Document ID: chunk:federal_register_of_legislation:F2022C01110:reg:20:p23
Version: federal_register_of_legislation:F2022C01110
Segment Type: reg
Provision Reference: reg 20 (pt 23/40)
Character Range: 100662–103629

simultaneously comply with IFRSs.
BC92            Entities that transition to Tier 1 need to apply AASB 1 in full in order to be able to claim compliance with IFRSs, in accordance with AASB 101, including making an unreserved statement of compliance as required by AASB 101.
BC93            The Board considered whether entities transitioning between Tiers for which compliance with IFRSs is not pertinent, in particular NFP entities that are subject to Aus paragraphs, should be subject to AASB 1 on transition.  The Board concluded that AASB 1 is not applicable in those circumstances because, at the time of transition between Tiers, Australian Accounting Standards or Australian Accounting Standards – Reduced Disclosure Requirements, which have common recognition and measurement requirements, have previously been complied with.  Accordingly, it would not be appropriate to imply, through application of AASB 1, that the basis of accounting has changed.

Operative Date
BC94            The Board concluded that mandatory application of Tier 2 requirements should be annual reporting periods beginning on or after 1 July 2013.  The Board noted a long transitional period is particularly required to allow entities that prepare special purpose financial statements to make necessary preparations for transitioning to Tier 2 requirements should they choose to prepare general purpose financial statements under Tier 2.  The Board considered it would be beneficial to have a relatively long transition period to allow these entities to prepare their internal reporting systems for transition.
BC95            However, the Board decided to allow early adoption of Tier 2 requirements for those entities that want to avail themselves of the reduced disclosure requirements under that Tier before the mandatory application date of 1 July 2013.  Early adoption is permitted for annual reporting periods that begin on or after 1 July 2009 but before 1 July 2013.  The Board decided not to permit early adoption for annual reporting periods that begin before 1 July 2009 due to the difficulty of identifying relevant Standards applying to those earlier periods and making consistent judgments as to which disclosures in those Standards would be applicable under Tier 2.
BC96            The Board also noted that a long transition period would potentially enable any outcome of the second stage of the project to be made operative from the same date as the first stage, to facilitate minimal disruption on transition.  The Board will not decide whether the second stage should be progressed until the results of the research project it has commissioned are known.
BC97            The transition period is also consistent with the Board's normal policy regarding transition periods for its Standards.  The Board concluded that making Tier 2 requirements mandatory from the date of issue of relevant Standards may inappropriately require entities that currently apply Tier 1