Financial Sector (Collection of Data) (reporting standard) determination No. 4 of 2007 - MRS 130.2 - Off Balance Sheet Business - Charges Granted

Administered by Department of the Treasury

Legislation au F2007L02083 Not in force Legislative Instrument

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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, issued by the Australian Prudential Regulation Authority (APRA) under the Financial Sector (Collection of Data) Act 2001, were introduced to address the need for updating the reporting standards for Managed Investment Schemes (MDOs) in light of the adoption of Australian equivalents to international financial reporting standards (AIFRS). These determinations revoke and replace the existing reporting standards to ensure alignment with AIFRS, thereby maintaining the integrity and comparability of financial reporting within the financial sector. APRA's approach ensures that the reporting standards reflect current accounting principles, which provide a widely accepted basis for the recognition and measurement of financial elements. The purpose of these instruments is to establish new reporting standards that incorporate adjustments necessitated by AIFRS while also improving the formatting and clarity of the reporting forms and instructions. This systematic update aims to facilitate compliance and enhance the quality of financial data collected by APRA.

Scope and Application

The Financial Sector (Collection of Data) (reporting standard) determinations Nos. 1-17 of 2007 apply to all Managed Investment Schemes (MIS) and Deposit Taking Institutions (DTIs) as defined under the Financial Sector (Collection of Data) Act 2001 (the Act). These entities, collectively referred to as Managed Depositary Organisations (MDOs), are mandated to comply with the new reporting standards that have been established under the authority conferred by the Act. The reporting standards pertain to the collection of financial and accounting data, as well as other relevant information concerning the business and activities of these entities. Geographically, the application of these standards is confined to Australia, as the Act is a Commonwealth legislation. There are no specific exclusions, exemptions, or thresholds outlined in the determinations; however, the standards are designed to align with the Australian equivalents of international financial reporting standards (AIFRS), ensuring consistency and comparability in financial reporting. The determinations also allow for potential amendments or variations through subordinate instruments, subject to the conditions specified in the Acts Interpretation Act 1901.

Key Provisions

The main operative sections of the Financial Sector (Collection of Data) (Reporting Standard) Determinations Nos. 1-17 of 2007 are those that revoke and replace the existing reporting standards for financial sector entities, in this case, managed investment schemes (MIS) (section 1). These new standards are designed to align with Australian equivalents to international financial reporting standards (AIFRS), reflecting changes in accounting practices and terminology. The new standards are to be applied by all MIS from the later of 30 June 2007 and the date of registration of the instruments on the Federal Register of Legislative Instruments (subsection 15(2) of the Act). Each of the determinations revokes a corresponding existing reporting standard and introduces a new one, with accompanying reporting forms and technical instructions (section 1). The obligations imposed by these determinations require MIS to adhere to the new reporting standards, which include completing revised reporting forms and following the updated technical instructions provided. MIS must ensure that they lodge the required returns with the Australian Prudential Regulation Authority (APRA) as specified within the body of each new reporting standard (section 1). The new standards incorporate adjustments to reflect changes due to the adoption of AIFRS, including updates to terminology, additions to reporting requirements, and deletions of certain previously reported items (section 3). MIS must be aware of these changes to ensure compliance with the new standards. The determinations also include provisions for offences and penalties, although specific penalties are not detailed in the explanatory statement. Generally, under the Financial Sector (Collection of Data) Act 2001, breaches of the reporting standards may result in civil or criminal penalties. Civil penalties can include fines, while criminal penalties may include imprisonment, reflecting the seriousness of non-compliance with regulatory reporting requirements. The maximum penalties would be determined by the specific provisions of the Act and any relevant case law or regulatory guidelines. The instruments' operation ensures that MIS reporting aligns with contemporary accounting standards, thereby enhancing the accuracy and relevance of the data collected by APRA. This alignment is crucial for effective prudential regulation and oversight of the financial sector. The updates to the formatting and references of the instruction guides, while not affecting the content of the reporting standards, aim to improve clarity and usability for the entities required to comply with these standards.

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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.