Financial Sector (Collection of Data) (reporting standard) determination No. 10 of 2007 - MRS 140.4 - Investments - Assets Indirectly Held

Administered by Department of the Treasury

Legislation au F2007L02100 Not in force Legislative Instrument

Legislation content

Financial Sector (Collection of Data) (reporting standard) determinations Nos. 1- 17 of 2007

 

 

EXPLANATORY STATEMENT

 

Prepared by the Australian Prudential Regulation Authority (APRA)

Issued by the authority of APRA

 

Financial Sector (Collection of Data) Act 2001 (the Act), paragraph 13(1)(a)

 

Acts Interpretation Act 1901, subsection 33(3)

 

 

Under paragraph 13(1)(a) of the Act, APRA may, by writing, determine reporting standards with which financial sector entities must comply.  Such standards relate to reporting financial or accounting data and other information regarding the business or activities of the entities.  Subsection 33(3) of the Acts Interpretation Act 1901 provides that where an Act confers a power to issue an instrument the power shall, unless the contrary intention appears, be construed as including a power exercisable in the like manner and subject to the like conditions (if any) to amend or vary any such instrument.

 

Financial Sector (Collection of Data) (reporting standard) determinations Nos. 1 - 17 of 2007 (the instruments) respectively revoke and replace the reporting standards (which were originally determined on 29 June 2004 to have effect from 30 June 2004) outlined below in respect of corporations to which section 5A of the Act applies (MDOs):

 

MRS 120.0: Capital Base

MRS 130.0: Off Balance Sheet Business – Direct Credit Substitutes Provided

MRS 130.1: Off Balance Sheet Business – Liquidity Support Facilities Obtained

MRS 130.2: Off Balance Sheet Business – Charges Granted

MRS 130.3: Off Balance Sheet Business – Credit Support Received

MRS 140.0: Investments – Direct Interest Rate Holdings

MRS 140.1: Investments – Direct Equity Holdings

MRS 140.2: Investments – Direct Property Holdings

MRS 140.3: Investments – Loans and Advances

MRS 140.4: Investments – Assets Indirectly Held

MRS 150.0: Asset Exposures

MRS 160.0: Derivative Activity

MRS 210.0: Outstanding Claims Liabilities

MRS 300.0: Statement of Financial Position

MRS 310.0: Statement of Financial Performance

MRS 310.2: Claims Expense and Reinsurance Recoveries

MRS 310.3: Investment and Operating Income and Expenses

 

Under subsection 15(2) of the Act, APRA has declared that the reporting standards shall begin to apply to all MDOs on the later of 30 June 2007 and the date of registration of the instruments on the Federal Register of Legislative Instruments.

 

  1.    Background

 

This Explanatory Statement explains the changes being made by APRA to the reporting framework for MDOs in response to Australian equivalents to international financial reporting standards (AIFRS).

 

Each reporting standard comprises: (1) the body of the reporting standard itself (which contains details about inter alia when returns under the standards must be lodged with APRA); (2) one or more reporting forms which must be completed by MDOs covered by the reporting standard; and (3) a set of detailed technical instructions regarding completion of the form.

 

The changes to Australian accounting standards that flow from the adoption of AIFRS, if left unadjusted, would automatically flow through to APRA’s reporting framework. APRA’s objective in its approach to AIFRS is to align its reporting  standards with Australian accounting standards and principles to the extent practicable, as the latter provide a widely accepted basis for the recognition and measurement of assets, liabilities, equity, revenue and expenses

 

 

2.      Purpose of the instrument

The purpose of each instrument is to revoke those reporting standards applying to MDOs and to replace them with corresponding standards which incorporate appropriate adjustments (new standards).  APRA considered that it would be clearer and more effective to consolidate the necessary changes within new standards.  For that reason, APRA decided to revoke and replace reporting standards rather than to amend them. APRA has also taken this opportunity to update the formatting of instructions attaching to all MDO reporting standards. Therefore APRA has revoked all MDO reporting standards and redetermined them.

 

3.      Operation of the instruments

 

The instruments determine the new standards.

 

The forms and instructions have been revised taking account of the impact of AIFRS. The core changes are as follows and most are due to AIFRS:

 

  • Terminology changes – Use of AIFRS and prudential terminology (e.g. Market value replaced with Fair value, Provision for deferred tax replaced with Deferred tax liability, Unrealised gain on derivatives replaced with Derivative financial instruments);
  • Addition - eg Paid up ordinary shares and Other liabilities; and
  • Deleted – eg Goodwill amortisation.

 

In addition, there have also been changes to update the formatting and references of the instruction guides together with improvement of wording. These changes do not affect the content of the reporting standards or instruction guides.

 

4.      Consultation

 

Consultation with all 7 MDOs has been held over a 2 week period.

