NZASB Meeting 4 June 2020
Here is a summary of the main matters considered in the public sessions.
Going Concern Disclosures
The Board considered proposed amendments to FRS-44 New Zealand Additional Disclosures and PBE IPSAS 1 Presentation of Financial Statements to establish more specific disclosure requirements in respect of situations where management has determined that the going concern basis of preparation is appropriate and either:
- material uncertainties were considered in forming this view; or
- there are no material uncertainties but management is aware of events or conditions that may cast significant doubt on the entity’s ability to continue as a going concern.
The Board considered that establishing more specific requirements will help preparers of financial statements when applying the existing disclosure requirements in NZ IFRS and PBE Standards to provide useful information to users of those financial statements in the circumstances described above. The proposed disclosure requirements will also help align the requirements in accounting standards with going concern related disclosures expected by auditors when applying paragraphs 19 and 20 of auditing standard ISA (NZ) 570 (Revised) Going Concern.
The Board approved for issue two exposure drafts and accompanying invitations to comment. They are available on the XRB’s website (see the Open for Comment page).
For-profit Amending Standard Approved for Issue
The Board approved Covid-19-Related Rent Concessions, which amends NZ IFRS 16 Leases. The amending standard is applicable to Tier 1 and Tier 2 for-profit entities and is effective for annual reporting periods beginning on or after 1 June 2020. Earlier application is permitted, including in financial statements not yet authorised for issue at 11 June 2020.
The amendments provide a practical expedient to lessees applying NZ IFRS 16 during the covid-19 pandemic while enabling them to continue providing useful information about their leases to users of financial statements.
PBE IFRS 17 – Deferral of Effective Date
The International Accounting Standards Board (IASB) has decided to defer the effective date of IFRS 17 Insurance Contracts to 1 January 2023. When PBE IFRS 17 Insurance Contracts was issued, its effective date (that is, 1 January 2022) was aligned with the expected effective date of IFRS 17 (and NZ IFRS 17 Insurance Contracts).
The NZASB is proposing to defer the effective date of PBE IFRS 17 by one year (that is, from 1 January 2022 to 1 January 2023). This will result in the effective date of PBE IFRS 17 being the same as the effective date of IFRS 17 and NZ IFRS 17.
The Board approved for issue an exposure draft and invitation to comment to amend PBE IFRS 17 so that it is effective for annual financial statements covering periods beginning on or after 1 January 2023. They are available on the XRB’s website (see the Open for Comment page).
The Board received a presentation on aspects of the International Auditing and Assurance Standards Board’s consultation paper Proposed Non-Authoritative Guidance EER Assurance from a member of the XRB’s Auditing and Assurance Standards team. The Board raised questions on some of the content in Supplement A Credibility and Trust Model and Background and Contextual Information.
Next NZASB meeting
Wednesday 17 June 2020
This meeting summary refers to the work of the International Accounting Standards Board (IASB) and the International Public Sector Accounting Standards Board (IPSASB) and uses registered trademarks of the IFRS Foundation (for example, IFRS® Standards, IFRIC® Interpretations and IASB® papers).
Date And Time
- Level 7
50 Manners Street
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