AASB 2023-5 amends accounting requirements in these 3 AASB standards, adds new disclosures re non-exchangeable currencies affecting an entity’s financial statements.
In addition, AST GVT published an explanatory statement with respect to the same.
AASB said these amendments arise from issuance of International Financial Reporting Standard (IFRS) lack of exchangeability amendments to IAS 21 by IASB in Aug. 2023.
AASB consulted in relation to these amendments, and no submissions were received.
AASB 2023-5 uses underlining, striking out and other typographical material to identify some of the amendments, in order to make the amendments more understandable.
Overview of Amendments
AASB explained that AASB 2023-5 amends AASB 121, as well as AASB 1, in order to improve the usefulness of information provided to users of financial statements.
Amendments require entities to apply a consistent approach in determining whether or not a currency is exchangeable into another currency, and spot exchange rate to use.
Also extends exemption from complying with disclosure requirements of AASB 121 for entities that apply AASB 1060, to ensure Tier 2 entities do not have to comply with new disclosure requirements in AASB 121 when preparing Tier 2 financial statements.
Application
States AASB 2023-5 applies to annual periods beginning on or after Jan. 1, 2025.
Earlier application is permitted for annual periods beginning before Jan. 1, 2025.
Effectiveness
This legislative instrument commences on Dec. 31, 2024.
Regulators
AST GVT
Entity Types
Auditor; Corp
Reference
RF F2023L01377, 10/13/2023; IAS 21; Citation: AASB 1 first-time adoption of Australian accounting standards -July 2015; AASB 121 the effects of changes in foreign exchange rates - August 2015; AASB 1060 general purpose financial statements - simplified disclosures for for-profit and not-for-profit tier 2 entities - March 2020; Accounting standard AASB 2023-5 amendments to Australian accounting standards - lack of exchangeability;
