Financial Sector (Collection of Data) (reporting standard) determination No. 7 of 2007 - MRS 140.1 - Investments - Direct Equity Holdings

Administered by Department of the Treasury

Legislation au F2007L02093 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 enacted to address the need for a standardised reporting framework for Major Deposit-taking Institutions (MDOs) in response to Australian equivalents to international financial reporting standards (AIFRS). These determinations seek to align APRA’s reporting standards with Australian accounting standards and principles to the extent practicable, ensuring a widely accepted basis for the recognition and measurement of assets, liabilities, equity, revenue, and expenses. APRA determined that it would be more effective to revoke and replace existing reporting standards with new ones that incorporate necessary adjustments, rather than merely amending them. This approach also provided an opportunity to update the formatting and instructions attached to the reporting standards. The changes, which include terminology updates and improvements to the formatting and references, aim to enhance clarity and effectiveness in the reporting framework for MDOs.

Scope and Application

The Financial Sector (Collection of Data) (Reporting Standard) Determinations Nos. 1-17 of 2007, issued under the Financial Sector (Collection of Data) Act 2001, apply to Managed Investment Schemes (MDOs) in Australia, requiring them to comply with updated reporting standards for financial and accounting data. These determinations, issued by the Australian Prudential Regulation Authority (APRA), revoke and replace the previously established reporting standards to incorporate changes in alignment with Australian equivalents to International Financial Reporting Standards (AIFRS). The new standards include revisions to terminology, additions to reporting requirements, and deletions to ensure consistency with updated accounting principles. The changes aim to align APRA's reporting framework with widely accepted accounting standards, facilitating effective recognition and measurement of financial elements. The new reporting standards became effective on the later of 30 June 2007 or the date of registration of the instruments on the Federal Register of Legislative Instruments.

Key Provisions

The main operative sections of the Financial Sector (Collection of Data) (reporting standard) determinations Nos. 1-17 of 2007 (the instruments) pertain to the replacement and consolidation of existing reporting standards for managed investment schemes (MIS), as outlined in section 13(1)(a) of the Financial Sector (Collection of Data) Act 2001. These determinations revoke and replace the original reporting standards that were initially set on 29 June 2004, with the new standards reflecting adjustments due to Australian equivalents to international financial reporting standards (AIFRS). The new standards are designed to align with Australian accounting standards and principles, ensuring a consistent and widely accepted basis for the recognition and measurement of financial data. The instruments also include revised reporting forms and technical instructions, updated to reflect changes resulting from AIFRS. The Act imposes specific obligations on the entities it governs, namely, the Managed Investment Schemes (MIS) to which section 5A of the Act applies. These entities must comply with the new reporting standards by lodging the required financial and accounting data with the Australian Prudential Regulation Authority (APRA) as specified in the revised reporting forms and instructions. The new standards mandate the use of AIFRS and prudential terminology, making certain changes to the terminology used in previous reporting standards, such as replacing "Market value" with "Fair value" and "Provision for deferred tax" with "Deferred tax liability." Additionally, new elements such as "Paid up ordinary shares" and "Other liabilities" have been introduced, while certain items like "Goodwill amortisation" have been deleted. In terms of compliance, the instruments require MIS to adhere to the new reporting standards, which are effective from the later of 30 June 2007 and the date of registration of the instruments on the Federal Register of Legislative Instruments, as declared under subsection 15(2) of the Act. MIS must ensure that their reporting forms are completed accurately and in accordance with the detailed technical instructions provided. Failure to comply with these standards may result in various consequences, although the Explanatory Statement notes that a Regulation Impact Statement or Business Cost Compliance report is not mandatory due to the low impact of these changes on business and individuals, including compliance costs. The determinations do not explicitly outline specific offences, penalties, or civil/criminal consequences for non-compliance within the provided text. However, given the regulatory nature of the Act and APRA's oversight, it is reasonable to infer that breaches of these reporting standards could lead to enforcement actions by APRA. Such actions may include formal warnings, fines, or other regulatory measures to ensure compliance. Although the maximum penalties are not detailed in the provided text, they would typically be determined based on the severity and frequency of the non-compliance, as well as any resultant impact on the financial sector's stability and integrity.

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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.