Document ID: chunk:federal_register_of_legislation:F2022C01110:reg:20:p25
Version: federal_register_of_legislation:F2022C01110
Segment Type: reg
Provision Reference: reg 20 (pt 25/40)
Character Range: 106155–109256

reduce compliance costs for entities operating across the Tasman and support trans-Tasman investment through the consistency of financial statements.  The use of full IFRSs as the foundation standards in both countries provides a sound basis for achieving the above Outcome Proposals.  However, further harmonisation in regard to financial reporting by entities other than those that are required to apply full IFRSs as adopted in Australia would be necessary to achieve the Outcome Proposals.  This would be achieved by convergence of the differential reporting frameworks in the two countries.
BC103        New Zealand already adopts a differential reporting regime (that is different from the regime in Australia both before and after AASB 1053), which is expected to undergo restructuring in the light of the New Zealand Ministry of Economic Development review of standard setting arrangements.  Close monitoring of these developments by the two countries would help identify an appropriate approach to converge the differential reporting frameworks in the two countries in due course.
BC104        The convergence of differential reporting frameworks is likely to be conducted in stages, with the first stage relating to for-profit private sector entities.  New Zealand is expected to employ a notion of public accountability that is close to the IASB's definition to distinguish between for-profit entities that apply NZ IFRSs and those that can avail themselves of concessions under the differential reporting framework.  The AASB noted that the use of the IASB's notion of public accountability under Tier 2 requirements in Australia provides common ground to discuss the harmonisation of the two countries' differential reporting frameworks in regard to for-profit private sector entities.

Basis for Conclusions on AASB 2014-2
This Basis for Conclusions accompanies, but is not part of, AASB 1053.  The Basis for Conclusions was originally published with AASB 2014-2 Amendments to AASB 1053 – Transition to and between Tiers, and related Tier 2 Disclosure Requirements.

Background
BC1               This Basis for Conclusions summarises the Australian Accounting Standards Board's considerations in reaching the conclusions in the Standard.  Individual Board members gave greater weight to some factors than to others.
BC2               In June 2012 the Board issued AASB 2012-5 Amendments to Australian Accounting Standards arising from Annual Improvements 2009–2011 Cycle incorporating the IASB Standard Annual Improvements to IFRSs 2009–2011 Cycle.  The amendments AASB 2012-5 made to AASB 1 First-time Adoption of Australian Accounting Standards relate to an entity returning to Australian Accounting Standards that previously applied Australian Accounting Standards or IFRSs, but in its most recent previous annual financial statements did not include an explicit and unreserved statement of compliance with Australian Accounting Standards or IFRSs.  Irrespective of whether AASB 1 has previously been applied, the amendments permit such an entity to apply AASB 1, or the option under