Preface
Introduction
The Australian Accounting Standards Board (AASB) makes Australian Accounting Standards, including Interpretations, to be applied by:
(a) entities required by the Corporations Act 2001 to prepare financial reports;
(b) governments in preparing financial statements for the whole of government and the General Government Sector (GGS); and
(c) entities in the private or public for-profit or not-for-profit sectors that are reporting entities or that prepare general purpose financial statements.
Australian Accounting Standards incorporate International Financial Reporting Standards (IFRSs), including Interpretations, issued by the International Accounting Standards Board (IASB), with the addition of paragraphs on the applicability of the Standard in the Australian environment.
Australian Accounting Standards also include requirements that are specific to Australian entities. These requirements may be located in Australian Accounting Standards that incorporate IFRSs or in other Australian Accounting Standards. In most instances, these requirements are either restricted to the not-for-profit or public sectors or include additional disclosures that address domestic, regulatory or other issues. In developing requirements for public sector entities, the AASB considers the requirements of International Public Sector Accounting Standards (IPSASs), as issued by the International Public Sector Accounting Standards Board (IPSASB) of the International Federation of Accountants.
Private sector for-profit entities complying with Australian Accounting Standards will simultaneously comply with IFRSs. Many other entities complying with Australian Accounting Standards will also simultaneously comply with IFRSs.
Reasons for Issuing AASB 1048
Australian Accounting Standards that apply to annual reporting periods beginning on or after 1 January 2005 include Australian equivalents to International Financial Reporting Standards (IFRSs). IFRSs comprise Accounting Standards and Interpretations. IFRSs are issued by the International Accounting Standards Board (IASB), and their adoption in Australia is in accordance with a strategic direction made by the Financial Reporting Council (FRC).
This Standard clarifies that all Australian Interpretations have the same authoritative status. Those that are equivalent to the IASB Interpretations must be applied to achieve compliance with IFRSs. Australian Interpretations issued by the AASB comprise both AASB and UIG Interpretations. UIG Interpretations were developed by the Urgent Issues Group, a former committee of the AASB.
Need for a Service Standard
In the Australian context, Australian Interpretations do not have the same legal status as Standards (delegated legislation) and are treated as ‘external documents’ by the Acts Interpretation Act 1901 (and also by the Legislative Instruments Act 2003). Although references in one Standard to a second Standard are ambulatory (automatically moving forward to refer to the most recently-issued version of the second Standard), references in a Standard to external documents are stationary (being fixed in time to refer to the contents of the external document when the Standard was issued). A simple reference to an Australian Interpretation in an AASB Standard can only refer to the Interpretation that existed when the Standard was issued. It cannot refer to any revised version of the Interpretation that may exist at a later reporting date. However, an AASB Standard can refer to a second AASB Standard and, when the first Standard is applied at a later reporting date, the reference will be to the then-current version of the second Standard, even if it has been re-issued since the first Standard was issued.
The service Standard approach involves issuing an AASB Standard – this Standard – that lists the Australian Interpretations, and referring to that Standard in every other AASB Standard where necessary to refer to an Interpretation. This enables references to the Interpretations in all other AASB Standards to be updated by re-issuing the service Standard.
This approach preserves the status of Australian Interpretations as ‘external documents’ referred to in a Standard, with the contents fixed in time to that existing when the Standard takes effect. It does not treat the Interpretations as delegated legislation or confer ambulatory status on the reference. In each AASB Standard where there is a need to refer to an Australian equivalent of an IASB Interpretation, the reference will be to this Standard, phrased as “Interpretation [number] [title] identified in AASB 1048 as corresponding to IFRIC [or SIC] [number]”. This reference, being to another AASB Standard, is ambulatory and will refer to the Standard, AASB 1048, that is in force from time to time. AASB 1048 itself will contain the direct references to the external documents and will be re-issued to keep all references to Interpretations in the other Standards up to date.
This approach to clarifying the status of Australian Interpretations ensures there is no difference between the status in the hierarchy accorded to Interpretations in IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors compared with AASB 108 Accounting Policies, Changes in Accounting Estimates and Errors.
Main Features of this Standard
This Standard (issued in September 2008) supersedes the previous version of AASB 1048, issued in September 2007.
Application Date
This Standard is applicable to annual reporting periods ending on or after 30 September 2008 (see paragraph 3). To be consistent with the position for AASB Standards equivalent to IFRSs, early adoption of this Standard is not permitted for annual reporting periods beginning before 1 January 2005. However, early adoption is otherwise permitted as specified in paragraph 4, subject to paragraphs 10 and 12.