 

5.      Regulation Impact Statement

 

A RIS or BCC report is not mandatory as the proposal has a low impact on business and individuals (including compliance costs).

Overview

The Financial Sector (Collection of Data) (reporting standard) determinations Nos. 1-17 of 2007 were introduced to address the need for the Australian Prudential Regulation Authority (APRA) to update and align the reporting standards for Managed Investment Schemes (MDOs) with Australian equivalents to International Financial Reporting Standards (AIFRS). Enacted under the Financial Sector (Collection of Data) Act 2001, these determinations empower APRA to set reporting standards for financial entities, which include financial and accounting data related to their business activities. The policy objective of these instruments is to ensure that APRA's reporting standards remain consistent with Australian accounting standards and principles, facilitating a widely accepted basis for the recognition and measurement of financial elements such as assets, liabilities, equity, revenue, and expenses. APRA chose to revoke and replace the existing reporting standards with new ones to provide clarity and effectiveness, incorporating necessary adjustments and updating the formatting of the accompanying instructions. This initiative aimed to streamline the reporting process while maintaining compliance with the latest financial reporting standards.

Scope and Application

The Financial Sector (Collection of Data) (reporting standard) determinations Nos. 1-17 of 2007, issued by the Australian Prudential Regulation Authority (APRA) under the Financial Sector (Collection of Data) Act 2001, apply to all authorised deposit-taking institutions, insurers, and certain other entities (referred to as "Managed Depositary Obligations" or MDOs) within the Australian financial sector. These determinations establish new reporting standards that replace the previous standards to align with Australian equivalents to international financial reporting standards (AIFRS). Each instrument revokes the old reporting standard and replaces it with a new one, ensuring consistency with the updated accounting standards and principles. The changes are intended to be comprehensive, incorporating adjustments to terminology, additions, and deletions to reflect the adoption of AIFRS. The reporting standards and accompanying forms and instructions have been revised to accommodate these changes, and the formatting of instruction guides has been updated for clarity. The new standards commenced on the later of 30 June 2007 or the date of registration of the instruments on the Federal Register of Legislative Instruments. APRA has consulted with all relevant MDOs and determined that a Regulation Impact Statement was not necessary due to the low impact of these changes on business and individuals.

Key Provisions

The main operative sections of the Financial Sector (Collection of Data) (reporting standard) determinations Nos. 1- 17 of 2007 (the instruments) are primarily concerned with the revocation and replacement of existing reporting standards that apply to Major Domestic Entities (MDOs) under the Financial Sector (Collection of Data) Act 2001 (the Act). The instruments, as referenced in paragraph 13(1)(a) of the Act, allow the Australian Prudential Regulation Authority (APRA) to determine reporting standards that MDOs must adhere to. These standards primarily involve the collection of financial and accounting data, as well as other information related to the business or activities of the entities (paragraph 13(1)(a)). The instruments revoke the previous reporting standards that were in effect as of 30 June 2004 and replace them with new standards that align with Australian equivalents to international financial reporting standards (AIFRS) (subsection 15(2)). The instruments impose specific obligations and requirements on the MDOs governed by them. These obligations include lodging returns under the new standards with APRA, completing the prescribed reporting forms, and adhering to the detailed technical instructions provided. The revised standards are designed to ensure that MDOs collect and report financial data in a manner that aligns with AIFRS, thereby maintaining consistency with Australian accounting standards and principles. Additionally, the instruments mandate the use of updated terminology and formatting in the reporting forms and instructions, reflecting the changes introduced by AIFRS. MDOs are also required to ensure that their reporting practices comply with these updated standards and instructions. The determinations do not explicitly outline specific offences, penalties, or civil/criminal consequences for breaches of the reporting standards. However, under the Act, non-compliance with the reporting requirements could potentially lead to enforcement actions by APRA. These actions could include the imposition of penalties, the issuance of directions to rectify non-compliance, or other regulatory measures deemed necessary to ensure adherence to the reporting standards. The precise nature and extent of these consequences would be determined based on the specific circumstances of any non-compliance and the discretion of APRA in enforcing the Act. APRA has considered the impact of these determinations to be low, as evidenced by the consultation process with the seven MDOs over a two-week period and the absence of a mandatory Regulation Impact Statement (RIS) or Business Cost-Benefit (BCC) report. The changes are primarily aimed at aligning the reporting framework with AIFRS, thereby maintaining consistency with Australian accounting standards and principles. The instruments reflect APRA's objective to provide a widely accepted basis for the recognition and measurement of assets, liabilities, equity, revenue, and expenses within the financial sector.

Legal classification tags

Area of Law
Financial Regulation
Instrument
Regulation
Concepts
Reporting & Disclosure Obligations
Regulatory Standards
Compliance Obligations

Interactions

Authorises

All Versions

Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.