Document ID: chunk:federal_register_of_legislation:F2025C00209:reg:221:p32
Version: federal_register_of_legislation:F2025C00209
Segment Type: reg
Provision Reference: reg 221 (pt 32/73)
Character Range: 250917–254078

for SMEs Standard does not permit the capitalisation of borrowing costs and therefore does not require any additional disclosures. As this is an R&M difference, the Board decided to require disclosure of the amount of capitalised borrowing costs on the grounds that total interest is an important element for a user to understand liquidity and solvency of an entity, and that information about these amounts capitalised would therefore be relevant. The Board further considered that the benefits of this disclosure would exceed the cost, noting that it is was also required for RDR entities.

      6.             Based on the principle to avoid differences to the IFRS for SMEs Standard as far as possible, the Board decided to retain certain disclosures even though they were not required for RDR entities. These include:

               1.                     in relation to the section covering employee benefits, disclosures about termination benefits which are over and above what is required under full IFRS/AAS (paragraphs 173(d),(g), 174-175);
               2.                    disclosures about the entity's domicile and other general information (paragraph 32), the qualitative factors that make up goodwill (paragraph 142(g)), adjusting events that occurred after the end of the reporting period (paragraph 185) and parent-subsidiary relationships where an entity applies the exemption from providing related party disclosures for government-related entities (paragraph 200);
               3.                     disclosures about hedging (paragraphs 121 and 122), investments in associates (paragraph 126) and leasing (paragraphs 144(b), 147(d) and 148(b)) where some disclosures were added but many others removed as a result of applying the principles in paragraph BC41; and
               4.                    a number of disclosures in relation to the section covering transition to Australian Accounting Standards – Simplified Disclosures – see paragraph BC100 for details.

      7.             While acknowledging stakeholders concerns about the potential increase in disclosures, the Board noted that the small increases will be more than offset with the reduction in disclosures in other areas. On this basis, the Board agreed to retain the disclosures from IFRS for SMEs Standard, which have been demonstrated to be appropriate for small and medium sized entities without public accountability. However, consistent with the principles in paragraph BC40, the Board agreed to remove disclosures about specific components of capitalised defined benefit cost, group plans and other long-term benefits from the disclosures proposed in ED 295 as these disclosures had been included in full IFRS when the IFRS for SMEs Standard was first issued, but had since been removed from full IFRS.

      8.             In relation to the adjusting events after the end of the reporting period, the Board noted that paragraph 185 specifically refers to an update of 'related disclosures', which is different to the equivelant requirements in AASB 110 Events after the Reporting Period, where paragraph 8 requires the adjustment of amounts recognised