Accounting policy assessment step 2: Disclosing whether or not the financial statements comply overall with all the recognition and measurement requirements in Australian Accounting Standards (except for requirements set out in AASB 10 or AASB 128) or that compliance has not been assessed
IG9 Based on the assessment in paragraph 9A(c), paragraph 9A(d) then requires an entity to disclose whether or not overall the material accounting policies applied and disclosed in the financial statements comply (that is there are no instances of non-compliance or non-assessment) (see Examples 1, 2 and 3 below) or do not comply (there are one or more instances of non-compliance) with all the recognition and measurement requirements in Australian Accounting Standards (except for requirements set out in AASB 10 or AASB 128) (see Examples 4, 5 and 6 below), or that an assessment has not been made (there are one or more instances of compliance / non-compliance not having been assessed) (see Examples 6 and 7 below).
IG10 Based on the AASB’s research, some of the most frequent examples of non-compliance with recognition and measurement requirements in Australian Accounting Standards include:
(a) in accounting for income, recognition of grant income for a specified time period, or which has no conditions that need to be met, is deferred until the related expenses are incurred, or all grant income is deferred, without assessing whether a performance obligation exists, which does not comply with AASB 15 Revenue from Contracts with Customers or AASB 1058 Income of Not-for-Profit Entities;
(b) in accounting for property, plant and equipment, assets were not depreciated based on their useful lives, which does not comply with AASB 116 Property, Plant and Equipment;
(c) in accounting for impairments, the recoverable amount for impairment testing was calculated on an undiscounted basis, which does not comply with AASB 136 Impairment of Assets; and
(d) in accounting for employee benefits, the long\-term provision for long service leave is not recognised, or not discounted, which does not comply with AASB 119 Employee Benefits.