Main Requirements
This Standard identifies the Australian Interpretations and classifies them into two groups: those that correspond to an IASB Interpretation and those that do not. Entities are required to apply each relevant Australian Interpretation in preparing financial statements that are within the scope of the Standard.
In respect of the first group (Table 1), it is necessary for those Australian Interpretations, where relevant, to be applied in order for an entity to be able to make an explicit and unreserved statement of compliance with IFRSs. The IASB defines IFRSs to include the IFRIC and SIC Interpretations.
In the second group (Table 2), this Standard lists the other Australian Interpretations, that do not correspond to the IASB Interpretations, to assist financial statement preparers and users to identify the other authoritative pronouncements necessary for compliance in the Australian context.
The Standard will be re-issued when necessary to keep the Tables up to date.
Changes from AASB 1048 (September 2007)
The main differences between AASB 1048 (as issued in September 2007) and this version issued in September 2008 are the addition of five Interpretations based on IFRIC Interpretations to Table 1 in paragraph 9 of the Standard, and the addition of two Australian Interpretations that do not correspond to an IASB Interpretation to Table 2 in paragraph 11 of the Standard, as set out in the following table.
<table cellspacing="0" cellpadding="0" style="width:318.75pt; border-collapse:collapse"><thead><tr><td colspan="5" style="width:300.5pt; padding-right:5.75pt; padding-left:5.75pt; vertical-align:top"><h4 id="navPoint_12" style="margin-bottom:3pt"><span>Principal Additions</span><span> to Table 1</span></h4></td><td style="border-bottom:1.5pt double #000000; vertical-align:top"></td></tr><tr><td style="vertical-align:top"></td><td style="width:70.7pt; border-top:1.5pt double #000000; border-right:0.75pt solid #000000; border-bottom:1.5pt double #000000; padding:2.1pt 1.02pt 0.65pt 1.4pt; vertical-align:top"><p><span style="font-weight:bold">Interpretation</span></p><p><span style="font-size:9pt; font-style:italic">Issue Date</span></p></td><td style="width:117.2pt; border-top:1.5pt double #000000; border-right:0.75pt solid #000000; border-left:0.75pt solid #000000; border-bottom:1.5pt double #000000; padding:2.1pt 1.02pt 0.65pt; vertical-align:top"><p><span style="font-weight:bold">Title</span></p></td><td style="width:77.2pt; border-top:1.5pt double #000000; border-right:0.75pt solid #000000; border-left:0.75pt solid #000000; border-bottom:1.5pt double #000000; padding:2.1pt 1.02pt 0.65pt; vertical-align:top"><p><span style="font-weight:bold">Application Date </span><span>(annual reporting periods)</span></p></td><td colspan="2" style="width:38.2pt; border-top:1.5pt double #000000; border-left:0.75pt solid #000000; border-bottom:1.5pt double #000000; padding:2.1pt 1.4pt 0.65pt 1.02pt; vertical-align:top"><p><span style="font-weight:bold">IFRIC or SIC</span></p></td></tr></thead><tbody><tr><td style="vertical-align:top"></td><td style="width:70.7pt; border-top:0.75pt solid #000000; border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000; padding:2.48pt 1.02pt 1.02pt 1.4pt; vertical-align:top"><p><span>2</span></p><p><span style="font-style:italic">March</span><span style="font-style:italic"> 2008</span></p><p><span>[as amended to]</span></p></td><td style="width:117.2pt; border:0.75pt solid #000000; padding:2.48pt 1.02pt 1.02pt; vertical-align:top"><p><span>Members’ Shares in Co</span><span>‑</span><span>operative Entities and Similar Instruments</span></p></td><td style="width:77.2pt; border:0.75pt solid #000000; padding:2.48pt 1.02pt 1.02pt; vertical-align:top"><p><span>(beginning)</span></p><p><span>1 January 2009</span></p></td><td colspan="2" style="width:38.2pt; border-top:0.75pt solid #000000; border-left:0.75pt solid #000000; border-bottom:0.75pt