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Reporting deadline for grandfathered proprietary companies
ASIC has clarified that a grandfathered proprietary company that uses the one month extension for completing its financial reporting obligations for a year ended between 24 June 2022 and 7 July 2022 will no longer be exempt and will be required to lodge its financial report with ASIC.
To remain exempt from lodging its 30 June 2022 financial report, a grandfathered company must meet all of the legislative requirements for the exemption including completing its reporting obligations within the statutory deadline – being four months after balance date.
Further information can be found in the new addendum at the end of ASIC media release 22-187MR.
Changes to ACNC reporting requirements in the 2022 AIS Hub
The ACNC is urging charities to view guidance and tips in assisting the completion of the 2022 Annual Information Statement (AIS) through the AIS Hub.
The hub also provides further information for charities on recent changes to their reporting obligations. Amongst others, this includes new charity size thresholds, new requirements to report key management personnel salaries and remuneration for large entities.
The hub also has a tool to preview the relatively new charity programs section of the AIS, so charities can become familiar with what is required and make the most of the opportunity to promote their work to donors, grant makers and volunteers.
Illustrative financial report for a school adopting AASB 1060
Nexia is pleased to release its SDS School Example Limited illustrative financial report for the year ended 31 December 2022.
The financial report illustrates an independent school adopting the Tier 2 Simplified Disclosure Standard AASB 1060 for the first time and reporting under the Australian Charities and Not-for-profits Commission Act 2012.
AASB releases its Tier 3 Simplified Accounting for Not-for-Profit Private Sector Entities Discussion Paper
The Discussion Paper addresses a proposed Tier 3 general purpose financial reporting framework for NFP entities.
Tier 3 is designed to be relevant to smaller NFP entities, such as medium ACNC entities and other smaller NFPs reporting under other legislation, when the AASB removes the ability of NFPs to prepare special purpose financial reports.
The Discussion Paper proposes a number of simplified measurement and recognition requirements as an alternative to IFRS measurement and recognition, and reduced disclosures compared to Tier 2 general purpose financial statements.
Feedback on the proposals can be made either formally or via a survey and the AASB will be holding a series of virtual outreach events between October 2022 and March 2023 to discuss the proposals.
Submissions on the Discussion Paper close on 31 March 2023.
Increased reporting thresholds for WA Associations
Amendments have been made to the Associations Incorporation Regulations 2016 (WA) to increase the financial reporting thresholds for Western Australia associations and align them with the ACNC reporting tiers.
The new thresholds are effective for financial years ending on or after 13 August 2022. The thresholds have increased as follows:
- Tier 1: less than $500,000 revenue (was less than $250,000 revenue);
- Tier 2: $500,000 to less than $3m revenue (was $250,000 to less than $1m revenue); and
- Tier 3: $3m or more revenue (was $1m or more revenue).
AASB Board meeting – September 2022
A summary of the AASB’s meeting held on 21 September 2022 is available.
Key topics discussed include:
- Fair Value Measurement for Not-for-Profit Public Sector Entities; and
- Not-for-Profit Domestic Post-implementation Reviews. The Board intends to issue two Invitations to Comment (ITCs) for a 150-day comment period. One ITC will address the topic of income of NFP entities. The second ITC will address the topics of control and consolidation and other matters.
Queensland interstate properties land tax
From 30 June 2023, Queensland land tax will be calculated by reference to the total value of Australian land. This includes taxable land in Queensland and relevant taxable interstate land.
The total value of your Australian land will be used to determine:
- whether the Queensland tax-free threshold has been exceeded; and
- the rate of land tax that will be applied to the Queensland proportion of the value of your total landholdings.
Land tax is only payable on the land owned in Queensland (i.e. land outside Queensland is not being taxed in Queensland).
The current tax-free thresholds are $600,000 for individuals (other than absentees) and $350,000 for companies, trustees and absentees.
IFRIC Update - September 2022
A summary is available of the IFRS Interpretations Committee (IFRIC) meeting held on 13 September 2022.
The Committee finalised its agenda decision, which has been forwarded to the IASB for approval, on:
- Multi-currency Groups of Insurance Contracts (IFRS 17 and IAS 21)
- Special Purpose Acquisition Companies (SPAC): Accounting for Warrants at Acquisition
- Lessor Forgiveness of Lease Payments (IFRS 9 and IFRS 16).
IASB Update – September 2022
A summary is available of the IASB meeting held on 20-22 September 2022 which discussed a number of topics including:
- Financial Instruments with Characteristics of Equity. The IASB tentatively decided to propose amendments to IAS 32 Financial Instruments: Presentation to clarify the accounting for financial instruments containing obligations for an entity to redeem its own equity instruments, including written put options on non-controlling interests;
- The objective, activities and an anticipated time line for the Post-implementation Review of IFRS 15;
- Application questions relating to the partial disposal of investments in associates and accounting for other changes to the investor’s ownership interest in an associate accounted for under the equity method;
- Clarifications to the requirements in IFRS 9 Financial Instruments for assessing whether a financial asset’s contractual cash flow represents solely payments of principal and interest, and the treatment of financial assets with non-recourse features;
- Proposed amendments to IFRS 3 disclosures relating to business combinations and goodwill, and assessing impairment; and
- Redeliberate the proposals in its Exposure Draft General Presentation and Disclosures.
International Sustainability Standards Board (ISSB) Update
The ISSB met on 20-23 September 2022 when it discussed:
- The summary of comments on its Exposure Draft IFRS S1 (draft S1) and Exposure Draft IFRS S2 (draft S2);
- The proposed plan for redeliberating draft S1 and draft S2;
- Exploring amending the proposals in draft S1 and draft S2 to address scalability; and
- Matters raised in the feedback on the proposals for financed and facilitated emissions in draft S2 and the preliminary proposed approach to redeliberations following that feedback.
Amendments to IFRS 16 Leases – lease liability in a sale and leaseback
The IASB has issued amendments to IFRS 16 Leases to clarify the accounting for sale and leaseback transactions after the date of the transaction.
The amendment clarify that an entity determines ‘lease payments’ on the leaseback in a way that does not result in the recognition of a gain on the sale of an asset that relates to the right of use it retains.
Director ID deadline looms
Directors who were appointed on or before 31 October 2021 have until 30 November this year to apply for a Director Identification Number (Director ID). If you haven’t yet applied, you are strongly encouraged to do so now.
Other deadlines are:
- Intending new directors under the Corporations Act must apply (or have an existing Director ID) before their appointment;
- New directors appointed for the first time between 1 November 2021 and 4 April 2022 should have applied already – they had 28 days from their appointment to apply (unless they have an existing Director ID).
Directors of an Aboriginal or Torres Strait Islander corporation registered under the Corporations (Aboriginal and Torres Strait Islander) Act 2006 who were appointed on or before 31 October 2022 have until 30 November 2023 to apply, while those appointed from 1 November 2022 must apply before their appointment.
There are significant criminal and civil penalties for failing to obtain a Director ID when required or misusing Director IDs.
For more information about who needs to apply and how, visit the Australian Business Registry Services website.
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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.
