Document ID: chunk:federal_register_of_legislation:F2023C00188:reg:7:p88
Version: federal_register_of_legislation:F2023C00188
Segment Type: reg
Provision Reference: reg 7 (pt 88/91)
Character Range: 248637–251761

(a)                    timing of recognition of income tax revenue – income tax revenue is recognised under GFS in advance of AASB 1058 (see Appendix C of AASB 9);

(b)                   timing of recognition of property tax revenue – property tax revenue is recognised under GFS later than AASB 1058 (see Appendix C of AASB 9).  The Board considered constituent feedback that GFS requires income to be recognised progressively over the period of the levy;

(c)                    timing of revenue recognition on transfer of goods – GFS generally recognises revenue on legal change in title, while AASB 1058, with limited exception, requires income to be recognised on recognition of the asset.  Under Australian Accounting Standards, an entity must control the asset for recognition to occur, which could be at a point in time earlier than on legal change in title;

(d)                   recognised income for certain volunteer services received – GFS does not recognise any income representing the fair value of volunteer services received; and

(e)                    recognition of provisions in accordance with AASB 137 Provisions, Contingent Liabilities and Contingent Assets – the amount of income recognised under GAAP and GFS will differ where a provision relating to the transaction or event is recognised in accordance with Australian Accounting Standards but not under GFS.

BC175        The Board weighed its policy on GAAP/GFS harmonisation against its policy of transaction neutrality.  The Board observed that some areas of potential difference were known when developing AASB 1049.  Others were more likely to give rise to differences only in interim reporting periods, or are driven by a difference in the underlying principles.  Further, some differences could only be addressed by making changes to the underlying principles in AASB 1058 and AASB 15.

BC176        On balance, the Board considered that it was not necessary to amend its decisions reflected in AASB 1058 in order to achieve GAAP/GFS harmonisation.  The Board noted that AASB 1049 Whole of Government and General Government Sector Financial Reporting will require entities to identify and explain any differences arising from different requirements in GAAP as compared to GFS.

Comparison with International Public Sector Accounting Standards

BC177        As part of its deliberations, the Board considered the accounting for income of not-for-profit entities specified by the International Public Sector Accounting Standards Board (IPSASB).  The Board noted the following International Public Sector Accounting Standards (IPSAS) specified the accounting in this regard:

(a)                    IPSAS 9 Revenue from Exchange Transactions;

(b)                   IPSAS 11 Construction Contracts;

(c)                    IPSAS 23 Revenue from Non-exchange Transactions (Taxes and Transfers).

BC178        The Board observed IPSAS 9 and IPSAS 11 are based on the principles of superseded IAS 18 Revenue (incorporated into AASB 118 Revenue) and IAS 11 Construction Contracts (incorporated into AASB 111 Construction Contracts), rather than