Document ID: chunk:federal_register_of_legislation:F2022C01110:reg:20:p3
Version: federal_register_of_legislation:F2022C01110
Segment Type: reg
Provision Reference: reg 20 (pt 3/40)
Character Range: 45031–48428

'relief' for these entities is not having to apply the disclosure requirements contained in Standards other than AASB 101, AASB 107 and AASB 108.
BC8               In addition to AASB pronouncements that incorporate IFRSs, there are Australian Accounting Standards (including Interpretations) that apply specifically to some or all NFP entities, including:
(a)                    AASB 1004 Contributions;
(b)                   AASB 1049 Whole of Government and General Government Sector Financial Reporting;
(c)                    AASB 1050 Administered Items;
(d)                   AASB 1051 Land Under Roads;
(e)                    AASB 1052 Disaggregated Disclosures; and
(f)                    AASB Interpretation 1038 Contributions by Owners Made to Wholly-owned Public Sector Entities.
BC9               Prior to AASB 1053, entities not incorporated under the Corporations Act, (which include many NFP entities and most public sector entities), were required to apply, where applicable, the recognition, measurement, presentation and disclosure requirements of these and other Australian Accounting Standards if they were reporting entities or holding out financial statements to be general purpose financial statements.

The Need to Review the Differential Reporting Framework
BC10            The Board identified a number of concerns with the differential reporting framework that existed prior to AASB 1053.  These concerns included that:
(a)                    costs of preparing general purpose financial statements for some entities were greater than benefits for the users of those general purpose financial statements, because the framework resulted in requirements for general purpose financial statements that were overly burdensome for many entities; and
(b)                   user needs were not being satisfied for other entities, because the framework was being applied in a way that some entities (which should prepare general purpose financial statements) were being treated as non-reporting entities and preparing only special purpose financial statements.
BC11            When it was initially considering these concerns, the Board noted that the International Accounting Standards Board (IASB) was developing an IFRS for SMEs that would result in general purpose financial statements that would not be compliant with IFRSs.  Accordingly, the Board decided that, in revising its differential reporting framework, it was appropriate for the Board to also consider requirements for general purpose financial statements that differ from (full) Australian Accounting Standards.  The Financial Reporting Council has been kept apprised of these developments.
BC12            The Board issued a number of consultative documents containing its proposals for addressing the concerns noted in paragraph BC10.  These documents were, in sequence:
(a)                    Invitation to Comment ITC 12 Request for Comment on a Proposed Revised Differential Reporting Regime for Australia and IASB Exposure Draft of A Proposed IFRS for Small and Medium-sized Entities – issued in May 2007;
(b)                   Consultation Paper Differential Financial Reporting – Reducing Disclosure Requirements (A Proposed Reduced Disclosure Regime for Non-publicly Accountable For-profit Private Sector Entities and Certain Entities in the Not-for-profit Private Sector and Public Sector) – issued in