Welcome to Beyond the Numbers, our monthly newsletter which brings you a summary of the latest developments from local and international standard setters and regulators.
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| Top Story |
| Local Reporting |
| Regulations |
| International News |
Timing Differences Between Initiation And Receipt Of Electronic Cash Transfers
At its June meeting IFRIC finalised its agenda decision on when an entity would derecognise a trade receivable and recognise cash where there is a delay between the customer initiating an electronic cash transfer and the entity receiving the funds.
IFRIC determined that the entity only has the contractual right to obtain cash from the bank for cleared amounts deposited with that bank and, consequently, the entity would derecognise the trade receivable and recognise cash when that cash is recognised in its bank account.
The agenda decision may affect how some entities account for cash in transit at balance date.
The agenda decision has been forwarded to the IASB for its approval and is expected to be published in July.
Financial Reporting Changes for AFS Licensees
ASIC issued guidance on which Australian Financial Services (AFS) Licensees must prepare Tier 1 general purpose financial statements (GPFS) for financial years ending on or after 30 June 2022, and provided transitional disclosure relief for certain other AFS licensees.
AASB Board meeting - June 2022
A summary of the AASB’s meeting held on 22 – 23 June 2022 is available.
Key topics discussed include:
- Not-for Profit Private Sector Financial Reporting Framework; and
- Sustainability Reporting.
The AASB also finalised AASB 2022-4 Accounting Policy Disclosures in Special Purpose Financial Statements of Certain For-Profit Private Sector Entities.
Additional Disclosures Required For Some Special Purpose Financial Statements
The AASB has issued AASB 2022-4 Amendments to Australian Accounting Standards – Disclosures in Special Purpose Financial Statements of Certain For-Profit Private Sector Entities, which is applicable for 30 June 2022.
The standard applies to for-profit private sector entities that are required only by their constituting document or another document created before 1 July 2021 (and not amended on or after that date) to prepare financial statements that comply with “Australian Accounting Standards” and are non-reporting entities that prepare special purpose financial statements (SPFS) for 30 June 2022.
The amendments require those financial statements to disclose:
- the basis upon which the decision to prepare SPFS was made; and
- information about the material accounting policies applied in the SPFS, including the extent of compliance or otherwise of those accounting policies with the recognition, measurement, consolidation and equity accounting requirements in Australian Accounting Standards.
ASIC Calls For Enhanced Business Risk and Asset Values Disclosure
ASIC has called for better disclosure of business risks and asset values in the financial report as better information about uncertainties, key assumptions, business strategies and risks are important to stakeholders.
ASIC notes that companies will continue to be affected differently by uncertainties about future economic and market conditions and disclosure of relevant information assists financial statement users.
ASIC’s focus areas for 30 June 2022 financial reports are contained in media release 22-124MR ASIC highlights focus areas for 30 June 2022 reporting.
Superannuation Guarantee Percentage
A reminder that from 1 July 2022, the Superannuation Guarantee percentage increased from 10% to 10.5%, and the requirement to pay superannuation only where an employee earned $450 or more a month has been removed.
Updated Guidance for Corporate Collective Investment Vehicles
ASIC has released materials and updated to a number of key regulatory guides to assist the licensing and other requirements for corporate collective investment vehicles (CCIVs).
This includes Information Sheet 272 How to register a corporate collective investment vehicle and sub-fund (INFO 272) which provides guidance on:
- CCIV and initial sub-fund registration requirements;
- the application process, including how ASIC will assess applications for CCIVs and initial sub-funds;
- CCIV Constitution and compliance plan requirements; and
- the application process for registering further sub-funds.
Updated ePayments Code
ASIC has published the updated ePayments Code to provide enhancements to and clarity on a number of existing protections for consumers.
In addition to extending the Code to cover payments made using the New Payments Platform, ASIC has also updated the following areas of the Code:
- compliance monitoring and data collection;
- mistaken internet payments;
- unauthorised transactions;
- complaints handling; and
- facility expiry dates.
The changes strengthen the Code’s protections by removing ambiguity and expanding protections.
Post-implementation Review of IFRS 10, IFRS 11 and IFRS 12
The IASB has issued its Project Report and Feedback Statement concluding its Post-implementation Review (PIR) of IFRS 10 Consolidated Financial Statements, IFRS 11 Joint Arrangements and IFRS 12 Disclosure of Interests in Other Entities.
Some respondents to the PIR asked for further guidance to help assess control. However, the IASB acknowledged that assessing control requires judgement and decided against providing more guidance relating to the definition of control.
Topics identified as low priority for further consideration by the IASB included:
- transactions that change the relationship between an investor and an investee;
- transactions that involve ‘corporate wrappers’;
- collaborative arrangements outside the scope of IFRS 11.
IFRIC Update - June 2022
A summary is available of the IFRS Interpretations Committee (IFRIC) meeting held on 14-15 June 2022.
The Committee reached tentative agenda decisions on:
- Multi-currency Groups of Insurance Contracts (IFRS 17 and IAS 21)
The Committee also finalised its agenda decision, which has been forwarded to the IASB for approval, on:
- Negative Low Emission Vehicle Credits (IAS 37)
- Special Purpose Acquisition Companies (SPAC): Classification of Public Shares as Financial Liabilities or Equity (IAS 32)
- Transfer of Insurance Coverage under a Group of Annuity Contracts (IFRS 17)
IASB Update – June 2022
A summary is available of the IASB meeting held on 20-22 June 2022 which discussed a number of topics including:
- Post-implementation Review of IFRS 9;
- Financial Instruments with Characteristics of Equity;
- Equity Method;
- Primary Financial Statements; and
- Business Combinations under Common Control.
NZ - Amendments to Public Benefit Entities (PBE) Standards
The New Zealand Accounting Standards Board has made the following amendments to PBE Standards which apply to reporting periods beginning on or after 1 January 2023:
- For Tiers 1 and 2 Not-for-Profit PBEs: Initial Application of PBE IFRS 17 and PBE IPSAS 41 – Comparative Information
- For Tiers 1 and 2 Public Sector and Not-for-Profit PBEs: 2022 Omnibus Amendments to PBE Standards
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If you would like to discuss further any of the information provided in these updates and how it may impact you, please contact your Nexia Advisor.
