Document ID: chunk:federal_register_of_legislation:F2024L00075:reg:38:p26
Version: federal_register_of_legislation:F2024L00075
Segment Type: reg
Provision Reference: reg 38 (pt 26/76)
Character Range: 105166–108318

entities, particularly in the public sector, would need to consider the nature of their activities and the boundaries of the entity to determine if they are superannuation entities or only custodial arrangements.  For example, there may be cases in the public sector where an entity administers information about members and their benefits, but is not liable for paying benefits to members.

Defined contribution member and defined benefit member
BC40            Due to the increasing significance of superannuation entities that have both defined contribution members and defined benefit members, AASB 1056 does not have definitions of 'defined benefit plan' and 'defined contribution plan' (as in AAS 25).  The AASB instead developed definitions of 'defined benefit member' and 'defined contribution member'.  These are based on the AASB 'plan' definitions and the relevant definitions in AASB 119.  These definitions were generally supported in the comments received on ED 179 and ED 223.
BC41            In the context of the Draft AASB 1056 for fatal flaw review, some constituents commented that the AASB should consider using the definition of 'defined benefit member' in the prudential regulation.  However, the AASB concluded that the regulatory definition might change in ways that would not necessarily suit the aims of AASB 1056.  Nevertheless, in terms of the current definitions, the AASB does not expect there to be any difference between those members identified as being either defined benefit members or defined contribution members based on definitions in AASB 1056 and those members identified as being either defined benefit members or defined contribution members based on the defined benefit member definition under prudential regulation.

Applying recognition and measurement requirements in Australian Accounting Standards
BC42            Under AAS 25, a superannuation plan applied other relevant Australian Accounting Standards with the key exceptions of some aspects of: financial statement presentation (defined benefit plans can present a statement of net assets and a statement of changes in net assets), asset measurement (net market value is required), and defined benefit member liability measurement (actuarial valuations performed on at least a triennial basis).
BC43            The AASB decided there are no compelling reasons for retaining this approach and concluded that a superannuation entity should apply the presentation, recognition and measurement requirements in other relevant Australian Accounting Standards, except in relation to:
(a)                   measuring most assets at fair value through profit or loss;[3]
(b)                   presenting a statement of changes in member benefits;
(c)                   measuring defined benefit member liabilities; and
(d)                   measuring liabilities and assets arising from insurance arrangements it might provide to its members.

Measurement of assets at fair value
BC44            AAS 25 required a superannuation plan to measure its assets at market value less costs that would be expected to be incurred in realising the proceeds from their