The Standard operates through a small set of tightly defined concepts that determine coverage, content and measurement of the additional disclosures.

Supplier finance arrangements: Paragraph 119A defines the concept. They are arrangements where one or more finance providers offer to pay amounts an entity owes its suppliers and the entity agrees to pay according to the arrangement’s terms at the same date or a later date than suppliers are paid (para 119A). The defining feature is that the arrangement gives the entity extended payment terms, or gives suppliers early payment compared with the original invoice due date. The Standard provides common alternative labels , supply chain finance, payables finance or reverse factoring , and sets out explicit exclusions: arrangements solely providing credit enhancements for the entity (for example, guarantees or letters of credit), and instruments used by the entity to settle directly with a supplier (for example, credit cards) are not supplier finance arrangements (para 119A).

Aggregate and disaggregated disclosure: Paragraph 119B requires aggregate disclosures for supplier finance arrangements, except where arrangements have dissimilar terms and conditions , those must be disclosed separately (para 119B(a)). The Standard requires information both at the beginning and end of the reporting period in specified categories (para 119B(b)), making the disclosure partly comparative.

Carrying amounts linked to statement of financial position line items: The Standard insists on presenting carrying amounts alongside the associated line items in the statement of financial position (para 119B(b)(i)-(ii)). That forces entities to map supplier finance liabilities to the balance sheet presentation used in their financial statements, reducing scope for obscuring amounts across generic liability captions.

Supplier payments already made by finance providers: Paragraph 119B(b)(ii) requires entities to disclose the carrying amounts of arrangement‑related financial liabilities for which suppliers have already received payment from finance providers. That is a distinct sub‑classification within the arrangement liabilities.

Range of payment due dates and comparability: Paragraph 119B(b)(iii) demands ranges of payment due dates for both arrangement liabilities and comparable trade payables that are not part of supplier finance arrangements. Comparability is defined in an examples sense (for instance, trade payables within the same line of business or jurisdiction as the arrangement liabilities). If ranges are wide, entities must add explanatory information or additional stratified ranges (para 119B(b)(iii)). This requires entities to assemble payment timing data and to construct comparable cohorts of payables.

Non‑cash changes: Paragraph 119B(c) requires disclosure of the type and effect of non‑cash changes in carrying amounts of the liabilities disclosed under (b)(i). Examples in the Standard include effects of business combinations and exchange differences (para 119B(c) and cross‑reference to para 86).

Materiality and transition: The Basis for Conclusions records that the Board expects the disclosures are required only where material to the entity (BC14). Paragraph 119C provides transition relief that removes the need to provide comparative information for reporting periods before the beginning of the annual reporting period in which the entity first applies the requirements, and exempts certain beginning‑of‑period items from the start‑point disclosure obligations (para 119C).

Interplay with existing standards: The Standard is an addendum to AASB 1060 and is designed to bring Tier 2 disclosures into alignment with amendments made by AASB 2023‑1 to AASB 107 and AASB 7 for Tier 1 entities, reflecting IASB changes to IAS 7 and IFRS 7 (BC2-BC4). The Standard refers to AASB 1057 for application mechanics (para 3).

In short, the main conceptual thrust is disclosure of contractual terms, balance‑sheet quantification and payment‑timing information for supplier finance arrangements, with transitional relief and a materiality gateway.

Primary population: Tier 2 entities that prepare general purpose financial statements under AASB 1060. The Standard amends AASB 1060 directly and therefore only applies to entities and financial statements in accordance with the application of AASB 1060 set out in AASB 1057 (para 3). The instrument does not itself define “Tier 2” , that definition is contained in the Tier classification framework and in AASB 1060 , but the target is clearly Tier 2 preparers rather than Tier 1 preparers (see the Preface and para 1).

Finance providers and suppliers: While the instrument imposes duties on Tier 2 reporting entities, the disclosure requirements will affect finance providers and suppliers economically and commercially. Suppliers whose receivables are paid by finance providers will be identifiable in an entity’s disclosures (para 119B(b)(ii)). Finance providers may therefore see increased transparency in their counterparties’ financial reports, which could influence counterparty risk assessments and pricing. The Standard itself does not regulate finance providers or suppliers; it requires reporting entities to disclose arrangements and amounts.

