Explanatory Statement

Accounting Standard AASB 2008-13 Amendments to Australian Accounting Standards arising from AASB Interpretation 17 – Distributions of
Non-cash Assets to Owners

December 2008

EXPLANATORY STATEMENT

Standards Amended by AASB 2008-13

This Standard makes amendments to the following Australian Accounting Standards:

1. AASB 5 Non-current Assets Held for Sale and Discontinued Operations; and
2. AASB 110 Events after the Balance Sheet Date.

These amendments arise from the issuance of AASB Interpretation 17 Distributions of Non-cash Assets to Owners.

Main Features of this Standard

Application Date

This Standard is applicable prospectively to annual reporting periods beginning on or after 1 July 2009.  Retrospective application is not permitted.  This Standard shall be applied when AASB Interpretation 17 is applied.  Earlier application is permitted.  If an entity applies this Standard for a period beginning before 1 July 2009, it shall disclose that fact and also apply AASB 3 Business Combinations (March 2008, as amended), AASB 127 Consolidated and Separate Financial Statements (as amended in May 2008) and AASB Interpretation 17 for the same period.

Main Requirements

The issuance of AASB Interpretation 17 necessitates consequential amendments to AASB 5 and AASB 110.  The amendments are in respect of the classification, presentation and measurement of non-current assets held for distribution to owners in their capacity as owners and the disclosure requirements for dividends that are declared after the reporting period but before the financial statements are authorised for issue, respectively.

Consultation Prior to Issuing AASB 2008-13

The AASB issued AASB Interpretation 17 Distributions of Non-cash Assets to Owners in December 2008, which is equivalent to IFRIC Interpretation 17 Distributions of Non-cash Assets to Owners. 

Prior to issuing AASB 2008-13, the AASB invited comments from Australian constituents on the proposals regarding distributions of non-cash assets to owners and the consequential amendments to other Australian Accounting Standards resulting from IFRIC’s Draft Interpretation D23 Distributions of Non-cash Assets to Owners.  The AASB received four submissions from Australian constituents.  Submissions received were generally supportive, however, some of the conclusions arrived at in D23 were questioned by constituents.  The AASB included comments in its submission to the IASB that stronger rationales were considered necessary to support the conclusions reached by the IASB.

A Regulation Impact Statement has not been prepared in connection with the issue of AASB 2008-13 as the amendments made do not have a substantial direct or indirect impact on business or competition, are of a minor or machinery nature or clarify existing requirements.