Document ID: chunk:federal_register_of_legislation:F2024L00075:reg:38:p33
Version: federal_register_of_legislation:F2024L00075
Segment Type: reg
Provision Reference: reg 38 (pt 33/76)
Character Range: 125344–128427

were also concerned an entity might be permitted or required to present its liabilities for defined contribution and defined benefit members' benefits as a single line item under the ED 179 proposals.  The AASB noted, because defined contribution member liabilities are different in nature and would be measured on a different basis from defined benefit member liabilities; consistent with the approach in paragraph 59 of AASB 101 and, when appropriate, the entity would present separately its liabilities for the two types of benefits.
BC75            Several respondents suggested that a statement of changes in equity would not provide sufficient useful information to users in a superannuation context to justify the cost of preparation and audit.  They suggested the information that would otherwise be presented in a statement of changes in equity be included in:
(a)                   the statement of changes in member benefits because equity in a superannuation context is normally small (if not immaterial) and in most cases would comprise reserves that will ultimately be used for the benefit of members; or
(b)                   a note to the financial statements.
BC76            The AASB concluded it should require the recognition of the difference between total assets and total liabilities in the statement of financial position and require a statement of changes in equity.  However, the AASB noted that there may be situations when a statement of changes in equity may not be material.
BC77            The AASB also concluded that, consistent with the sentiments in paragraphs 5 and 6 of AASB 101, superannuation entities should employ terminology that best suits their circumstances.  Accordingly, superannuation entities might use a term such as 'reserve' rather than 'equity' in referring to line items or in naming statements.

Income statement
BC78            The AASB considered whether superannuation entities should present a single statement of profit or loss and comprehensive income or a single statement of comprehensive income in accordance with AASB 101 and concluded neither would be appropriate in a superannuation context because:
(a)                   all remeasurement changes in assets and liabilities, other than tax items credited or charged directly to member benefits, should be recognised in an income statement in the period they occur; and
(b)                   'comprehensive income' encompasses items that would not be recognised in equity in a superannuation context and, accordingly, requiring a statement of comprehensive income may be misleading.

Income and expense items
BC79            Under AAS 25, superannuation entities recognise all income and expense items, including remeasurements of assets at net market value, in profit or loss when they occur.
BC80            The AASB considered the merits of retaining this approach and noted that defined contribution members may choose between superannuation entities based on investment returns.  In addition, some employer-sponsors of entities with defined benefit members would