Users of financial statements: Primary beneficiaries, per the Board’s stated objective, are users who need information to assess an entity’s liabilities, cash flows and exposure to liquidity risk (paras 1-2; BC3). These users include creditors, analysts and other stakeholders relying on Tier 2 financial statements.

Auditors and preparers: Audit firms, accountants and in‑house finance teams preparing Tier 2 financial statements must implement policies and controls to identify supplier finance arrangements and compile the required disclosures. The Standard requires mapping arrangement liabilities to statement of financial position line items and calculation of ranges and non‑cash changes (para 119B).

Regulators and enforcers: The Standard is a legislative instrument made under s334 of the Corporations Act 2001 (cover). Enforcement is not set out in the Standard; regulators that oversee financial reporting (for example, ASIC) will apply their usual powers and regimes in relation to compliance with accounting standards under the Corporations Act. The Standard itself does not specify sanctions (the text contains no penalty provisions).

Small suppliers and SMEs: Although the Standard targets Tier 2 reporting entities, the information disclosed may affect supplier behaviour and negotiating dynamics. Disclosures showing that a Tier 2 entity uses supplier finance arrangements to obtain extended payment terms or to enable early payment to suppliers could affect suppliers’ bargaining positions, credit decisions and perceptions of the entity’s liquidity. The Standard does not mandate direct action by suppliers; it changes the information environment.

Public policy actors: The AASB’s Basis for Conclusions reveals public policy interest: the Board considered whether the disclosures address matters of public policy, are of particular relevance to the Australian environment, or reduce ambiguity between full IFRS and IFRS for SMEs (BC9-BC13). The Board relied on user feedback in Australia to justify extending the Tier 1 disclosures to Tier 2 (BC10-BC13).

In short, the immediate legal duty falls on Tier 2 entities preparing financial statements under AASB 1060, with downstream effects on suppliers, finance providers, auditors, creditors and other users of those financial statements.

Key duties imposed by the Standard are specific disclosure obligations inserted into AASB 1060.

Duty to identify supplier finance arrangements and scope exclusions: Entities must decide whether arrangements meet the definition in paragraph 119A and exclude arrangements that fall outside (for example, sole credit enhancements or direct settlement instruments) (para 119A). This is a substantive identification duty because the subsequent disclosure duties hinge on the classification.

Duty to disclose terms and conditions: Where supplier finance arrangements exist, the entity must disclose, in aggregate, their terms and conditions, for example extended payment terms and any security or guarantees provided. If arrangements have dissimilar terms and conditions, those must be disclosed separately (para 119B(a)). This creates a requirement to maintain contract summaries and to describe security or guarantees.

Duty to disclose carrying amounts and related line items: As at the beginning and end of the reporting period, entities must disclose (i) the carrying amounts and associated statement of financial position line items of financial liabilities that are part of the arrangements; and (ii) the carrying amounts and associated line items of those liabilities for which suppliers have already been paid by the finance providers (para 119B(b)(i)-(ii)). Entities therefore must map arrangement‑related liabilities to balance sheet captions and track which liabilities correspond to third‑party payments to suppliers.

Duty to disclose ranges of payment due dates and comparators: Entities must disclose the range of payment due dates for both the arrangement liabilities and comparable trade payables not part of the arrangement (para 119B(b)(iii)). If payment due date ranges are wide, explanatory information or stratified ranges are required. Entities must identify an appropriate comparator population (for example, same line of business or jurisdiction).

Duty to disclose non‑cash changes: Entities must disclose the type and effect of non‑cash changes (for example, business combinations, exchange differences) in the carrying amounts of the arrangement liabilities (para 119B(c) and cross‑ref to para 86).

Duty to consider materiality and transitional relief: The Board expects disclosures to be required only where material (BC14). The Standard provides transition relief in paragraph 119C, relieving entities from presenting certain comparative information for periods prior to the first application and from some beginning‑of‑period disclosures in the first year of application (para 119C; BC18-BC19).

Rights and discretion: The Standard gives entities limited discretion in several areas:

• Aggregation vs separation: Entities can aggregate disclosures, but must separate where terms are dissimilar (para 119B(a)). That requires judgement about when terms are “dissimilar”.

