Document ID: chunk:federal_register_of_legislation:F2023C00382:reg:66:p7
Version: federal_register_of_legislation:F2023C00382
Segment Type: reg
Provision Reference: reg 66 (pt 7/8)
Character Range: 328226–331331

insurance contracts that are substantively similar to those entered into by for-profit entities.  Accordingly, the AASB decided not to restrict NFP private sector entities from applying AASB 17, rather allowing those entities to decide to apply AASB 17 prior to 1 January 2021.  However, the AASB may propose additional application guidance, where necessary, as part of the forthcoming ED on Australian-specific issues arising from AASB 17, the aim of which is to be operative before the mandatory application date of AASB 17.
AusBC30               The AASB also noted that for-profit public sector entities could enter into arrangements that exhibit characteristics of insurance contracts but are entered into through legislative means as opposed to contractual means.  These types of arrangements will also be considered in the AASB's forthcoming ED on Australian-specific issues.  However, for-profit public sector entities are not prohibited from applying AASB 17 as their not-for-profit counterparts are.

Implications for RDR
AusBC31               At the time of issuing AASB 17, the AASB was in the process of reviewing its Tier 2 decision-making framework and RDR for existing Standards through ED 277 Reduced Disclosure Requirements for Tier 2 Entities (issued in January 2017).  Accordingly, the AASB decided not to consider any new pronouncements for RDR concessions until that review is finalised.  Consistent with this decision, AASB 17 and its consequential amendments do not include any RDR concessions.
AusBC32               Once the AASB has finalised its Tier 2 decision-making framework it will make RDR proposals, where appropriate, for AASB 17 and its consequential amendments.

Basis for Conclusions
This Basis for Conclusions accompanies, but is not part of, AASB 17.  The Basis for Conclusions was originally published with AASB 2022-8 Amendments to Australian Accounting Standards – Insurance Contracts: Consequential Amendments.

Introduction
     BC1               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 key decisions made. In making decisions, individual Board members gave greater weight to some factors than to others.

Reasons for issuing this Standard

Consequential amendments for public sector entities
     BC2               Prior to these amendments, for-profit public sector entities were required to apply AASB 17 Insurance Contracts for annual periods beginning on or after 1 January 2023. However, the Board decided to defer the mandatory application date of AASB 17 for for-profit public sector entities to annual periods beginning on or after 1 July 2026. Therefore, the Board issued this Standard to amend relevant Australian Accounting Standards so that for-profit public sector entities would be permitted to continue applying AASB 4 Insurance Contracts and AASB 1023 General Insurance Contracts until required to apply AASB 17. The Board