Document ID: chunk:federal_register_of_legislation:F2025C00209:reg:221:p46
Version: federal_register_of_legislation:F2025C00209
Segment Type: reg
Provision Reference: reg 221 (pt 46/73)
Character Range: 289363–292444

does not become operative until annual reporting periods beginning on or after 1 July 2021. The specified operative date for the amendments made by this Standard therefore could not be earlier than 1 July 2021. However, the Board considered that entities should be required to apply these amendments earlier if they apply both:

          (a) AASB 1060; and

          (b) the practical expedient in paragraph 46A of AASB 16;

     to a reporting period beginning before 1 July 2021.

Basis for Conclusions on AASB 2020-9

This Basis for Conclusions accompanies, but is not part of, AASB 1060.  The Basis for Conclusions was originally published with AASB 2020-9 Amendments to Australian Accounting Standards – Tier 2 Disclosures: Interest Rate Benchmark Reform (Phase 2) and Other Amendments.

Introduction

 1.                This Basis for Conclusions summarises the Australian Accounting Standards Board's considerations in reaching the conclusions in this Standard. It sets out the reasons why the Board developed the Standard, the approach taken to developing the Standard and the bases for key decisions made. In making decisions, individual Board members gave greater weight to some factors than to others.

Tier 2 Simplified Disclosures – amendments to AASB 1060

 1.                In September 2020, the Board issued AASB 2020-8 Amendments to Australian Accounting Standards – Interest Rate Benchmark Reform – Phase 2 to help entities to provide financial statement users with useful information about the effects of the interest rate benchmark reform on those entities' financial statements. New paragraphs 24I and 24J were added to AASB 7 Financial Instruments: Disclosures to require an entity applying the amendments to disclose information about:

          1.                     the nature and extent of risks to which the entity is exposed arising from financial instruments subject to interest rate benchmark reform, and how the entity manages these risks; and

          2.                    the entity's progress in completing the transition to alternative benchmark rates and how the entity is managing the transition.

 2.                The amendments also give relief from providing the information otherwise required by AASB 108 Accounting Policies, Changes in Accounting Estimates and Errors paragraph 28(f) in the reporting period in which the entity first applies the amendments made by AASB 2020-8 through new paragraph 44HH of AASB 7.

Reasons for not adding any disclosures to AASB 1060

 1.                The Board considered whether the new disclosures should also apply to entities that intend to adopt AASB 1060 General Purpose Financial Statements – Simplified Disclosures for For-Profit and Not-for-Profit Tier 2 Entities. The Board referred to the principles used when developing the disclosures in AASB 1060, in particular:

          1.                     the disclosures in the IFRS for SMEs Standard should be retained where the recognition and measurement (R&M) requirements and options are the same or similar in the IFRS for SMEs