• Materiality judgement: The Board records that disclosures are required only where material (BC14). Entities retain the standard‑level judgement on materiality under AASB 1060 and general accounting principles.

• Comparator selection: The standard uses an examples‑based definition of “comparable trade payables” (para 119B(b)(iii)). Entities must exercise judgement to select appropriate comparable payables (for example, same line of business or jurisdiction).

• Treatment of wide ranges: If ranges of payment due dates are wide, entities can either explain those ranges or provide additional stratified ranges, allowing judgement in presentation (para 119B(b)(iii)).

Limitations and non‑delegation: The Standard itself does not create compliance enforcement mechanisms or penalties. It is part of the accounting standards framework and therefore operates within the regulatory ecosystem that enforces compliance with accounting standards under the Corporations Act. The Standard prescribes what must be disclosed but does not specify remedial steps or penalties within its text.

In short, entities must identify supplier finance arrangements, disclose terms, quantify related liabilities and payment timing information, report certain non‑cash changes, and apply materiality and transition relief where relevant, exercising judgement within those parameters.

The Standard itself contains no penalty clauses, fines, or criminal sanctions; it is a legislative instrument amending AASB 1060 (cover and para 5) and does not include enforcement provisions. The text does not specify sanctions for non‑compliance. Practitioners should therefore note two points evident from the instrument and its placement in the Australian reporting framework.

First, the Standard is made under section 334 of the Corporations Act 2001 (cover page). That placement means the Standard becomes part of the Australian accounting standards framework that entities must follow under the Corporations Act and related legislation and regulators. The Standard does not restate enforcement avenues, but compliance and enforcement consequences generally arise from the Corporations Act regime, including statutory obligations to prepare financial reports that comply with accounting standards. The instrument itself does not specify how those general enforcement powers will be exercised in relation to these specific disclosure requirements.

Second, the Standard prescribes disclosure content and transition relief but leaves materiality judgements and some presentation choices to preparers (BC14; para 119B). Enforcement attention is likely to focus on whether entities have complied with the specific disclosure items, applied the definition of supplier finance arrangements appropriately (para 119A), and respected the transitional relief in paragraph 119C. The Basis for Conclusions records that the Board expects disclosures to be made only where material (BC14), which may be relevant in any regulatory assessment of compliance.

Because the Standard does not itself create or describe penalties, users and advisers must consult the Corporations Act and regulator guidance for enforcement mechanics and potential sanctions for materially non‑compliant financial reports. The Standard’s absence of penalty language is therefore a feature: it prescribes disclosure duties but depends on the existing statutory and regulatory compliance framework for enforcement.

Finally, auditors will play a de facto enforcement role in practice through audit opinions. The Standard imposes disclosure requirements that auditors must consider in forming an opinion on whether financial reports comply with accounting standards. The instrument does not describe auditing consequences; the auditing standard‑setting and regulatory framework will determine auditor responsibilities and potential findings.

This Standard is part of the Australian accounting standards ecosystem and interacts with other accounting instruments, international amendments and statutory application mechanisms described in the text.

Relationship with AASB 1060 and AASB 1057: The Standard directly amends AASB 1060 (para 5). Paragraph 3 requires that the amendments apply to entities and financial statements in accordance with the application of AASB 1060 as set out in AASB 1057 Application of Australian Accounting Standards. AASB 1057 governs the application of Australian accounting standards, including ordering and precedence matters. Therefore this instrument must be read in conjunction with AASB 1060 and AASB 1057 to determine which entities are within scope and how to apply the amendments.

Alignment with AASB 2023‑1, AASB 107 and AASB 7: The Standard’s content mirrors the supplier finance disclosure requirements that AASB 2023‑1 introduced for Tier 1 entities by amending AASB 107 Statement of Cash Flows and AASB 7 Financial Instruments: Disclosures (BC2-BC3). The Tier 2 amendments are intended to require the same specific disclosures that AASB 2023‑1 requires in the financial statements of Tier 1 entities (Preface Main features; BC13). Practitioners should therefore read these amendments alongside AASB 2023‑1, AASB 107 and AASB 7 to ensure consistent application across Tier structures.

