Scope
2
The classification and presentation requirements of this Standard apply to all recognised non-current assets[1] and to all disposal groups of an entity. The measurement requirements of this Standard apply to all recognised non-current assets and disposal groups (as set out in paragraph 4), except for those assets listed in paragraph 5 which shall continue to be measured in accordance with the Standard noted.
Aus2.1
The requirements in this Standard do not apply to:
(a) the restructuring of administrative arrangements; and
(b) the restructuring of administered activities of government departments.
Aus2.2
AASB 1004 Contributions includes requirements for the disclosure of assets, liabilities and items of equity resulting from the restructuring of administrative arrangements.
Aus2.3
An administered activity of a government department does not give rise to income and expenses of the department reporting the administered activity (see AASB 1050 Administered Items) and therefore, from the point of view of the department, the discontinuance of an administered activity does not give rise to a discontinued operation. However, if a government were to discontinue an activity that one of its departments had disclosed as an administered activity, from the point of view of that government the discontinuance may constitute a discontinued operation.
Aus2.4
Although AASB 3 Business Combinations contains requirements relating to the restructuring of local governments, these requirements only apply to the local government receiving assets or liabilities as a result of the restructuring. This Standard applies to the local government transferring assets and liabilities where the restructuring results in a discontinued operation of the transferor local government.
3
Assets classified as non-current in accordance with AASB 101 Presentation of Financial Statements shall not be reclassified as current assets until they meet the criteria to be classified as held for sale in accordance with this Standard. Assets of a class that an entity would normally regard as non-current that are acquired exclusively with a view to resale shall not be classified as current unless they meet the criteria to be classified as held for sale in accordance with this Standard.
4
Sometimes an entity disposes of a group of assets, possibly with some directly associated liabilities, together in a single transaction. Such a disposal group may be a group of cash-generating units, a single cash-generating unit, or part of a cash-generating unit [2]. The group may include any assets and any liabilities of the entity, including current assets, current liabilities and assets excluded by paragraph 5 from the measurement requirements of this Standard. If a non-current asset within the scope of the measurement requirements of this Standard is part of a disposal group, the measurement requirements of this Standard apply to the group as a whole, so that the group is measured at the lower of its carrying amount and fair value less costs to sell. The requirements for measuring the individual assets and liabilities within the disposal group are set out in paragraphs 18, 19 and 23.
5
The measurement provisions of this Standard[3] do not apply to the following assets, which are covered by the Australian Accounting Standards listed, either as individual assets or as part of a disposal group:
(a) deferred tax assets (AASB 112 Income Taxes).
(b) assets arising from employee benefits (AASB 119 Employee Benefits).
(c) financial assets within the scope of AASB 9 Financial Instruments.
(d) non-current assets that are accounted for in accordance with the fair value model in AASB 140 Investment Property.
(e) non-current assets that are measured at fair value less costs to sell in accordance with AASB 141 Agriculture.
(f) contractual rights under insurance contracts as defined in AASB 4 Insurance Contracts.
5A
The classification, presentation and measurement requirements in this Standard applicable to a non-current asset (or disposal group) that is classified as held for sale apply also to a non-current asset (or disposal group) that is classified as held for distribution to owners acting in their capacity as owners (held for distribution to owners).
5B
This Standard specifies the disclosures required in respect of non-current assets (or disposal groups) classified as held for sale or discontinued operations. Disclosures in other Standards do not apply to such assets (or disposal groups) unless those Standards require:
(a) specific disclosures in respect of non-current assets (or disposal groups) classified as held for sale or discontinued operations; or
(b) disclosures about measurement of assets and liabilities within a disposal group that are not within the scope of the measurement requirement of AASB 5 and such disclosures are not already provided in the other notes to the financial statements.
Additional disclosures about non-current assets (or disposal groups) classified as held for sale or discontinued operations may be necessary to comply with the general requirements of AASB 101, in particular paragraphs 15 and 125 of that Standard.
For assets classified according to a liquidity presentation, non-current assets are assets that include amounts expected to be recovered more than twelve months after the reporting period. Paragraph 3 applies to the classification of such assets.
However, once the cash flows from an asset or group of assets are expected to arise principally from sale rather than continuing use, they become less dependent on cash flows arising from other assets, and a disposal group that was part of a cash-generating unit becomes a separate cash-generating unit.
Other than paragraphs 18 and 19, which require the assets in question to be measured in accordance with other applicable Australian Accounting Standards.