CTHIn ForceLegislation
Accounting Standard AASB 18 Presentation and Disclosure in Financial Statements
34AAn entity, other than those entities described in paragraph 34B, shall classify:
Start here
Get a plain-English read of 34A
Turn the raw legal text into a practical explanation grounded in Accounting Standard AASB 18 Presentation and Disclosure in Financial Statements.
34A An entity, other than those entities described in paragraph 34B, shall classify:
(a) interest paid (as described in paragraph 32) as cash flows from financing activities.
(b) interest and dividends received as cash flows from investing activities.
34B An entity that invests in assets or provides financing to customers as a main business activity (as determined applying paragraphs B30–B41 of AASB 18) shall determine how to classify dividends received, interest received and interest paid in the statement of cash flows by referring to how – applying AASB 18 – it classifies dividend income, interest income and interest expenses in the statement of profit or loss. An entity shall classify the total of each of these cash flows in a single category in the statement of cash flows (that is, either as operating, investing or financing activities).
34C In applying paragraph 34B, if an entity classifies the total of each of dividend income, interest income and interest expenses in a single category of the statement of profit or loss, the entity shall classify the total of each of dividends received, interest received and interest paid as cash flows arising from the associated activity in the statement of cash flows. For example, if an entity classifies all its interest expenses in the financing category of the statement of profit or loss, the entity would classify all its interest paid as cash flows from financing activities.
34D In applying AASB 18, an entity may be required to classify each of dividend income, interest income and interest expenses in more than one category of the statement of profit or loss. In such a case, in applying paragraph 34B the entity shall make an accounting policy choice to classify the related cash flows in one of the associated activities in the statement of cash flows. For example, if an entity classifies interest expenses in the operating category and the financing category of the statement of profit or loss, the entity would classify all its interest paid in accordance with its accounting policy as either cash flows from operating activities or cash flows from financing activities.
Taxes on income
35 Cash flows arising from taxes on income shall be separately presented disclosed and shall be classified as cash flows from operating activities unless they can be specifically identified with financing and investing activities.
...
Components of cash and cash equivalents
...
46 In view of the variety of cash management practices and banking arrangements around the world and in order to comply with AASB 108 Basis of Preparation of Financial StatementsAASB 101 Presentation of Financial Statements, an entity discloses the policy which it adopts in determining the composition of cash and cash equivalents.
47 The effect of any change in the policy for determining components of cash and cash equivalents, for example, a change in the classification of financial instruments previously considered to be part of an entity’s investment portfolio, is reported in accordance with AASB 108 Accounting Policies, Changes in Accounting Estimates and Errors.
...
...
64 AASB 18 issued in June 2024 amended paragraphs 6, 10, 12, 14, 16–18, 20, 31, 32, 35, 46 and 47, added paragraphs 33A and 34A–34D, and deleted paragraphs 33 and 34. An entity shall apply those amendments when it applies AASB 18.