Document ID: chunk:federal_register_of_legislation:F2023C00381:reg:25:p37
Version: federal_register_of_legislation:F2023C00381
Segment Type: reg
Provision Reference: reg 25 (pt 37/47)
Character Range: 126616–129634

not result in compliance with IFRS Standards after 1 January 2020.

          (d)                   Option 5 – Implement the RCF from 1 January 2020 when it first becomes applicable to maintain compliance with IFRS Standards and keep IFRS Standards as a base for AAS. Under Option 5, the Australian reporting entity concept would be retained but the name amended and minimum requirements for SPFS would be prescribed by the Board. The Board decided not to proceed with Option 5 as it did not consider this option to be significantly different from Option 1 (except for the phased approach) or Option 3, as the AASB would still need to prescribe minimum reporting requirements for SPFS preparers to resolve the SPFS problem.

AASB's deliberations on proceeding with Phase 2

     BC58            The Board received 33 formal comment letters (relevant to this phase of the project) in response to ITC 39, from professional service firms, regulators, professional bodies, academics, preparers, users of financial statements and other respondents on specific and general matters for comment regarding Phase 2. The Board considered the comments received from each respondent and engaged directly with respondents to discuss any comments which required clarification. The Board also received feedback on the phase 2 proposals (targeted only to for-profit private sector entities) when they were presented at various forums, workshops and discussion groups to obtain feedback. This included roundtable sessions held in September 2018, where 106 stakeholders including regulators, professional bodies, users, preparers, auditors and academics attended. Furthermore, feedback was sought via targeted user and preparer surveys in quarter 3 of 2018, which received a total of 37 user and 49 preparer responses. The surveys were focussed on the specific matters for comment in ITC 39, and were used to get a better understanding of which of the Tier 2 GPFS frameworks proposed in ITC 39 users preferred (and why), as well as what transitional relief would be helpful to preparers. The feedback received from the formal comment letters, roundtables and surveys was consistent, indicating that

          (a)                    there is a SPFS problem that needs to be solved;

          (b)                   the Tier 2 GPFS framework should require compliance with all the R&M requirements in AAS including consolidation and equity accounting (where applicable);

          (c)                    comparability, transparency, comprehensibility and consistency are what users need most in financial statements;

          (d)                   a revised Tier 2 GPFS disclosure framework was preferred as SDR seemed to be missing some key disclosures, while RDR had too many. The Board noted the low number of entities moving from SPFS indicated that the costs of RDR were seen to outweigh the benefits for these entities. However, in comparison to Tier 1 GPFS there was some benefit as 13% had voluntarily moved to RDR. Respondents