We held a meeting earlier this year in response to a number of queries we've received around accounting for Voluntary Right to Buy sales.
Since the Voluntary Right to Buy (VRTB) agreement was reached in 2015, the government has set up two pilot schemes to help test how it will work in practice, and ensure a smooth experience for tenants.
Since August 2018 we've been working with housing associations in the Midlands to test the application of the VRTB policy.
Through the course of the pilot, we've received a number of queries regarding accounting for VRTB sales. No specific guidance has been released and the Ministry for Housing, Communities and Local Government (MHCLG) has said this is a matter for organisations and their auditors to agree.
A meeting to discuss this was held on Thursday 23 January 2020 at KPMG’s offices in Birmingham which was attended by representatives from housing associations in the Midlands participating in the pilot, the associated audit firms and the NHF.
There are various documents available which detail the arrangements and reporting requirements for the Midlands pilot. The following guidance was considered at the meeting, alongside accounting standards FRS 102 and the Housing SORP.
A summary of what was discussed is detailed below.
We've created this example of how accounting for VRTB sales works in practice.