Document ID: chunk:federal_register_of_legislation:F2022C00487:reg:36:p11
Version: federal_register_of_legislation:F2022C00487
Segment Type: reg
Provision Reference: reg 36 (pt 11/12)
Character Range: 52488–55397

adopters of IFRS that do not elect to apply the proposals.
BC6               In January 2014, the IASB issued IFRS 14 Regulatory Deferral Accounts (incorporating the proposals in ED/2013/5 without substantive changes) for annual reporting periods beginning on or after 1 January 2016, with early application permitted. The AASB noted that its concerns with the ED/2013/5 proposals, expressed in its submission to the IASB, were not addressed in IFRS 14.
BC7               After further considering the types of entities that might be affected by the requirements of AASB 14 (including a newly listed rate-regulated entity from a foreign jurisdiction and a foreign rate-regulated entity that 'back door' lists in Australia), the AASB expects that the practical impact of adopting AASB 14 in Australia would be minimal.
BC8               The AASB noted that its concerns (see paragraph BC5 above) are not so great as to cause it to make a decision that would be seen as not adopting IFRS more broadly. Accordingly, given the interim nature of IFRS 14 (and therefore AASB 14) and the expected practical impact of AASB 14, consistent with its policy of adopting IFRS in Australia, the AASB decided to issue AASB 14 on the basis that to do so would not be contrary to the best interests of the Australian economy.
BC9               The AASB also noted that, currently under AASB 1 First-time Adoption of Australian Accounting Standards, if a first-time adopter recognises property, plant and equipment or intangible assets used in rate-regulated activities and the carrying amounts of such items include amounts determined under the entity's previous GAAP that do not qualify for capitalisation in accordance with Australian Accounting Standards, the first-time adopter may elect to use its previous GAAP carrying amount of such items at the date of transition to Australian Accounting Standards as deemed cost (paragraph D8B of AASB 1). A similar exemption is also available to a first-time adopter with oil and gas properties, whereby the entity may elect to account for its exploration and evaluation assets at the amount determined under the entity's previous GAAP on transition to Australian Accounting Standards (paragraph D8A of AASB 1). The AASB considered that the exemption in AASB 14 that would permit first-time adopters to continue to account for amounts related to rate regulation in accordance with their previous GAAP when they first-time adopt Australian Accounting Standards is somewhat similar to these exemptions in AASB 1. Therefore, AASB 14 would be broadly consistent with the approach taken by the AASB to allowing first-time adopters to 'grandfather' previous GAAP when transitioning to Australian Accounting Standards.

Dissenting opinion

Dissent of Peter Gibson and Steve Mitsas
DO1 AASB 14 Regulatory Deferral Accounts is consistent with the AASB's policy of incorporating IFRSs into