International accounting standards: The Basis for Conclusions notes that the Tier 1 disclosure amendments arose from the IASB’s International Financial Reporting Standard Supplier Finance Arrangements (Amendments to IAS 7 and IFRS 7) issued May 2023 (BC4). The AASB followed the international amendments in tailoring the Australian Tier 2 standard to align with IASB thinking. The Board also considered how the IASB’s proposals for the IFRS for SMEs Accounting Standard and the Subsidiaries without Public Accountability: Disclosures project would interact with AASB 1060 (BC16-BC19). The AASB has included some transition relief (para 119C) even though the IASB did not in the IFRS for SMEs proposals, because of a shorter implementation timeframe in Australia (BC18-BC19).

Corporations Act and statutory reporting obligations: The Standard is made under s334 of the Corporations Act 2001 (cover). That legislative locus means the Standard becomes part of the Australian statutory framework that underpins financial reporting obligations for entities subject to the Corporations Act. The Standard does not itself specify enforcement provisions; those remain in the Corporations Act and regulator practice.

Interaction with other disclosure and financial reporting regimes: The Standard’s disclosure requirements (for example, mapping carrying amounts to balance sheet line items and disclosing payment due date ranges) will interact practically with an entity’s existing requirements under AASB 1060 to disclose liquidity and solvency information, measurement uncertainties, accounting policy choices and disaggregation of amounts (BC12). Entities should ensure consistent presentation and avoid duplication or contradiction between existing required disclosures and the new supplier finance disclosures.

No conflict resolution text: The Standard does not include explicit conflict resolution provisions about precedence between Australian and international guidance. The Board’s Basis for Conclusions indicates the amendments are consistent with international changes and that the Board intends to monitor IASB developments (BC18). Practitioners should therefore follow the Standard in conjunction with AASB 1060, AASB 1057 and the international standards it references.

In summary, the Standard is not a stand‑alone instrument; it must be read and implemented in the context of AASB 1060, AASB 1057, AASB 2023‑1, AASB 7, AASB 107, IASB amendments to IAS 7 and IFRS 7, and the statutory reporting framework under the Corporations Act.

This instrument is the AASB’s AASB 2024‑1 Amendments to Australian Accounting Standards , Supplier Finance Arrangements: Tier 2 Disclosures. Key milestones and textual changes evident in the instrument and its Basis for Conclusions are as follows.

Predecessor standards and basis: AASB 1060 (March 2020) is the Tier 2 standard amended by AASB 2024‑1 (Preface; para 5). AASB 2023‑1 (June 2023) introduced supplier finance disclosures into Tier 1 reporting by amending AASB 107 and AASB 7 (Preface Main features; BC2).

Exposure draft and consultation: The Board exposed the proposals as Exposure Draft ED 328 Supplier Finance Arrangements: Tier 2 Disclosures in December 2023 and sought public comment (BC6). The Board received one formal comment letter (BC15), and after considering submissions and international developments proceeded with the amendments with minimal changes from ED 328 (BC14).

Adopted text: The Standard adds paragraphs 119A-119C and a related heading to AASB 1060 (para 5). Paragraph 119A defines supplier finance arrangements and scope exclusions. Paragraph 119B sets out the disclosure requirements (terms and conditions; carrying amounts and line items at beginning and end of period; carrying amounts for which suppliers have already been paid; ranges of payment due dates and comparators; and non‑cash changes). Paragraph 119C provides transition relief regarding comparative information (paras 119A-119C).

Timing and commencement: The Standard is dated 7 March 2024 and signed by the AASB Chair Keith Kendall (cover). It is stated to commence for legal purposes on 29 June 2024 (para 6). The accounting application covers annual periods beginning on or after 1 January 2024 that end on or after 30 June 2024, with earlier application permitted (para 4; BC20).

Relationship with IASB initiatives: The Board’s Basis for Conclusions explains the amendments reflect the IASB’s May 2023 amendments to IAS 7 and IFRS 7. It also discusses the IASB’s tentative approach to inclusion of supplier finance disclosures in the IFRS for SMEs Accounting Standard and the Subsidiaries without Public Accountability: Disclosures project, noting differences in transition relief between the IASB’s tentative approach and the AASB’s decision to include transition relief in AASB 1060 because of the shorter implementation window in Australia (BC16-BC19).

