Document ID: chunk:federal_register_of_legislation:F2022C01110:reg:20:p8
Version: federal_register_of_legislation:F2022C01110
Segment Type: reg
Provision Reference: reg 20 (pt 8/40)
Character Range: 59186–62266

may not be publicly accountable.  Accordingly, the Board did not deem all regulated insurance entities as publicly accountable.
BC29            Some respondents to ED 192 also questioned whether Small Australian Prudential Regulation Authority (APRA) Funds (SAFs) should be deemed to be publicly accountable, given the small number of members and the limited users of their financial statements.
BC30            The Board noted that SAFs are usually similar in size to self-managed super funds (SMSFs) but, unlike SMSFs (which are regulated by the Australian Taxation Office [ATO]), are regulated by APRA because they do not meet all conditions to be a SMSF.  The Board noted there may be users (such as regulators and trustees) of the financial statements of SAFs who can command information they need and the outsiders for whom the SAF holds assets in a fiduciary capacity.  Accordingly, those users do not seem to constitute a broad group and the Board decided not to deem SAFs as publicly accountable.
BC31            Furthermore, some respondents questioned whether all entities holding an Australian Financial Services Licence (AFSL) would meet the definition of publicly accountable.
BC32            The Board noted that AFSL holders undertake a range of activities and are a diverse group of entities.  The Board concluded that whether an AFSL holder is publicly accountable depends on the circumstances, including the nature of the services they provide.  Therefore, it would not be appropriate for the Board to deem AFSL holders as publicly accountable or not publicly accountable.

Size Thresholds
BC33            The Board proposed in ITC 12 that for-profit entities that do not satisfy the definition of a publicly accountable entity, nevertheless may be viewed as being 'important' from a public interest perspective because of their large size, and should be subject to Tier 1 requirements.  The size thresholds proposed were:
           * Consolidated revenue for the financial year of the entity and the entities it controls (if any) of $500m.
           * Consolidated assets at financial year end of the entity and the entities it controls (if any) of $250m.
BC34            The Board considered constituents' comments on the issue and decided not to require entities that are 'important' because of their large size to adopt Tier 1 requirements on the grounds that:
(a)                    size thresholds are arbitrary;
(b)                   using public accountability (as defined by the IASB) for the for-profit sector in Australia would be consistent with international requirements;
(c)                    large non-publicly accountable entities would still be required to prepare high-quality general purpose financial statements under the requirements of Tier 2; and
(d)                   keeping size thresholds that identify 'important' entities up-to-date would entail additional maintenance and monitoring costs.

For-Profit Entities in the Public Sector
BC35            The Board noted that the definition of public accountability it has adopted has