Explanatory Statement
Accounting Standard AASB 2009-5 Further Amendments to Australian Accounting Standards arising from the Annual Improvements Project
May 2009
EXPLANATORY STATEMENT
Standards Amended by AASB 2009-5
This Standard makes amendments to the following Australian Accounting Standards:
AASB 5 Non-current Assets Held for Sale and Discontinued Operations;
AASB 8 Operating Segments;
AASB 101 Presentation of Financial Statements;
AASB 107 Statement of Cash Flows;
AASB 117 Leases;
AASB 118 Revenue;
AASB 136 Impairment of Assets; and
AASB 139 Financial Instruments: Recognition and
Measurement;
as a consequence of the annual improvements project.
The amendments result from proposals that were included in Exposure Draft ED 165 Proposed Improvements to Australian Accounting Standards issued in August 2008 and proposals included in ED 159 Proposed Improvements to Australian Accounting Standards issued in October 2007and follow the issuance of the IASB Standard Improvements to IFRSs in April 2009. The IASB’s annual improvements project provides a vehicle for making non-urgent but necessary amendments to Standards.
Main Features of this Standard
Application Date
This Standard is applicable to annual reporting periods beginning on or after 1 January 2010, with early adoption permitted for annual reporting periods beginning on or after 1 January 2005 but before 1 January 2010.
The insertion of early adoption conditions in the individual Standards means that the amendments to each of those Standards can be applied separately from the amendments to the other Standards, provided the early adoption conditions in the particular Standard are satisfied.
Main Requirements
The amendments to some Standards result in accounting changes for presentation, recognition or measurement purposes, while some amendments that relate to terminology and editorial changes are expected to have no or minimal effect on accounting. The subjects of the principal amendments to the Standards are set out below:
Australian Accounting Standard | Subject of amendment |
AASB 5 Non-current Assets Held for Sale and Discontinued Operations | Disclosure of non-current assets (or disposal groups) classified as held for sale or discontinued operations |
AASB 8 Operating Segments | Disclosure of information about segment assets |
AASB 101 Presentation of Financial Statements | Current/non-current classification of convertible instruments |
AASB 107 Statement of Cash Flows | Classification of expenditures on unrecognised assets |
AASB 117 Leases | Classification of leases of land and buildings |
AASB 118 Revenue | Determining whether an entity is acting as a principal or as an agent |
AASB 136 Impairment of Assets | Unit of accounting for goodwill impairment test |
AASB 139 Financial Instruments: Recognition and Measurement | Treating loan prepayment penalties as closely related embedded derivatives |
Scope of exemption for business combination contracts | |
Cash flow hedge accounting |
Consultation Prior to Issuing AASB 2009-4
The AASB issued AASB 2009-4 after a due process, which included the issue of ED 165 Proposed Improvements to Australian Accounting Standards in August 2008 and ED 159 Proposed Improvements to Australian Accounting Standards issued in October 2007. The AASB received three submissions on ED 165 and nine submissions on ED 159. In general, those submissions were supportive of ED 165 and ED 159.
A Regulation Impact Statement has not been prepared in connection with the issue of AASB 2009-5 as the amendments do not have a substantial direct or indirect impact on business or competition.