NZASB Update #17

This NZASB Update provides you with an overview of the New Zealand Accounting Standards Board’s recent activities, any new standards or interpretations, as well as other matters of interest.

New Standards issued

Amendments to PBE Tier 3 and Tier 4 Accounting Requirements


Not-for-profitPublic Sector


The NZASB has now issued 2018 Omnibus Amendments to Tier 3 and Tier 4 PBE Accounting Requirements for registered charities and public sector entities.

The scope of the amendments is limited to alignments with other pronouncements such as the PBE Conceptual Framework, clarifications of existing requirements and some minor editorials.

The only new requirement is that the performance report now must be signed and dated—as evidence it has been approved by the relevant authorised parties in the entity.

These amendments are effective for reporting periods beginning 1 January 2019, with early adoption permitted.

See the Tier 3 standard

See the Tier 4 standard


Disclosure Concessions for NZ IFRS 16 and NZ IAS 7


For-profit


The NZASB has issued RDR NZ IFRS 16 and NZ IAS 7 following approval at its June meeting.

The Reduced Disclosure Requirements (RDR) concessions are for Tier 2 for-profit entities applying:

  • NZ IFRS 16 Leases; and
  • NZ IAS 7 Statement of Cash Flows as amended by Disclosure Initiative (Amendments to NZ IAS 7).

The RDR concessions were not approved when NZ IFRS 16 Leases and Disclosure Initiative (Amendments to NZ IAS 7) were issued in 2016.

Tier 2 for-profit entities applying the new standards will find these amendments useful.

The standard has an effective date for periods beginning on or after 1 January 2019, with early adoption permitted.

See the amendments


Explanatory Guides updated


For-profitNot-for-profitPublic Sector


At its June meeting the XRB Board agreed to amendments to two XRB Explanatory Guides (EGs):

  • EG A1: Guide to application of the Accounting Standards Framework
  • EG A2: Overview of the accounting standard-setting process

In May 2018 the NZASB issued the New Zealand equivalent to the International Accounting Standards Board’s (IASB) Conceptual Framework for Financial Reporting (2018 NZ Conceptual Framework).

These two EGs have now been amended to reflect this along with other miscellaneous matters.

EG A1

EG A2

Unlike standards, explanatory guides have no legal status.  They are simply documents explaining and supporting their relevant standards.

How are our standards set? 

Did you know we now feature all the standard-setting flow charts from EG A2 on our website?  This gives you an at-a-glance view of all the steps involved.

Have a look


Key terms in Insurance Contracts


For-profit


Insurance contract imageThe IASB has just released an easy-to-read list of key terms on Insurance Contracts to assist you when you start reading IFRS 17 Insurance Contracts. 

(Note that Appendix A of IFRS 17 contains the fully-defined terms). 

 


Disclosure of Significant Accounting Estimates


For-profit


FMA logoThe Financial Markets Authority (FMA) has published an Information Sheet entitled Disclosure of Significant Accounting Estimates highlighting their recent review of a range of entity financial statements that shows a lack of disclosure in significant accounting estimates and assumptions, particularly those containing high levels of uncertainty.

The Information Sheet provides a list of common areas of concern:

  1. potential liabilities subject to the outcome of litigation;
  2. recognition and measurement of revenues of long term contracts; 
  3. recognition and measurement of any expected contract losses;
  4. unobservable inputs used in assessments of the fair value or recoverable amount of an asset or liability;
  5. recognition and measurement of a group of insurance contracts; and
  6. the cost of a business combination when consideration is contingent on future performance or events.

Have a look


New Not-for-profit Update


Not-for-profit


NFP Update promo imageHave you enjoyed receiving the NZASB Update? We hope so!

Now we are about to publish a brand new Not-for-profit Update, especially for registered charities and other not-for-profit entities where we will highlight recent matters of interest.

Want to receive it? 

Sign up here

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Please get others in your organisation or in other not-for-profits you know to sign up as well!


Have your say...


For-profitNot-for-profitPublic Sector


Before issuing a finalised accounting standard the NZASB and international standard-setting boards, such as 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 tables below. 

We welcome your comments and feedback, either formal or informal, by the due dates below. Tell us how these changes could affect your entity or the entities you work with.


For-profit


ID

Title

Comments due to the NZASB

Comments due to the IASB

IASB ED/2018/1

Accounting Policy Changes (Proposed amendments to IAS 8)

CLOSED

27 Jul 2018

IASB DP/2018/1

Financial Instruments with Characteristics of Equity

7 Nov 2018

7 Jan 2019


Not-for-profitPublic Sector


Tier 1 & 2

ID

Title

Comments due to the NZASB

Comments due to the IPSASB

NZASB ED 2018-3

2018 Omnibus Amendments to PBE Standards

28 Sept 2018

N/A


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This NZASB Update is intended to provide subscribers with a summary of the recent activities of the New Zealand Accounting Standards Board (NZASB). Links to websites are correct at the time of publication. Subscribers should not rely on this newsletter as a definitive publication of updates. The External Reporting Board and its sub-Board the NZASB do not guarantee, and accept no legal liability whatsoever arising from or connected to, the accuracy, reliability, currency, timeliness or completeness of this newsletter. The information contained in this newsletter does not constitute advice and should not be relied upon as such.