Explanatory Statement

Accounting Standard AASB 2009-12 Amendments to Australian Accounting Standards

December 2009

EXPLANATORY STATEMENT

Standards Amended by AASB 2009-12

This Standard makes amendments to the following Australian Accounting Standards and Interpretations:

1. AASB 5 Non-current Assets Held for Sale and Discontinued Operations;
2. AASB 8 Operating Segments;
3. AASB 108 Accounting Policies, Changes in Accounting Estimates and Errors;
4. AASB 110 Events after the Reporting Period;
5. AASB 112 Income Taxes;
6. AASB 119 Employee Benefits;
7. AASB 133 Earnings per Share;
8. AASB 137 Provisions, Contingent Liabilities and Contingent Assets;
9. AASB 139 Financial Instruments: Recognition and Measurement;
10. AASB 1023 General Insurance Contracts;
11. AASB 1031 Materiality;
12. Interpretation 2 Members’ Shares in Co-operative Entities and Similar Instruments;
13. Interpretation 4 Determining whether an Arrangement contains a Lease;
14. Interpretation 16 Hedges of a Net Investment in a Foreign Operation;
15. Interpretation 1039 Substantive Enactment of Major Tax Bills in Australia; and
16. Interpretation 1052 Tax Consolidation Accounting.

AASB 8 Operating Segments is amended as a result of the issuance of IAS 24 Related Party Disclosures by the International Accounting Standards Board (IASB) in November 2009. 

All the other amendments principally arise from editorial corrections made by the IASB to its Standards and Interpretations (IFRSs) and by the AASB to its pronouncements.

Main Features of this Standard

Application Date

This Standard is applicable to annual reporting periods beginning on or after 1 January 2011.  Early adoption is permitted for annual reporting periods beginning on or after I January 2005 but before 1 January 2011.

In respect of AASB 8, this Standard amends paragraph 34 of AASB 8 for annual reporting periods beginning on or after 1 January 2011.  If an entity applies the revised AASB 124 Related Party Disclosures for an earlier period, it shall apply the amendment to paragraph 34 of AASB 8 for that earlier period.

Main Requirements

The amendment to AASB 8 requires an entity to exercise judgement in assessing whether a government and entities known to be under the control of that government are considered a single customer for the purposes of certain operating segment disclosures.

This Standard also makes numerous editorial amendments to a range of Australian Accounting Standards and Interpretations, including amendments to reflect changes made to the text of IFRSs by the IASB.

These amendments have no major impact on the requirements of the amended pronouncements.

Consultation Prior to Issuing AASB 2009-12

The amendment to AASB 8 is the only substantive aspect of AASB 2009-12 and is a consequential amendment arising from the issuance of revised AASB 124 (December 2009). The AASB issued Exposure Draft ED 170 Relationships with the State in December 2008.  ED 170 reproduced the proposals included in the IASB’s Exposure Draft Relationships with the State (December 2008) without amendment.  The AASB received four submissions from Australian constituents on ED 170.  Submissions received were generally supportive.

A Regulation Impact Statement has not been prepared in connection with the issue of AASB 2009-12 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.