solid #000000; padding:2.48pt 1.4pt 1.02pt 1.02pt; vertical-align:top"><p><span>IFRIC 2</span></p></td></tr><tr><td style="vertical-align:top"></td><td style="width:70.7pt; border-top:0.75pt solid #000000; border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000; padding:2.48pt 1.02pt 1.02pt 1.4pt; vertical-align:top"><p><span>9</span></p><p><span style="font-style:italic">March</span><span style="font-style:italic"> 2008</span></p><p><span>[as amended to]</span></p></td><td style="width:117.2pt; border:0.75pt solid #000000; padding:2.48pt 1.02pt 1.02pt; vertical-align:top"><p><span>Reassessment of Embedded Derivatives</span></p></td><td style="width:77.2pt; border:0.75pt solid #000000; padding:2.48pt 1.02pt 1.02pt; vertical-align:top"><p><span>(beginning)</span></p><p><span>1 July 2009</span></p></td><td colspan="2" style="width:38.2pt; border-top:0.75pt solid #000000; border-left:0.75pt solid #000000; border-bottom:0.75pt solid #000000; padding:2.48pt 1.4pt 1.02pt 1.02pt; vertical-align:top"><p><span>IFRIC 9</span></p></td></tr><tr><td style="vertical-align:top"></td><td style="width:70.7pt; border-top:0.75pt solid #000000; border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000; padding:2.48pt 1.02pt 1.02pt 1.4pt; vertical-align:top"><p><span>107</span></p><p><span style="font-style:italic">March</span><span style="font-style:italic"> 2008</span></p><p><span>[as amended to]</span></p></td><td style="width:117.2pt; border:0.75pt solid #000000; padding:2.48pt 1.02pt 1.02pt; vertical-align:top"><p><span>Introduction of the Euro</span></p><p><span></span></p></td><td style="width:77.2pt; border:0.75pt solid #000000; padding:2.48pt 1.02pt 1.02pt; vertical-align:top"><p><span>(beginning)</span></p><p><span>1 July 2009</span></p></td><td colspan="2" style="width:38.2pt; border-top:0.75pt solid #000000; border-left:0.75pt solid #000000; border-bottom:0.75pt solid #000000; padding:2.48pt 1.4pt 1.02pt 1.02pt; vertical-align:top"><p><span>SIC-7</span></p></td></tr><tr><td style="vertical-align:top"></td><td style="width:70.7pt; border-top:0.75pt solid #000000; border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000; padding:2.48pt 1.02pt 1.02pt 1.4pt; vertical-align:top"><p><span>15</span></p><p><span style="font-style:italic">August 2008</span></p></td><td style="width:117.2pt; border:0.75pt solid #000000; padding:2.48pt 1.02pt 1.02pt; vertical-align:top"><p><span>Agreements for the Construction of Real Estate</span></p></td><td style="width:77.2pt; border:0.75pt solid #000000; padding:2.48pt 1.02pt 1.02pt; vertical-align:top"><p><span>(beginning)</span></p><p><span>1 January 2009</span></p></td><td colspan="2" style="width:38.2pt; border-top:0.75pt solid #000000; border-left:0.75pt solid #000000; border-bottom:0.75pt solid #000000; padding:2.48pt 1.4pt 1.02pt 1.02pt; vertical-align:top"><p><span>IFRIC 15</span></p></td></tr><tr><td style="vertical-align:top"></td><td style="width:70.7pt; border-top:0.75pt solid #000000; border-right:0.75pt solid #000000; border-bottom:1.5pt double #000000; padding:2.48pt 1.02pt 0.65pt 1.4pt; vertical-align:top"><p><span>16</span></p><p><span style="font-style:italic">August 2008</span></p></td><td style="width:117.2pt; border-top:0.75pt solid #000000; border-right:0.75pt solid #000000; border-left:0.75pt solid #000000; border-bottom:1.5pt double #000000; padding:2.48pt 1.02pt 0.65pt; vertical-align:top"><p><span>Hedges of a Net Investment in a Foreign Operation</span></p></td><td style="width:77.2pt; border-top:0.75pt solid #000000; border-right:0.75pt solid #000000; border-left:0.75pt solid #000000; border-bottom:1.5pt double #000000; padding:2.48pt 1.02pt 0.65pt; vertical-align:top"><p><span>(beginning)</span></p><p><span>1 October 2008</span></p></td><td colspan="2" style="width:38.2pt; border-top:0.75pt solid #000000; border-left:0.75pt solid #000000; border-bottom:1.5pt double #000000; padding:2.48pt 1.4pt 0.65pt 1.02pt; vertical-align:top"><p><span>IFRIC 16</span></p></td></tr></tbody><tbody><tr style="height:0pt"><td style="width:4.25pt"></td><td style="width:73.5pt"></td><td style="width:120pt"></td><td style="width:80pt"></td><td style="width:34.25pt"></td><td style="width:6.75pt"></td></tr></tbody></table>