Transition relief detail: The transitional relief is set out in paragraph 119C. Specifically, entities are not required to disclose comparative information for any reporting periods presented before the beginning of the annual reporting period in which the entity first applies the requirements; and entities are not required to disclose the information otherwise required by paragraph 119B(b)(ii)-(iii) as at the beginning of the annual reporting period in which the entity first applies those requirements (para 119C; BC18-BC19).

Minimal changes from ED 328: The Board indicates that, following consultation, it proceeded with issuing this Standard with minimal changes from the exposure draft (BC14). The Board did, however, remove a disclosure objective proposed in ED 328 to align with IASB tentative approach and included transition relief in AASB 1060 where the IASB did not (BC16-BC19).

In summary, AASB 2024‑1 is a targeted, contemporaneous Australian response to the IASB and AASB Tier 1 changes on supplier finance, with defined scope, timelines and transition relief. The instrument’s history is short and directly linked to the global amendments made in 2023.

The text of AASB 2024‑1 and its Basis for Conclusions contain no litigation history or references to judicial decisions about the content, scope or application of these disclosure requirements. The Standard and its supporting documentation mention only policy development, exposure draft ED 328, stakeholder consultation and alignment with IASB amendments (BC6-BC20). No cases, enforcement actions, or disputes are cited in the instrument.

Practical implications of the absence of litigation history: The absence of cited litigation does not mean disputes cannot arise. The Standard introduces several points of judgement and potential interpretive ambiguity that could generate future disputes between preparers and auditors, or between regulators and entities, including:

• Classification: Whether a particular arrangement constitutes a supplier finance arrangement under paragraph 119A, particularly where arrangements have hybrid features (for example, some degree of credit enhancement plus early payment features). The Standard provides exclusion examples (para 119A) but does not provide an exhaustive set of classification tests.

• Aggregation and dissimilarity: The requirement to aggregate disclosures unless arrangements have dissimilar terms and conditions (para 119B(a)) requires judgement on what constitutes “dissimilar”, which could be contested in an audit or regulatory review.

• Comparable trade payables: Paragraph 119B(b)(iii) asks for ranges of payment due dates for arrangement liabilities and comparable trade payables not part of the arrangement, using examples for comparability (for example, same line of business or jurisdiction). Disputes could arise over whether an entity’s chosen comparators are appropriate.

• Range construction and stratification: Entities must provide stratified ranges or explanations where payment due date ranges are wide (para 119B(b)(iii)). How to stratify and what explanatory information suffices could be areas of contention.

• Carrying amounts and mapping to balance sheet line items: The requirement to present carrying amounts and associated line items could lead to disagreements about presentation and classification on the statement of financial position (para 119B(b)(i)-(ii)).

• Transitional disclosures: Paragraph 119C limits comparative obligations, but entities may still face disputes over whether they satisfied the initial‑period disclosure obligations appropriately.

Given these potential battlegrounds, practitioners should expect future audit or regulatory reviews that clarify the interpretation and application of the new paragraphs. Litigation, regulatory enforcement actions or audit resolutions could arise from disagreements in these areas, but none are recorded in the instrument at present.

This Standard contains a number of detail‑level traps and practical pitfalls that can catch preparers and auditors unprepared.

Classification pitfalls (para 119A): The definition of supplier finance arrangements turns on who pays suppliers and when the reporting entity repays the finance provider. Some arrangements have hybrid features, such as guarantees or credit enhancements combined with supply chain finance mechanics. The Standard expressly excludes arrangements that are solely credit enhancements and instruments used to settle directly with a supplier (for example, credit cards). Entities must document their classification decisions and keep contract evidence showing when finance providers make payments to suppliers and when the entity is obligated to pay the finance provider.

Aggregation versus separation (para 119B(a)): The Standard allows aggregated disclosure unless arrangements have dissimilar terms and conditions. Failure to identify materially dissimilar arrangements will lead to inadequate disclosure. Entities should pre‑define criteria for “dissimilar” (for example, materially different payment terms, security or guarantees) and document the analysis, because aggregation choices must be defensible.

