BusinessCorporate FinanceAccounting change to hit major art galleries

Accounting change to hit major art galleries

National Gallery books stand to lose £55m as a result of proposed change to heritage assets accounting

A change in the way that museums and galleries report their heritage assets
is set to wipe £55m from the National Gallery’s balance sheet if it gets the
go-ahead.

Institutions can show recently acquired heritage pieces at cost, sparking
criticism from the Accounting Standards Board. It said the figures bore ‘little
or no resemblance to an entity’s collection as a whole,’ as it released
Financial Reporting Exposure Draft 40 requiring all assets or none to be
reported at valuation.

Chris Yates, The National Gallery’s director of resources said: ‘At year-end
of March 2006 our recent acquired assets were valued at £55m, that’s a fairly
meaningless figure.’

Yates believes the reform will provide a more accurate impression of
institutions’ accounts: ‘It doesn’t represent the value of collections as a
whole,’ he said.

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