The Australian Accounting Standards Board has issued two new Accounting Standards, AASB 15 (Revenue from contracts with customers) and AASB 16 (Leases). These two new accounting standards are expected to have a significant impact on the preparation of financial statements, calculations and disclosures your staff will have to prepare, as well as the extent of the audit procedures your auditor is required to perform if your organisation prepares General Purpose (RDR) Financial Reports.
Consideration should be given whether the users of the financial statements are dependent on General Purpose Financial Reports for information; or making and evaluating resource allocation decisions. If it is found that the users are not dependent on General Purpose Financial Reports, we recommend management moves away from General Purpose Financial Reporting to Special Purpose Financial Reporting. This will ensure current accounting policies are maintained and implementation of the above changes to accounting policies is not required.
We will work with the management team to determine the impact of these Standards and confirm that proposed accounting treatments are in accordance with the new Standards. We recommend that this work is completed well before the required implementation date so that any financial statement implication can be understood and resolved prior to application date.
Click below for summaries and practical examples of the key elements in these respective Standards.