Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Adoption of International Accounting Standards

For immediate release 28 August 2003

Adoption of International Accounting Standards -

Latest Update

The Financial Reporting Standards Board (FRSB) has released three new Exposure Drafts for public comment.

The release continues the New Zealand accounting profession's move to adopt the International Financial Reporting Standards (IFRS) framework by 1 January 2007, with voluntary compliance from 1 January 2005.

The three exposure drafts are:

- ED NZ IAS 1 Presentation of Financial Statements

- ED NZ IAS 23 Borrowing Costs and

- ED NZ IAS 37 Provisions, Contingent Liabilities and Contingent Assets.

ED NZ IAS 1 relates to the Presentation of Financial Statements and prescribes the basis for the presentation of general-purpose financial statements, guidelines for their structure and minimum requirements for the content of financial statements.

A profit-oriented entity complying with NZ IFRS will simultaneously comply with IFRS. However, where a public benefit entity complies with NZ IFRS, the entity will comply with IFRS only if the additional requirements (if any) on measurement and recognition are not applicable to the entity.

The ED clarifies that the regulatory framework in New Zealand prohibits departures from compliance with the requirements of a financial reporting standard. It also retains the existing requirement in FRS-9 to require all entities that have published prospective financial information to present a comparison of prospective financial information with actual financial results.

The ED includes additional guidance for public benefit entities on a number of areas, including retaining the existing FRS-2 Section C requirements and discussion on Statements of Service Performance.

ED NZ IAS 23 prescribes the accounting treatment for borrowing costs. Currently the subject of international debate, the adoption of ED NZ IAS 23 is not expected to lead to any change in the treatment of borrowing costs by individual entities as it continues to permit the immediate expensing of borrowing costs or its capitalisation.

ED NZ IAS 37 provides for the recognition of provisions and disclosure of provisions, contingent liabilities and contingent assets. The ED differs from the existing FRS-15 in the definition and recognition criteria for contingent assets. Adoption of the proposed NZ IAS 37 would possibly lead to disclosure of fewer contingent assets and non-recognition of some contingent assets.

Consistent with FRS-15, the ED includes an exemption for certain obligations of the Crown which are expressed in legislation that have characteristics similar to an executory contract. This exclusion was provided because these obligations raise issues for financial reporting that require further study. The ED also retains the two examples in Appendix 3 of FRS-15 for public benefits entities.

The Exposure Draft and Discussion Paper for each of the three proposed standards is available for download free of charge from the Institute of Chartered Accountants' website at www.icanz.co.nz

The closing date for submissions on the three Exposure Drafts is 31 October 2003.


Backgrounder:

- The Financial Reporting Standards Board (FRSB) is implementing the Accounting Standards Review Board's (ASRB) decision to adopt International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB).

- Application of the standards will be to reporting periods beginning on or after 1 January 2007 (or, in the case of entities choosing to adopt early, reporting periods beginning on or after 1 January 2005). Note: This is still subject to Government approval.

- The ASRB and the FRSB have agreed that there should be one set of standards for application by both profit-oriented and public benefit entities. However, IFRS are developed for application by profit-oriented entities. As a consequence, the FRSB intends to adopt IFRS but, where necessary, introduce additional material to the standards to ensure that they can be applied in the New Zealand environment by all reporting entities. The resulting New Zealand standards will be referred to as NZ IFRSs or NZ IASs, as appropriate.

- The IASB is currently revising the existing international standards and the FRSB will issue drafts of the New Zealand standards as the international standards are finalised or near to being finalised. The FRSB is also issuing drafts of New Zealand standards adapted from new international standards. The FRSB aims to complete by June 2004 the conversion process of both existing international standards and new standards issued by the IASB through to March 2004. In total, close to 40 exposure drafts will be issued.

- The objectives of the FRSB's exposure of the proposed New Zealand standards are:

- to ensure reasonable steps are taken to obtain submissions from persons or organisations or their representatives who will be affected by the adoption of the standard and, in particular, by the proposed New Zealand specific changes to the international standard;

- to identify issues in relation to the international standard that the FRSB should raise with the IASB; and

- to alert constituents to changes in financial reporting as a result of adoption of international standards.


© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Onetai Station: Overseas Investment Office Puts Ceol & Muir On Notice

The Overseas Investment Office (OIO) has issued a formal warning to Ceol & Muir and its owners, Argentinian brothers Rafael and Federico Grozovsky, for failing to provide complete and accurate information when they applied to buy Onetai Station in 2013. More>>

ALSO:

Tomorrow, The UN: Feds President Takes Reins At World Farming Body

Federated Farmers president Dr William Rolleston has been appointed acting president of the World Farmers’ Organisation (WFO) at a meeting in Geneva overnight. More>>

ALSO:

I Sing The Highway Electric: Charge Net NZ To Connect New Zealand

BMW is turning Middle Earth electric after today announcing a substantial contribution to the charging network Charge Net NZ. This landmark partnership will enable Kiwis to drive their electric vehicles (EVs) right across New Zealand through the installation of a fast charging highway stretching from Kaitaia to Invercargill. More>>

ALSO:

Watch This Space: Mahia Rocket Lab Launch Site Officially Opened

Economic Development Minster Steven Joyce today opened New Zealand’s first orbital launch site, Rocket Lab Launch Complex 1, on the Mahia Peninsula on the North Island’s east coast. More>>

Earlier:

Marketing Rocks!
Ig Nobel Award Winners Assess The Personality Of Rocks

A Massey University marketing lecturer has received the 2016 Ig Nobel Prize for economics for a research project that asked university students to describe the “brand personalities” of three rocks. More>>

ALSO:

Nurofen Promotion: Reckitt Benckiser To Plead Guilty To Misleading Ads

Reckitt Benckiser (New Zealand) intends to plead guilty to charges of misleading consumers over the way it promoted a range of Nurofen products, the Commerce Commission says. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news