Document ID: chunk:federal_register_of_legislation:F2024L01472:body:0:p66
Version: federal_register_of_legislation:F2024L01472
Segment Type: other
Provision Reference: 
Character Range: 188642–191868

AASB intends to finalise mandatory requirements for industry-based disclosures by 2030.

Users of a not-for-profit entity's GPFR
 1.             Under the Corporations Act amendments, some not-for-profit entities will be required to disclose climate-related financial information. To support those requirements, as noted in the AASB Sustainability Reporting Standard-Setting Framework, the AASB has determined that it will, as far as is practicable, focus on developing sector-neutral Australian Sustainability Reporting Standards. That is, it is the AASB's intention to develop transaction-neutral sustainability reporting Standards where possible. A transaction (or sector) neutrality approach to sustainability reporting Standards means that like transactions, other events and conditions are considered in a like manner for all types of entities, whatever their sector of activity, unless there is a justifiable reason not to do so. Accordingly, the AASB considered whether any modifications to the IFRS S2 baseline requirements might be needed for not-for-profit entities.
 2.             The AASB decided to add paragraph AusA1 in Appendix A Defined terms to require a not-for-profit entity to refer to the meaning of "general purpose financial reports" and "primary users of general purpose financial reports" specified in the Framework for the Preparation and Presentation of Financial Statements when applying AASB S2. The AASB also added guidance in paragraphs AusB14.1 and AusB15.1 in Appendix D General Requirements for Disclosure of Climate-related Financial Information to AASB S2.
 3.             The AASB added those paragraphs because:
          1.                     IFRS S2 defines "primary users of general purpose financial reports" as existing and potential investors, lenders and other creditors, whereas users of a not-for-profit entity's GPFR described in the Framework for the Preparation and Presentation of Financial Statements also include parliaments, taxpayers, donors and recipients of goods and services; and
          2.                    the definition of "general purpose financial reports" in IFRS S2 states that users' decision-making involves decisions about (1) buying, selling or holding equity and debt instruments; (2)               providing or selling loans and other forms of credit; or (3) exercising rights to vote on, or otherwise influence, the entity's management's actions that affect the use of the entity's economic resources. In respect to not-for-profit entities, paragraph AusOB3.1 of the Framework for the Preparation and Presentation of Financial Statements states that "users (such as certain existing and potential resource providers) are generally not concerned with obtaining a financial return on an investment in the entity. Rather, they are concerned with the ability of the entity to achieve its objectives (whether financial or nonfinancial), which in turn may depend, at least in part, on the entity's prospects for future net cash inflows. Users will, for example, be interested in the capability of the entity's resources to provide goods and services in the future."
 1.             Additionally, paragraph AusOB2.1 of the Framework for the Preparation