<table cellspacing="0" cellpadding="0" style="width:317.75pt; border-collapse:collapse"><thead><tr><td colspan="4" style="width:300.5pt; padding-right:5.75pt; padding-left:5.75pt; vertical-align:top"><h4 id="navPoint_13" style="margin-bottom:3pt"><span>Principal </span><span>Additions</span><span> to Table 2</span></h4></td><td style="border-bottom:1.5pt double #000000; vertical-align:top"></td></tr><tr><td style="vertical-align:top"></td><td style="width:69.2pt; border-top:1.5pt double #000000; border-right:0.75pt solid #000000; border-bottom:1.5pt double #000000; padding:2.1pt 1.02pt 0.65pt 1.4pt; vertical-align:top"><p><span style="font-weight:bold">Interpretation</span></p><p><span style="font-size:9pt; font-style:italic">Issue Date</span></p></td><td style="width:117.2pt; border-top:1.5pt double #000000; border-right:0.75pt solid #000000; border-left:0.75pt solid #000000; border-bottom:1.5pt double #000000; padding:2.1pt 1.02pt 0.65pt; vertical-align:top"><p><span style="font-weight:bold">Title</span></p></td><td colspan="2" style="width:117.2pt; border-top:1.5pt double #000000; border-left:0.75pt solid #000000; border-bottom:1.5pt double #000000; padding:2.1pt 1.4pt 0.65pt 1.02pt; vertical-align:top"><p><span style="font-weight:bold">Application Date</span></p><p><span>(annual reporting periods)</span></p></td></tr></thead><tbody><tr><td style="vertical-align:top"></td><td style="width:69.2pt; border-top:0.75pt solid #000000; border-right:0.75pt solid #000000; border-bottom:0.75pt solid #000000; padding:2.48pt 1.02pt 1.02pt 1.4pt; vertical-align:top"><p><span>1003</span></p><p><span style="font-style:italic">November 2007</span></p></td><td style="width:117.2pt; border:0.75pt solid #000000; padding:2.48pt 1.02pt 1.02pt; vertical-align:top"><p><span>Australian Petroleum Resource Rent Tax</span></p></td><td colspan="2" style="width:117.2pt; border-top:0.75pt solid #000000; border-left:0.75pt solid #000000; border-bottom:0.75pt solid #000000; padding:2.48pt 1.4pt 1.02pt 1.02pt; vertical-align:top"><p><span>(ending)</span></p><p><span>30 June 2008</span></p></td></tr><tr><td style="vertical-align:top"></td><td style="width:69.2pt; border-top:0.75pt solid #000000; border-right:0.75pt solid #000000; border-bottom:1.5pt double #000000; padding:2.48pt 1.02pt 0.65pt 1.4pt; vertical-align:top"><p><span>1038</span></p><p><span style="font-style:italic">December 2007</span></p><p><span style="font-size:11pt"></span></p></td><td style="width:117.2pt; border-top:0.75pt solid #000000; border-right:0.75pt solid #000000; border-left:0.75pt solid #000000; border-bottom:1.5pt double #000000; padding:2.48pt 1.02pt 0.65pt; vertical-align:top"><p><span>Contributions by Owners Made to Wholly-Owned Public Sector Entities</span></p></td><td colspan="2" style="width:117.2pt; border-top:0.75pt solid #000000; border-left:0.75pt solid #000000; border-bottom:1.5pt double #000000; padding:2.48pt 1.4pt 0.65pt 1.02pt; vertical-align:top"><p><span>(beginning)</span></p><p><span>1 July 2008</span></p></td></tr></tbody><tbody><tr style="height:0pt"><td style="width:5.75pt"></td><td style="width:72pt"></td><td style="width:120pt"></td><td style="width:114.25pt"></td><td style="width:5.75pt"></td></tr></tbody></table>
In addition to the above, as a consequence of the making of AASB 2007-8 Amendments to Australian Accounting Standards arising from AASB 101 (September 2007) and AASB 2007-10 Further Amendments to Australian Accounting Standards arising from AASB 101 (December 2007), editorial changes have been made to nearly all the Interpretations. The amended Interpretations are also included in Tables 1 and 2 of the Standard.