Document ID: chunk:federal_register_of_legislation:F2023L00010:body:0:p93
Version: federal_register_of_legislation:F2023L00010
Segment Type: other
Provision Reference: 
Character Range: 250677–253870

not to provide an option to restate comparative information upon initial application of the Amending Standard.

Not-for-profit private sector entity consideration
BC269        When developing ED 320, the Board observed that limiting the AASB 13 modifications to not-for-profit entities in the public sector might be perceived as being inconsistent with its transaction neutrality policy. Therefore, ED 320 included a question asking respondents whether the proposed modifications to AASB 13 should be applicable also to entities in the not-for-profit private sector. Mixed feedback was received on that ED question.
BC270        The Board decided to limit the scope of this Amending Standard to not-for-profit public sector entities because the Board did not receive any requests for guidance from stakeholders in the not-for-profit private sector during the project. To the date of issuing this Standard, the Board has not been informed that:
(a)                    a significant number of not-for-profit private sector entities measure their non-financial assets at fair value;
(b)                   not-for-profit private sector entities are encountering significant issues with applying AASB 13 in measuring non-financial assets; or
(c)                    some principles of AASB 13 have been applied inconsistently in this sector in measuring non-financial assets (unlike in the public sector).
BC271        The Board noted that limiting the scope of modifications to not-for-profit public sector entities may not necessarily breach its transaction neutrality policy because many assets held by not-for-profit public sector entities are largely unique to the public sector. That is, for many assets, it is unlikely that private sector entities would hold similar assets to those held in the public sector.
BC272        Even if it were considered that limiting the modifications to not-for-profit public sector entities would be inconsistent with the transaction neutrality policy, the Board considered that this would be justified. This is because, unlike public sector entities, private sector entities have a choice to subsequently measure their non-financial assets using the cost model rather than the revaluation model (in AASB 116 or AASB 138 Intangible Assets). This results in non-financial asset values measured using different models among private sector entities' financial statements, thus being less comparable than the asset values reported by public sector entities. Accordingly, applying this Amending Standard, which is limited to measuring non-financial assets using the revaluation model, would not fully achieve comparability among not-for-profit private sector entities in measuring their non-financial assets.
BC273        In accordance with the AASB Not-for-Profit Entity Standard-Setting Framework, for the reasons noted in paragraphs BC270–BC272, the Board determined that a case has not been made for it to undertake standard-setting work to investigate whether there is a need to modify AASB 13 for application by not-for-profit private sector entities.

  [1]  This Guidance Note is not explicitly identified as applying to fair value measurements, or non-fair