General Purpose or Special Purpose Financial Statements (AASB1054_05-11_COMPdec22_01-23)

An entity shall disclose in the notes whether the financial statements are general purpose financial statements or special purpose financial statements.

A not-for-profit private sector entity that prepares special purpose financial statements shall:

(a) disclose the basis on which the decision to prepare special purpose financial statements was made;

(b) where the entity has interests in other entities – disclose either:

(i) whether or not its subsidiaries and investments in associates or joint ventures have been consolidated or equity accounted in a manner consistent with the requirements set out in AASB 10 Consolidated Financial Statements or AASB 128 Investments in Associates and Joint Ventures, as appropriate. If the entity has not consolidated its subsidiaries or equity accounted its investments in associates or joint ventures consistently with those requirements, it shall disclose that fact, and the reasons why; or

(ii) that the entity has not determined whether its interests in other entities give rise to interests in subsidiaries, associates or joint ventures, provided it is not required by legislation to make such an assessment for the purpose of assessing its financial reporting requirements and has not made such an assessment;

(c) for each material accounting policy applied and disclosed in the financial statements that does not comply with all the recognition and measurement requirements in Australian Accounting Standards (except for requirements set out in AASB 10 or AASB 128), disclose an indication of how it does not comply; or if such an assessment has not been made, disclose that fact; and

(d) disclose whether or not the financial statements overall comply with all the recognition and measurement requirements in Australian Accounting Standards (except for requirements set out in AASB 10 or AASB 128) or that such an assessment has not been made.

Implementation guidance and illustrative examples for not-for-profit private sector entities accompanies this Standard. It illustrates the application of the requirements in paragraph 9A and their relationship to the requirements in AASB 101 Presentation of Financial Statements for the disclosure of an entity’s material accounting policy information.

The special purpose financial statements of a for-profit private sector entity that is required only by its constituting document or another document (created before 1 July 2021 and not amended on or after that date) to prepare financial statements that comply with Australian Accounting Standards shall:

(a) disclose the basis on which the decision to prepare special purpose financial statements was made;

(b) disclose the following about the material accounting policies applied in the special purpose financial statements, if not already required by another Australian Accounting Standard:

(i) the measurement basis (or bases) applied in preparing the special purpose financial statements; and

(ii) the other accounting policies applied that are relevant to an understanding of the special purpose financial statements;

(c) when a change in a material accounting policy has an effect on the current period or any prior period, disclose the following, if not already required by another Australian Accounting Standard:

(i) the nature of the change in accounting policy;

(ii) the reasons why applying the new accounting policy provides reliable and more relevant information;

(iii) to the extent practicable, the amount of the adjustment for each financial statement line item affected, shown separately:

(A)            for the current period;

(B)            for each prior period presented; and

(C)            in the aggregate for periods before those presented; and

(iv) an explanation if it is impracticable to determine the amounts to be disclosed under paragraph (iii).

Financial statements of subsequent periods need not repeat these disclosures;

(d) where the entity has interests in other entities – disclose whether or not its subsidiaries and investments in associates or joint ventures have been consolidated or equity accounted in a manner consistent with the requirements set out in AASB 10 Consolidated Financial Statements or AASB 128 Investments in Associates and Joint Ventures, as appropriate. If the entity has not consolidated its subsidiaries or equity accounted its investments in associates or joint ventures consistently with those requirements, it shall also disclose the reasons why that is the case;

(e) for each material accounting policy applied and disclosed in the financial statements that does not comply with all the recognition and measurement requirements in Australian Accounting Standards (except for AASB 10 and AASB 128), disclose an indication of how it does not comply; and

(f) disclose whether or not the financial statements overall comply with all the recognition and measurement requirements in Australian Accounting Standards (except for AASB 10 and AASB 128).

Implementation guidance and illustrative examples for certain for-profit private sector entities accompanies this Standard. It illustrates the application of the requirements in paragraph 9C.