performance-obligation framework.
• Automation and system integration – deploying cloud-based tools to streamline calculations and reconciliations.
• Disclosure pack preparation – ensuring supplier finance and other new disclosures are complete, clear, and compliant.
• Training workshops – equipping finance teams and management with practical FRS 102 knowledge.
• Ongoing advisory – providing quarterly reviews, audit-ready reports, and real-time compliance monitoring.

We combine the most recent accounting technology, technical expertise, and experience unique to TNC. That means cleaner data, faster reporting, and fewer surprises at year-end.

Case Study – Preparing a TNC for 2026 FRS 102 Changes

A UK-based ride-hailing platform with over 1,500 vehicles faced challenges in mapping revenue to new FRS 102 rules. Lease obligations were off-balance sheet, and supplier-finance terms weren’t fully documented. Apex Accountants carried out a full compliance readiness review, set up lease accounting software, and redesigned revenue recognition processes. By the next quarter, the client had complete disclosure packs, accurate ROU asset calculations, and parallel GAAP reporting in place, ready for early adoption.

Conclusion 

FRS 102 compliance is not just about ticking a box. It’s about embedding new processes that strengthen decision-making and business resilience. Apex Accountants can guide your company through every step of the 2026 changes – keeping you compliant, efficient, and future-ready through our expert accounting services for growing TNCs.

Contact us today to arrange a confidential discussion about your compliance strategy and see how we can prepare your business for the upcoming changes.