Given the significant changes to International Financial Reporting Standards over the last few years, we are still in a period of rest in relation to our International Standard equivalents. However, there are some substantial changes for certain entities who may no longer be able to prepare special purpose financial statements.
The standards which are mandatorily effective for the first time at 30 June 2022, and a brief explanation of the changes, are shown in the table below:
|New standard||Description||Overview of changes
|AASB 1060||General Purpose Financial Statements – Simplified Disclosures for For-Profit and Not-for-Profit Tier 2 Entities||Introduces a new Tier 2 general purpose financial report which includes the recognition, measurement, consolidation and equity accounting requirements from the principal standards, however presentation and disclosure requirements are provided in AASB 1060.
|AASB 2021-1||Amendments to Australian Accounting Standards – Transition to Tier 2: Simplified Disclosures for NFP Entities||Provide an option for NFP entities who transition from one form of general purpose financial statements to Tier 2 Simplified Disclosure financial statements prior to 1 July 2021 to not include comparatives where those entities did not previously present the information.
|AASB 2020-2||Amendments to Australian Accounting Standards – Removal of Special Purpose Financial Statements for Certain For-Profit Private Sector Entities||Requires for-profit private sector entities who are either:
- Required by legislation to prepare financial statements in accordance with Australian Accounting Standards or Accounting Standards OR
- Required by a constituting or other document to prepare financial statements in accordance with Australian Accounting Standards and that document was created or amended after 1 July 2021
to prepare general purpose financial statements from 30 June 2022.
Refer to previous newsletters for further discussions on these topics.
|AASB 2020-7 / AASB 2021-3||Amendments to Australian Accounting Standards – COVID-19 Related Rent Concessions||Allow rent deferrals / waivers due to COVID-19 received on or before 30 June 2022 to be treated as variable lease payments rather than a modification of the lease.
|AASB 2020-9||Amendments to Australian Accounting Standards – Tier 2 Disclosures: Interest Rate Benchmark Reform (Phase 2) and Other Amendments||Provides relevant disclosures for Tier 2 entities who are affected by the interest rate benchmark reform.
The AASB has also recently issued AASB 2022-3 Amendments to Australian Accounting Standards – Illustrative Examples for Not-for-Profit Entities accompanying AASB 15. Includes an additional example on factors to consider when accounting for upfront fees as well as an amendment to the Basis of Conclusions to allow private sector not-for-profit entities to use cost or fair value for the measurement of the right of use assets arising from concessionary leases on a permanent basis.
For resources to assist with your year-end tax planning, visit our EOFY portal.
Disclaimer: This information is general in nature and should not be relied on as advice. It does not take into account the objectives, financial situation or needs of any particular person. You need to consider your financial situation and needs and seek professional advice before making any decisions based on this information.