Statement of financial position mapping (para 119B(b)(i)-(ii)): The requirement to disclose carrying amounts and the associated line items requires precise ledger mapping. Some entities might present supplier finance liabilities under general headings such as “trade and other payables” or “borrowings”. Preparers must map which line items include arrangement liabilities, and ensure consistency between beginning and end‑of‑period disclosures.

Identification of liabilities already paid to suppliers (para 119B(b)(ii)): Entities must disclose the carrying amounts of arrangement liabilities for which suppliers have already received payment from finance providers. This requires operational integration with finance providers’ statements and the entity’s accounts payable records. Failure to reconcile payments from finance providers to supplier payment status can lead to inaccurate disclosures.

Comparable trade payables selection and ranges (para 119B(b)(iii)): The obligation to present ranges of payment due dates for arrangement liabilities and comparable trade payables requires building comparable cohorts. The Standard gives examples for comparability (same line of business or jurisdiction), but does not prescribe precise rules. Wide ranges must be explained or stratified. Entities that fail to justify their comparators or to stratify wide ranges risk non‑compliance.

Non‑cash changes (para 119B(c)): Disclosing the type and effect of non‑cash changes in carrying amounts (for example, business combinations and exchange differences) requires entities to track movements separate from cash flows. Entities that do not maintain movement reconciliations for arrangement liabilities could struggle to provide accurate disclosures.

Materiality and documentation (BC14): The AASB expects disclosures to be made where material. However, materiality is a judgement. Conservative approaches may produce voluminous disclosures; aggressive approaches risk regulatory or audit critique. Documenting the materiality assessment, including thresholds and rationale, is therefore critical.

Transition relief nuances (para 119C): Paragraph 119C provides relief from some comparative disclosure obligations in the year of first application. Practitioners must apply the relief correctly: comparative information for periods before the beginning of the reporting period in which the entity first applies the requirements is not required. Also, the information otherwise required by paragraph 119B(b)(ii)-(iii) is not required as at the beginning of the annual reporting period in which the entity first applies the requirements. Misapplication of these reliefs could produce inconsistent comparative information.

Timing mismatch between legal commencement and accounting application (para 6 and para 4): The instrument legally commences on 29 June 2024 but applies to accounting periods beginning on or after 1 January 2024 that end on or after 30 June 2024. Entities should verify which reporting periods are affected and whether earlier application is appropriate.

Data and system readiness: The disclosures require granular data about payments, payment dates, payment by finance providers, contractual terms, and mapping to balance sheet line items. Entities without systems that capture finance provider payments separately from other payables will need process and system changes.

Dispute risk with suppliers and finance providers: Disclosures that reveal the extent of supplier finance usage or the carrying amounts paid by finance providers may change commercial dynamics with suppliers and finance providers. While the instrument does not regulate contractual relationships, disclosure could influence third‑party behaviour.

Interaction with audit procedures: Auditors will require corroborating evidence for the disclosures (for example, confirmations from finance providers, supplier statements, or reconciliations). Failure to maintain audit evidence may lead to modified audit opinions.

In short, the main gotchas are classification, aggregation choices, mapping to balance sheet items, comparable selection and stratification, non‑cash movement reconciliation, materiality documentation, proper use of transition relief and readiness of systems to produce the required outputs.

Practical steps for Tier 2 entities to comply with the new AASB 1060 paragraphs 119A-119C. The approach below is a compliance checklist grounded in the specific text of the Standard and the Basis for Conclusions.

1. Confirm applicability

• Determine whether the entity is a Tier 2 reporting entity preparing general purpose financial statements under AASB 1060 and apply AASB 1057 for application mechanics (para 3). If not a Tier 2 entity, the new paragraphs do not apply.

2. Inventory contracts and arrangements

• Run a contract review focused on supplier payment arrangements and financing structures. Identify arrangements where finance providers pay suppliers and the reporting entity agrees to pay the finance provider at the same date or later than suppliers are paid (para 119A). Exclude arrangements that are solely credit enhancements (for example, guarantees) or instruments used by the entity to settle directly with suppliers (for example, credit cards) as stated in para 119A.

