Making reporting easier

The Australian Accounting Standards Board (AASB) and the International Accounting Standards Board (IASB) have announced they are working collaboratively on a range of initiatives to address concerns about information overload in financial statements.

As part of the effort, the AASB has issued amendments to AASB 101 Presentation of financial statements to clarify that entities should not be disclosing immaterial information and that the presentation of information in notes can and should be tailored to provide investors and other users with the clearest story of an entity’s financial performance and financial position.

The amendments are part of a series of projects being undertaken by the IASB, collectively referred to as the Disclosure initiative. The AASB is contributing to all of the IASB’s work on this initiative and is also taking steps to improve financial reporting disclosures in Australia. These improvements have included the recent publication of the AASB paper To disclose or not to disclose: materiality is the question.

The AASB will also undertake a post implementation review of its reduced disclosure requirements regime that can be applied by entities that do not have public accountability.  This review is scheduled to commence later this year.

The amendments made to AASB 101 are contained in the amending standard AASB 2015-2 Amendments to Australian accounting standards ─ disclosure initiative: amendments to AASB 101.  These amendments will be effective for annual reporting periods beginning on or after 1 January 2016. Earlier application of the amendments is permitted.

The amendments can be found here.