Document ID: chunk:federal_register_of_legislation:F2025C00209:reg:221:p36
Version: federal_register_of_legislation:F2025C00209
Segment Type: reg
Provision Reference: reg 221 (pt 36/73)
Character Range: 262052–265170

increases the association between dividends and future earnings and therefore provides useful information about an entity's future earnings potential and short-term cash flows.[58] Requiring the disclosure will ensure that information about the entity's imputation credits will not be lost when entities transition from SPFS to this Standard.

Specific transition disclosure requirements in another Standard

      1.             The Board noted that other Australian Accounting Standards may provide transition options for entities on initial application and that these options may be accompanied by specific transition disclosure requirements. Examples of such transition options can be found in AASB 15, AASB 16, AASB 1058 Income of Not-for-Profit Entities or AASB 1059 Service Concession Arrangements: Grantors. The Board decided that where this is the case, the entity shall apply the relevant specific transition disclosures that are required under that Standard for the selected transition option instead of the disclosures for a change in accounting policy specified in paragraph 106 of this Standard.

      2.             This is because even though the specific transition option under another Standard may require additional disclosures compared to what would be required under paragraph 106, the Board noted that the targeted disclosures of the selected transition option provide more relevant information about the transitional impact than the general accounting policy change disclosures required under paragraph 106.

      3.             For example, where an entity adopts AASB 16 using the simplified transition approach and does not restate comparative information, AASB 16 paragraph C12 requires disclosure of an explanation of the differences between operating lease commitments disclosed under AASB 117 Leases at the end of the previous annual reporting period to the lease liabilities recognised in the statement of financial position at the date of initial application under AASB 16, together with the weighted average lessee's incremental borrowing rate applied to the lease liabilities recognised at the date of initial application. In addition, the entity must also disclose whether it has used any of the specified practical expedients when adopting AASB 16. This provides more relevant information than a disclosure of the adjustments recognised for each financial statement line item affected by the new accounting policy in paragraph 106(b) for the current and each prior period presented.

AASB Standards and Interpretations not covered in AASB 1060

      1.             There are a number of Standards that the Board decided not to address in this Standard for the following reasons:

           1.                     AASB 14 Regulatory Deferral Accounts as it would only be relevant for entities that have recognised regulatory deferral account balances under their current accounting policy (eg where the entity prepared SPFS without complying with the R&M of full AAS). None of the respondents to ED 295 identified any entities that intend to apply AASB 14 on transition to GPFS.