3. Classify arrangements and document rationale

• For each arrangement, document whether it meets the supplier finance definition and why, with supporting evidence (payment flows, confirmation from finance providers, invoices). Maintain documentation for audit and regulatory inspection.

4. Determine aggregation strategy and dissimilar‑terms segmentation

• Apply para 119B(a): decide which arrangements can be aggregated and which must be disclosed separately because of dissimilar terms and conditions. Define objective criteria for dissimilarity (for example, material differences in term length, interest or fee charging, recourse vs non‑recourse, security or guarantees). Keep governance minutes that record the decision logic.

5. Prepare carrying‑amount reconciliations

• For each reporting period beginning and end (para 119B(b)(i)-(ii)), prepare reconciliations that show the carrying amounts of financial liabilities that are part of supplier finance arrangements and the associated statement of financial position line items. Also separately reconcile and quantify those arrangement liabilities for which suppliers have already received payment from finance providers (para 119B(b)(ii)). Maintain evidence such as finance provider confirmations and supplier statements.

6. Compute ranges of payment due dates and select comparators

• For both arrangement liabilities and comparable trade payables not part of supplier finance arrangements, compute the range of payment due dates (para 119B(b)(iii)). Define and document the comparator group (examples include same business line or jurisdiction). If ranges are wide, prepare stratified ranges or explanatory narrative as required by para 119B(b)(iii).

7. Track non‑cash changes

• Maintain a movement schedule for these liabilities that separately identifies cash flows and non‑cash changes (para 119B(c)). Non‑cash changes include business combinations, exchange differences and other non‑cash transactions (para 119B(c) and cross‑ref to para 86). Document the type and quantitative effect for disclosure.

8. Apply materiality and transition relief

• Apply materiality principles (BC14) to determine which disclosures are necessary. If first‑time applying the requirements, apply paragraph 119C transition relief: do not provide comparative information for reporting periods before the beginning of the annual reporting period in which the entity first applies the requirements; and do not provide the 119B(b)(ii)-(iii) information as at the beginning of the reporting period in which the entity first applies the requirements (para 119C).

9. Draft disclosures and cross‑check presentation

• Draft disclosure text and tables consistent with paragraph 119B(a)-(c). Ensure carrying amounts are mapped to the associated statement of financial position line items used in the financial statements (para 119B(b)(i)-(ii)). Cross‑check that the disclosures are consistent with other liquidity and cash flow disclosures in the financial statements and with any Tier 1 disclosures in AASB 107/AASB 7 if the entity voluntarily references those.

10. Audit readiness and evidence collation

• Collate supporting documentation for auditors: contracts, finance provider confirmations, supplier confirmations, payment remittance advices, reconciliations demonstrating carrying amounts and non‑cash movements, and rationale for comparators and stratification. Prepare working papers showing materiality assessments and decisions on aggregation.

11. Governance and controls

• Establish or update internal controls to capture and report supplier finance data: contract intake controls, accounts payable workflows that record payments made by finance providers, ledgers that tag arrangement liabilities separately, and reporting extracts that produce the required carrying amounts and payment date ranges.

12. Consider stakeholder and commercial effects

• Consider whether the disclosures could affect suppliers, finance providers or creditors and whether any additional commercial communications are warranted to explain the disclosures in context. Although the Standard does not require additional stakeholder communication, material disclosures of supplier finance use could prompt supplier or lender enquiries.

13. Timetable and earlier application

• Note the application timetable: annual periods beginning on or after 1 January 2024 that end on or after 30 June 2024 (para 4). Earlier application is permitted. Where earlier application is chosen, ensure disclosures are prepared for the earlier comparative periods in line with paragraph 119C.

14. Monitor IASB and AASB guidance

• The AASB notes it will monitor IASB developments on supplier finance disclosures in the IFRS for SMEs and Subsidiaries without Public Accountability projects (BC18). Practitioners should monitor for future clarifications or alignment requirements.

Implementing these steps will require coordination between accounting, treasury, procurement and IT. The most likely operational cost centres are systems changes to tag and report finance provider payments, contract review resources, audit evidence collation and governance records. The Standard provides clear disclosure items (paras 119A-119C), so compliance is a matter of assembling and presenting the specified data and documenting judgements on aggregation, comparators and materiality.