Document ID: chunk:federal_register_of_legislation:F2023C00381:reg:8:p10
Version: federal_register_of_legislation:F2023C00381
Segment Type: reg
Provision Reference: reg 8 (pt 10/28)
Character Range: 187491–190549

entities are more likely to have users that are dependent on the entity's GPFS. Further, the Explanatory Statement also noted that the average access rates for financial reports through ASIC for the remaining population of large proprietary companies is significantly higher than for those entities that would now be small proprietary companies (see paragraph BC40(c)).

          The Board considered that such economically significant companies are expected to have sufficient skills and resources to cope with any transitional challenges within the current requirements.

          (b)                   Findings from Research Report 12: One of the key findings of this research is that overall it is estimated that 76% of specified for-profit entities lodging SPFS with ASIC comply with the R&M requirements in AAS; 10% did not comply with the R&M requirements in AAS, while for the remaining 14% it was unclear whether or not they complied with the R&M requirements in AAS. As noted in paragraph BC124, entities already applying all of the R&M requirements of AAS would not require transitional relief.

          While the Board noted that these results focused only on compliance with R&M requirements in their lodged SPFS and therefore did not identify whether entities prepared consolidated financial statements, the results show that out of approximately 7,295[46] for-profit entities lodging SPFS with ASIC following the revision of the large proprietary company thresholds, only 10% to 24% (approximately 600 to 1,700 entities) are expected to be affected by this Standard. This is because 76% of the specified for-profit entities lodging SPFS with ASIC are already complying with the R&M requirements in AAS. The Board also noted that this number may be further reduced as the research showed a clear correlation between entity size and compliance with the R&M requirements in AAS, with the level of compliance increasing with company size.

          Further, the Board noted that the primary reason for 6% of entities that did not comply with the R&M requirements in AAS was due to not applying AASB 112 in full, however constituents have not raised AASB 112 as being problematic for the purpose of transition.

          (c)                    Insufficient compelling evidence from extensive outreach: The Board performed extensive outreach and asked for specific information on transitional relief that might be needed through formal comments on ITC 39, roundtables in capital cities and over 200 meetings with individual stakeholders, and did not receive compelling evidence or suggestions identifying specific issues that needed transitional relief. Further, no specific feedback was received from small foreign-controlled proprietary companies or unlisted public companies not limited by guarantee.

          (d)                   The AASB's For-Profit Entity Standard-Setting Framework: The Board noted the presumption that IFRS Standards are appropriate as a base for all entities, with particular regard to the fact that AASB 1, which