ECL26700 | ECL example: accounting period ending within 3 months of the end of the financial year, regulated for only part of the financial year

If there is no accounting period which ends within the financial year, you must instead use the accounting period which ends within 3 months of the end of the accounting period. If the person is regulated for only part of the financial year, the ECL liability is reduced (see [ECL25000])

Beta Ltd’s first accounting period ends of 30 April 2023, so there is no accounting period ending within the 2023 financial year. S56(5)(a) therefore applies. The relevant AP is taken as the AP that ends during the period of 3 months beginning with the end of the FY 1 April 2022 to 31 March 2023, so 1 May 2022 - 30 April 2023.

Beta Ltd was, however, only a regulated business from 1 January 2023, which is 90 days from the end of the financial year on 31 March 2022. Beta Ltd’s ECL liability is apportioned on this daily basis, using 90/365 multiplied by the band range liability.

Assuming that Beta Ltd falls within the £10,000 medium band range, this would mean that the ECL payable is £2,465.