SSAP 9 has been superseded by FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland for accounting periods beginning on or after 1 January 2015. For more information visit:

• icaew.com/newukgaap

Synopsis

• Stocks should be stated at the lower of cost and net realisable value.
• Long term contracts should be assessed on a contract by contract basis and turnover and related costs recognised as activity progresses.
• Where the contract outcome can be assessed with reasonable certainty prudently calculated profit should be recognised in the profit and loss account as the difference between turnover and related costs.
• In the balance sheet turnover in excess of payments on account should be classified as "amounts recoverable on contracts".
• Any excess of payments on account should be classified as such within creditors.
• The amount classified within stocks as long term contracts is costs incurred less amounts transferred to cost of sales less foreseeable losses and payment on account not matched with turnover.
• Any foreseeable loss should be recognised immediately in the profit and loss account. 

• Read FRC Summary on SSAP 9

Last updated 21 June 2015