Document ID: chunk:federal_register_of_legislation:F2024L00075:reg:38:p28
Version: federal_register_of_legislation:F2024L00075
Segment Type: reg
Provision Reference: reg 38 (pt 28/76)
Character Range: 110956–114119

with the exception of tax assets, and any assets arising from insurance arrangements the entity provides to its members.
BC49            Most of the respondents that specifically commented on the ED 179 and ED 223 asset measurement proposals expressed general agreement with them.  One respondent expressed concern that assets be measured at 'bid' prices and liabilities be measured at 'ask' prices.  However, the AASB noted that entities reporting under AAS 25 should, in principle, measure their assets at bid prices and liabilities other than member liabilities at ask prices because AAS 25 is based on an exit value model.  The AASB also noted that, while some superannuation entities may be currently measuring assets at their 'mid' prices, this is presumably because any differences between the assets' bid and mid prices are not material.
BC50            In the interests of providing useful information on investment performance and in light of respondents' comments, the AASB concluded the replacement Standard for AAS 25 should require fair value through profit or loss measurement for most assets.
BC51            In coming to this conclusion, the AASB noted:
(a)                   a superannuation entity would apply AASB 13, which takes a principles-based approach to determining fair value measurement; and
(b)                   any implementation issues a superannuation entity might encounter in applying AASB 13 are unlikely to be unique and would potentially arise in the context of other investment-type entities, such as managed investment schemes.
Accordingly, the AASB concluded it is not necessary to include additional fair value measurement guidance in the replacement Standard for AAS 25.

Transaction costs
BC52            Under AAS 25, a superannuation plan is required to measure its assets net of anticipated disposal costs.  In developing ED 179, the AASB considered a number of different treatments for transaction costs, including:
(a)                   separate recognition as an expense when incurred; and
(b)                   as a reduction of the carrying amounts of assets.
BC53            The AASB concluded ED 179 should propose transaction costs be treated as a reduction in the carrying amounts of assets because:
(a)                   members and beneficiaries would regard information about assets net of transaction costs as useful as it might have a direct bearing on assessing a superannuation entity's capacity to pay benefits;
(b)                   it would facilitate alignment between financial reporting requirements and member reporting practices; and
(c)                   it is consistent with the treatment of assets under some Australian Accounting Standards, such as AASB 5 Non-current Assets Held for Sale and Discontinued Operations in respect of assets held for immediate sale.
BC54            Several respondents to ED 179 expressed disagreement with the proposal to adjust fair value amounts for transaction costs because:
(a)                   the treatment is inconsistent with the approach required under most Australian Accounting Standards, including AASB 139 Financial Instruments: Recognition