Fair Presentation and Compliance with AuFair Presentation and Compliance with Australian Accounting Standards

Fair Presentation and Compliance with Australian Accounting Standards

13. A financial report shall present fairly the financial position, financial performance and cash flows of an entity. Fair presentation requires the faithful representation of the effects of transactions, other events and conditions in accordance with the definitions and recognition criteria for assets, liabilities, income and expenses set out in the Framework. The application of Australian Accounting Standards, with additional disclosure when necessary, is presumed to result in a financial report that achieves a fair presentation.

Aus13.1 The Corporations Act requires an entity’s financial report to comply with Australian Accounting Standards and, if necessary to give a true and fair view, further information to be disclosed in the notes.

Aus13.2 An entity shall disclose in the notes a statement whether the financial report has been prepared in accordance with Australian Accounting Standards.

Aus13.3 The financial reporting framework applied in the preparation of the financial report is identified in the summary of accounting policies so that users understand the basis on which the financial report has been prepared. In addition to stating whether the financial report has been prepared in accordance with Australian Accounting Standards, it may also be appropriate to indicate the relevant statutory and other requirements adopted in the preparation of the financial report.

Aus13.4 An entity shall disclose in the notes a statement that the financial report is a general purpose financial report, or if applicable, a special purpose financial report.

14. An entity whose financial statements and notes comply with IFRSs shall make an explicit and unreserved statement of such compliance in the notes. The financial statements and notes shall not be described as complying with IFRSs unless they comply with all the requirements of IFRSs.

Aus14.1 Where an entity can make the explicit and unreserved statement of compliance in respect of only:

(a) the parent financial statements and notes; or

(b) the consolidated financial statements and notes;

the entity shall make the explicit and unreserved statement of compliance in accordance with paragraph 14 and clearly identify to which financial statements and notes it relates.

Aus14.2 Compliance with Australian equivalents to IFRSs by for-profit entities will not necessarily lead to compliance with IFRSs. This circumstance arises when the entity is a for-profit government department to which particular Standards apply, such as AASB 1004 Contributions, and to which Aus paragraphs in various other Australian Accounting Standards apply. Those requirements override the requirements in an Australian equivalent to IFRSs that would otherwise apply.