Document ID: chunk:federal_register_of_legislation:F2023L01377:body:0:p3
Version: federal_register_of_legislation:F2023L01377
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that fair value as the deemed cost in its opening Australian-Accounting-Standards statement of financial position because of severe hyperinflation (see paragraphs D26–D30), the entity's first Australian-Accounting-Standards financial statements shall disclose an explanation of how, and why, the entity had, and then ceased to have, a functional currency that is subject to severe hyperinflation. has both of the following characteristics:
(a) a reliable general price index is not available to all entities with transactions and balances in the currency.
(b) exchangeability between the currency and a relatively stable foreign currency does not exist.
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Effective date
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39AI AASB 2023-5 Amendments to Australian Accounting Standards – Lack of Exchangeability, issued in October 2023, amended paragraphs 31C and D27. An entity shall apply those amendments when it applies AASB 121 The Effects of Changes in Foreign Exchange Rates (as amended in October 2023).
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Appendix D
Exemptions from other Australian Accounting Standards
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Severe hyperinflation
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D27 The currency of a hyperinflationary economy is subject to severe hyperinflation if it has both of the following characteristics:
(a) a reliable general price index is not available to all entities with transactions and balances in the currency.
(b) exchangeability between the currency is not exchangeable into and a relatively stable foreign currency does not exist. Exchangeability is assessed in accordance with AASB 121.

Amendments to AASB 121
Paragraphs 8 and 26 are amended. Paragraphs 8A–8B and 19A and their related headings, paragraphs 57A–57B and 60L–60M and Appendix A are added. New text is underlined and deleted text is struck through. For ease of reading, text in Appendix A has not been underlined.
Following the IASB's addition of Appendix A to IAS 21, Appendix A Australian simplified disclosures for Tier 2 entities to AASB 121 is relabelled as Appendix B. The Appendix is also amended. New text is underlined.

Definitions
8 The following terms are used in this Standard with the meanings specified:
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A currency is exchangeable into another currency when an entity is able to obtain the other currency within a time frame that allows for a normal administrative delay and through a market or exchange mechanism in which an exchange transaction would create enforceable rights and obligations.
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Elaboration on the definitions

Exchangeable (paragraphs A2–A10)
8A An entity assesses whether a currency is exchangeable into another currency:
(a) at a measurement date; and
(b) for a specified purpose.
8B If an entity is able to obtain no more than an insignificant amount of the other currency at the measurement date for the specified purpose, the currency is not exchangeable into the other currency.
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Estimating the spot exchange rate when a currency is not exchangeable (paragraphs A11–A17)
19A An entity shall estimate