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.
Click on one of the Newsletter sections below:
| Top Story |
| Local Reporting |
| Regulations |
| International News |
| In case you missed it |
AASB Board meeting - April 2022
The agenda and papers for the AASB’s Board meeting on 7 April are available. Key topics to be discussed include:
- Not-for-Profit Private Sector Financial Reporting Framework;
- Responses on ED 318 Illustrative Examples for Income of Not-for-Profit Entities and Right-of-Use Assets arising under Concessionary Leases; and
- AASB’s sustainability reporting project.
AASB staff webinar – Income of not-for-profit entities
A recording of the AASB staff’s recent webinar explaining the interaction of AASB 1058 and AASB 15 is now available. Some of the topics discussed included:
- The enforceability criteria for arrangements to be recognised under AASB 15;
- Identifying sufficiently specific performance obligations;
- Principal vs agent considerations;
- Accounting for capital grants and up-front fees.
A copy of the slides can be found here. The AASB Staff FAQs for not-for-profits entities has also been updated and a key facts document provides a high-level overview of the accounting for income of NFP entities.
Amendments for Initial Application of AASB 17 and AASB 9 – Comparative Information
The AASB issued AASB 2022-1 to provide insurers with a transition option relating to comparative information about financial assets presented on the initial application of AASB 17. The amendments relate to financial assets for which comparative information presented on initial application of AASB 17 and AASB 9 has not been restated for AASB 9.
The transition option permits an entity to present comparative information about such a financial asset as if the classification and measurement requirements of AASB 9 had been applied to that financial asset. The amendments applies to annual periods beginning on or after 1 January 2023, with early adoption permitted.
AASB’s new high priority project - Sustainability Reporting
Following feedback from ITC 46 AASB Agenda Consultation 2022–2026 regarding its proposed sustainability reporting project, the AASB has formally added the Sustainability Reporting project to its work plan with a high priority.
To help AASB staff develop a draft project plan, the Board made the following preliminary decisions:
- The work of the International Sustainability Standards Board (ISSB) should be used as the foundation, with modification made only for Australian matters and requirements to meet the needs of Australian stakeholders
- Work of existing sustainability reporting standard setters and framework providers can be leveraged in developing any modifications for Australian-specific circumstances
- The initial scope of the project is for for-profit entities of all sizes and not just larger listed entities. The not-for-profit sector will be considered at a later stage.
Director ID Number Reminder
First time directors of entities registered under the Corporations Act 2001 who are appointed from 5 April 2022 are reminded that they need to obtain a Director ID Number (Director ID) before their appointment.
Applications are made through the Australian Business Registry Services (ABRS).
Employee or contractor? – the goalposts have shifted
Treating someone as an independent contractor instead of an employee could lead to a number of adverse consequences. David Montani, Nexia Australia National Tax Director, examines the implications of two recent court cases.
ASIC allows additional time for holding virtual-only meetings
Under ASIC Corporations (Virtual-only Meetings) Instrument 2022/129, all listed companies and listed and unlisted registered schemes, will continue to have the option to hold virtual-only meetings until 31 May 2022 (an additional two months). For unlisted companies, the extension is until 30 June 2022, which aligns with the extended deadline for unlisted public companies with 31 December 2021 year ends to hold their AGMs.
To apply the relief, a resolution must be passed that it is unreasonable to hold a meeting of its members wholly or partially at one or more physical venues, due to the impact of the COVID-19 pandemic.
Electronic signing of documents and hybrid meetings
Amendments to the Corporations Act allows companies and registered schemes to hold hybrid meetings (which give shareholders the option of either attending in person or remotely) and use technology to execute company documents, sign meetings-related documents and provide those documents to their members.
The amendments are contained in Corporations Amendment (Meetings and Documents) Act 2022 and replaces previous temporary measures introduced as a result of COVID-19 restrictions.
New domain name changes put business and organisations at risk
From 24 March 2022, businesses, associations and individuals or anyone with a local connection to Australia will be able to register a new category of domain name that ends in .au rather than .com.au.
Although this simplifies domain names, this new option may create an avenue for cyber criminals to impersonate business and organisations.
The Australian Cyber Security Centre (ACSC) recommends that all Australian businesses with existing domain names register their .au equivalents before 20 September 2022. If a business does not reserve their .au equivalent domain name during this six-month period, that name will become available to the general public on a first come, first served basis.
IFRIC Update
A summary is available of the IFRS Interpretations Committee meeting held on 15-16 March 2022. The Committee reached tentative agenda decisions on:
- Lessor Forgiveness of Lease Payments (IFRS 9 and IFRS 16);
- Transfer of Insurance Coverage under a Group of Annuity Contracts (IFRS 17);
- Special Purpose Acquisition Companies (SPAC): Classification of Public Shares as Financial Liabilities or Equity (IAS 32); and
- Special Purpose Acquisition Companies (SPAC): Accounting for Warrants at Acquisition.
The Committee also finalised its agenda decision, which has been forwarded to the IASB for approval, on:
- Demand Deposits with Restrictions on Use arising from a Contract with a Third Party (IAS 7).
IASB Update
A summary is available of the IASB meeting held on 22-24 March 2022 which discussed a number of topics including:
- Financial Instruments with Characteristics of Equity;
- Proposals for a revised practice statement on management commentary;
- Its plan to develop requirements or guidance to improve disclosures exploration and evaluation expenditure and activities; and
- General presentation and disclosure requirements of primary Financial Statements.
International Sustainability Standards Board
The IFRS Foundation, CDP and the Climate Disclosure Standards Board (CDSB) recently formed a new International Sustainability Standards Board (ISSB) to develop IFRS Sustainability Disclosure Standards.
The ISSB has now published for comment:
- Exposure Draft IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information, which sets out the overall requirements for disclosing information about an entity’s significant sustainability-related risks and opportunities; and
- Exposure Draft IFRS S2 Climate-related Disclosures, proposing the specific requirements for the identification, measurement and disclosure of climate-related financial information.
Next Newsletter - Summer Edition
A recording of Nexia’s 2022 Budget webinar exploring what the key Budget announcements mean for businesses, business owners, and high net worth individuals, is now available.
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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.
