Document ID: chunk:federal_register_of_legislation:F2023C00381:reg:8:p23
Version: federal_register_of_legislation:F2023C00381
Segment Type: reg
Provision Reference: reg 8 (pt 23/28)
Character Range: 241261–244639

Board decided that the need to remove SPFS for the entities within the scope of this Standard in a timely manner would mean that waiting for the IASB and retaining trans-Tasman convergence (in the short term) would not meet the objective of the project (see the Basis for Conclusions to AASB 1060 for the Board's considerations on these matters).

Application of The AASB's For-Profit Entity Standard-Setting Framework

     BC154        In developing the Standard the Board considered the principles in The AASB's For-Profit Entity Standard-Setting Framework, which outlines the matters the Board must consider when determining whether or not to make amendments to IFRS Standards or develop Australian-specific guidance.

     BC155        The AASB's For-Profit Entity Standard-Setting Framework states that, when developing accounting standards for non-publicly accountable for-profit entities, the AASB's objective is to use IFRS Standards and transaction neutrality as a starting point, with modifications where justified to address:

          (a)                    Australian-specific legislation, user needs, or public interest issues relevant to financial reporting or beyond financial reporting;

          (b)                   issues specific to the (for-profit) public sector of such prevalence and magnitude that users are likely to make inappropriate decisions based on the financial statements;

          (c)                    where the objectives and qualitative characteristics of financial reporting as set out in the existing Conceptual Framework would not be met; and/or

          (d)                   undue cost or effort considerations.

     BC156        Consistent with this, the Board decided standard-setting activities as reflected in this Standard were necessary after undertaking the following (as already noted throughout this Standard):

          (a)                    extensive public consultation and outreach including ITC 39 and ED 297, research into the needs of financial statement users (eg public surveys and targeted outreach), feedback obtained from stakeholders (including users) who participated in roundtable events, along with other general and targeted outreach with stakeholders;

          (b)                   engaging with Treasury and assessing the impact of regulatory changes to large proprietary companies, including understanding the number of entities expected to be affected by the increase in the large proprietary company thresholds from this Standard;

          (c)                    the preparation and review of various research reports, including Research Report No. 1, AASB Research Report No. 4 Review of Adoption of International Financial Reporting Standards in Australia (March 2017), AASB Research Report No. 7 and Research Report 12 to understand the current application of the reporting entity concept, as well as to understand the degree of non-compliance with the R&M requirements in AAS. The objective of these research activities was to better understand the cost implications of disallowing entities required to prepare financial statements that comply with AAS to prepare SPFS and require them to prepare GPFS instead;

          (d)                   considering whether it was necessary to provide transitional relief in addition to that currently available under AASB 1 and AASB 108 with