Document ID: chunk:federal_register_of_legislation:F2023C00381:reg:25:p6
Version: federal_register_of_legislation:F2023C00381
Segment Type: reg
Provision Reference: reg 25 (pt 6/47)
Character Range: 34377–37478

the private and public sectors and for-profit public sector entities, as part of Phase 2.

Issue of ITC 39 Applying the IASB's Revised Conceptual Framework and Solving the Reporting Entity and Special Purpose Financial Statement Problems

     BC10            The Board's proposals were exposed for public comment in May 2018 as part of Invitation to Comment ITC 39 Consultation Paper – Applying the IASB's Revised Conceptual Framework and Solving the Reporting Entity and Special Purpose Financial Statement Problems.  In developing the proposals in ITC 39, the Board considered the findings of various research projects it had initiated.  This included AASB Research Report No. 1 Application of the Reporting Entity Concept and Lodgement of Special Purpose Financial Statements (June 2014) and AASB Research Report No. 6 Financial Reporting Requirements Applicable to Public Sector Entities (May 2018).

     BC11            ITC 39 considered five alternatives for implementing the revised Conceptual Framework in Australia:
(a) Option 1 – Adopt a two-phased approach to applying the revised Conceptual Framework.  This option would implement the revised Conceptual Framework for for-profit publicly accountable entities and other entities voluntarily claiming compliance with IFRS Standards in Phase 1.  It would then implement the revised Conceptual Framework for all other entities in Phase 2.  Phase 2 would remove the Australian reporting entity concept and remove the ability of an entity to prepare special purpose financial statements as a non-reporting entity where they are required to comply with Australian Accounting Standards.
(b) Option 2 – Operate with two conceptual frameworks.  This option would implement the revised Conceptual Framework for publicly accountable for-profit entities and other entities voluntarily reporting compliance with IFRS Standards.  It would also retain the Framework for the Preparation and Presentation of Financial Statements (the existing Conceptual Framework) for all other entities.
(c) Option 3 – Implement the revised Conceptual Framework for all entities when it first becomes applicable to maintain compliance with IFRS Standards and IFRS Standards as a base for Australian Accounting Standards.  This option would remove the Australian reporting entity concept and the ability of an entity to prepare special purpose financial statements as a non-reporting entity where they are required to comply with Australian Accounting Standards from 1 January 2020.
(d) Option 4 – Retain the existing Conceptual Framework, the Australian reporting entity concept and the ability of an entity to prepare special purpose financial statements as a non-reporting entity where they are required to comply with Australian Accounting Standards.  Under this option, compliance with Australian Accounting Standards might not result in compliance with IFRS Standards after 1 January 2020.
(e) Option 5 – Implement the revised Conceptual Framework from 1 January 2020 when it first becomes applicable to maintain compliance with IFRS Standards and IFRS Standards as