Document ID: chunk:federal_register_of_legislation:F2019L00828:body:0:p9
Version: federal_register_of_legislation:F2019L00828
Segment Type: other
Provision Reference: 
Character Range: 23364–26330

(AASB 9), AASB 7 Financial Instruments: Disclosures (AASB 7) and AASB 132 Financial Instruments: Presentation. However, those foreign currency derivatives that are not within the scope of AASB 9 (e.g. some foreign currency derivatives that are embedded in other contracts) remain within the scope of AASB 121.
For APRA purposes, equity items must be translated using the foreign currency exchange rate at the date of investment or acquisition. Post-acquisition changes in equity are required to be translated on the date of the movement.
As foreign currency derivatives are measured at fair value, the currency derivative contracts are translated at the spot rate at the reporting date.
Exchange differences should be recognised in profit and loss in the period which they arise. For foreign currency derivatives, the exchange differences would be recognised immediately in profit and loss if the hedging instrument is a fair value hedge. For derivatives used in a cash flow hedge, the exchange differences should be recognised directly in equity.
The ineffective portion of the exchange differences in all hedges would be recognised in profit and loss; and
4.             in relation to financial reports of foreign operations:
A foreign operation is defined in AASB 121 to mean an entity that is a subsidiary, associate, joint venture or branch of a reporting entity, the activities of which are based or conducted in a country or currency other than those of the reporting entity.
     * Exchange differences relating to foreign currency monetary items that form part of the net investment of an entity in a foreign operation, must be recognised as a separate component of equity.
     * Translation of financial reports should otherwise follow the requirements in AASB 121.

Netting
Unless otherwise specifically stated, institutions are allowed to take advantage of netting agreements in relation to disclosure of data items in this form. Institutions are to comply with the prerequisite for netting outlined in Australian accounting standards AASB 7 and AASB 132 and any relevant prudential standards.

Term to maturity
Any references to 'term to maturity' in Reporting Form ARF 322.0 Statement of Financial Position (Consolidated) (ARF 322.0) refer to residual term to maturity.

Basis of preparation
The nature of the disclosure and format of this form may not be strictly consistent with the annual financial statements prepared by the institution. Notwithstanding this, in completing this form (unless otherwise specifically stated for individual items of assets, liabilities or equity), institutions are requested to follow the basis that is used for the preparation of its annual financial statements in accordance with the Australian Accounting Standards, specifically in regard to the:
     * interpretation/definition of specific asset, liability and equity items;
     * appropriate measurement basis for asset, liability and equity items; and
     *