Explanatory Statement

Accounting Standard AASB 2011-12
Amendments to Australian Accounting Standards arising from Interpretation 20

[AASB 1]

November 2011

EXPLANATORY STATEMENT

Reasons for Issuing AASB 2011-12

The International Accounting Standards Board has issued IFRIC Interpretation 20 Stripping Costs in the Production Phase of a Surface Mine (IFRIC 20), which includes an Appendix B that sets out amendments to an IFRS that are a consequence of the issuance of IFRIC 20.  Appendix B of IFRIC 20 has been incorporated into AASB 2011-12 Amendments to Australian Accounting Standards arising from Interpretation 20.  The AASB needs to issue AASB 2011-12 (together with AASB Interpretation 20 Stripping Costs in the Production Phase of a Surface Mine) to enable relevant Australian reporting entities to continue to be compliant with International Financial Reporting Standards.

Main Features of AASB 2011-12

AASB 2011-12 makes amendments to Australian Accounting Standard AASB 1 First-time Adoption of Australian Accounting Standards, to reflect the issuance of AASB Interpretation 20 in November 2011.

Application Date

AASB 2011-12 (and AASB Interpretation 20) is applicable to annual reporting periods beginning on or after 1 January 2013.  If AASB Interpretation 20 is early applied, AASB 2011-12 shall be applied for that earlier period. 

Consultation Prior to Issuing this Standard

The AASB made Draft IFRIC Interpretation DI/2010/1 Stripping Costs in the Production Phase of a Surface Mine publicly available on its website in August 2010.  During the period September to November 2010 the AASB consulted with some Australian constituents on the content of the draft.  Those constituents generally did not support the issuance of an Interpretation because they did not consider there to be a significant divergence in practice.  This view was conveyed to the IASB by the AASB.

A Regulation Impact Statement has not been prepared in connection with the issuance of AASB 2011-12 as the amendments are minor in nature and relate to an interpretation of accounting principles.