NZASB Update 8/2020

COVID-19 Response: PBE FRS 48 Service Performance Reporting ― Proposal to defer effective date

In November 2017 the NZASB issued PBE FRS 48 with an effective date of reporting periods beginning on or after 1 Jan 2021 (early adoption permitted). The new standard established requirements for service performance reporting by Tier 1 and Tier 2 public benefit entities (PBEs) in both the public and not-for-profit sectors.

Service performance information is information about what the entity has done during the reporting period in working towards its broader aims and objectives, together with supporting contextual information. 

Given the disruption to the operations of many PBEs during 2020 as a result of COVID-19 the NZASB has become aware that some PBEs may be unable to successfully implement PBE FRS 48 Service Performance Reporting by its effective date. The Board is therefore proposing to defer the effective date of PBE FRS 48 by one year (from 1 January 2021 to 1 January 2022). The standard would remain available for early adoption.

The Board stressed its ongoing support for the objective of the standard (being to establish principles and requirements for an entity to present service performance information that is useful for accountability and decision-making purposes) and the importance of service performance information for users of PBE financial reports. In proposing to defer the effective date of the standard the Board was motivated by a desire to provide affected PBEs with more time, in the current circumstances, to successfully implement the standard and meet this objective.

The Board approved an exposure draft (ED) for issue. The closing date for submissions is 10 August 2020.

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COVID-19 response: Classification of Liabilities as Current or Non-current–Proposal to defer effective date

As part of its response to COVID-19, the IASB is proposing to defer the effective date of Classification of Liabilities as Current or Non-current which amends IAS 1 Presentation of Financial Statements from 1 January 2022 to 1 January 2023.

We encourage Tier 1 and Tier 2 for-profit entities to comment on this ED directly to the IASB (with a copy to the NZASB) as it has a short 30-day comment period.

Comments are due to the IASB by 3 June 2020. 

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Recent NZASB Meeting

7 May 2020 

Applies to: For-profitNot-for-profitPublic Sector

The May NZASB meeting was held via video conference.

The Board considered:

• in response to COVID-19, two options for relief from PBE FRS 48 Service Performance Reporting and decided to propose the deferral of the effective date of PBE FRS 48 from 1 January 2021 to 1 January 2022. An Exposure Draft (ED) and Invitation to Comment has been issued;
• proposals in the three IPSASB EDs on revenue and transfer expenses;
• a draft Request for Information for the Post-implementation Review of Tier 3 and Tier 4 Simple Format Reporting Standards;
• proposals in the IASB Discussion Paper Business Combinations—Disclosures, Goodwill and Impairment; and
• the approach for determining Tier 2 for-profit entity disclosures in the future.

The Board also agreed, in response to COVID-19 considerations, to commence a domestic 
standards-level project on improving going concern disclosures for Tier 1 and Tier 2 for-profit entities and PBEs. The scope would be limited to situations where management’s going concern assessment has involved significant judgement and/or the consideration of material uncertainties.   

You can still access the public agenda and public meeting papers and website notice for the May meeting on our website. 

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The June meetings of the NZASB will be held in a virtual setting and are scheduled as follows:

• Thursday, 4 June 2020 – morning only; and
• Wednesday, 17 June 2020 – full day.

Have your say…

Before issuing a finalised accounting standard the NZASB and the international standard-setting boards, the IASB and the IPSASB, issue consultation documents. These documents seek your feedback on proposals that could potentially affect you.

We are currently consulting on the matters set out in the table below. 

Tell us how these changes could affect your entity or the entities you work with.

We welcome your comments and feedback, either formal or informal, by the due dates below.

You can submit your comments directly from the Exposure Draft pages on our website following the links below.

Domestic Consultation Documents

IASB Consultation Documents

IPSASB Consultation Documents