AASB Accounting Standard Updates

This solved assignment focuses on alterations made to Australian Accounting Standards Board (AASB) pronouncements between May 1st, 2017, and August 4th, 2017. It examines updates such as the AASB Framework for tax transparency, insurance contracts, property, plant, and equipment, public-private partnerships, organizational reporting on tax liabilities, and the closure of outdated AAS accounting standards. The assignment provides insights into how these changes impact financial reporting practices.

Running Head: FINANCIAL ACCOUNTING
Financial Accounting
Name of the Student:
Name of the University:
Author’s Note:

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FINANCIAL ACCOUNTING
Answer to Question 1:
ALTERATIONS THAT INDICATE THE ACCOUNTING STANDAD
THROUGH AASB FROM 1ST MAY 2017 TO 4T H AUGUST 2017
AUSTRALIAN
AASB FRAMEWORK
FOR TAX
TRANSPARENCY
(16-05-17)
The stakeholders of
Australia along with
international investors
consider viewing
reliable and highly
compatible tax reporting
regarding tax position
of companies. This
guidance facilitates the
companies in explaining
tax based information,
that remains consistent
with increasing
international disclosure
practices and
requirements of ASIC in
consideration to non-
GAAP. This requires
disclosure of certain
ETR relied on corporate
tax just to enable
comparison with tax rate
of the company. This
guidance maintains the
needed disclosures in
order to make sure that
the associated parties
might realise the
differences among ETR
within code prepared in
compliance and certain
accounting standards.
INSURANCE
CONTRACTS (18-05-
2017)
The Australian insurance
analysts might attain great
advantages from
improved international
comparability provided
through IFRS 17
contracts issued in
accordance with IASB.
As per these contracts, the
international insurers
might not be facilitated to
employ historical cost
within annual reports. In
accordance with such
contracts, opportunities
are decreased in order to
gain profitable and
unprofitable business in a
particular portfolio that
leads to recognition of
losses at an early stage.
ED 280- PROPERTY,
PLANT AND
EQUIPMENT
This serves as a proposal
in making a lot of
amendments to “AASB
116- Property, Plant and
Equipment”. Based on
proposal, earnings
gathered from products
sold manufactured while
considering “property,
plant and equipment” to
condition along with
location which is
necessary for it to be able
to operate in ways that
might be totally from part
of management. For
example, the inventory
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FINANCIAL ACCOUNTING
produced in the duration
of testing, machinery
might be associated with
profit and loss and it will
not be deducted from
asset cost.
SUPERIOR
INFRASTRUCTURE
TRANSPARENCY
FOCUSSED ON
TAXPAYERS (20-07-
2017)
As per such development,
the public sector
companies might be
required to maintain
assets and liabilities
related with public-
private partnerships.
Additionally, such
projects must be indicated
within the balance sheet
statements of a company
that leads to increase in
total assets and liabilities.
This might support in
maintaining superior
accountability along with
effective management.
ORGANISATIONS
REQUIRES
REPORTING ON
TAX LIABILITIES
(04-07-2017)
Based on such
amendment, the directors
are required to assess in a
better manner the
aggressiveness related
with tax positions by
taking into account that
the tax authority has
enormous knowledge
regarding certain facts. In
addition, the tax liability
in accordance with certain
anticipated amount of
settlement must not be
mentioned within balance
sheet statement of a
company.
STRATEGY OF AASB
BOARD AND
BUSINESS PLAN
(28-07-16)
Such amendment was
maintained in accordance
with the “Auditing and
Assurance Standards
Board”. AASB has
maintained such strategy
over the years from 2017
to 2021. Certain
important people are
capable to explain this
standard within overall
strategy finalisation.
END OF A
PARTICULAR ERA
(29-07-17)
This amendment has
indicated the closure of
AAS accounting
standards, for reason that
“AASB 1056” considered
outdated “AAS 25
Financial Reporting” by
developing
superannuation plans
within the current
financial year.
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FINANCIAL ACCOUNTING
Answer to Question 2:
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FINANCIAL ACCOUNTING
Particulars Amount Amount
Current Assets:
Cash at Bank $18,200
Cash Management Account $150,000
Accounts Receivable $123,900
Allowance for Dobtful Debts ($14,600)
Interest Receivable $6,700
Total Inventory $312,900
Prepaid Rent $13,600
TOTAL CURRENT ASSETS $610,700
Non-Current Assets:
Investment Property $614,000
Loan Receivable $60,000
Land (at Cost) $1,100,000
Plant & Equipment, net $547,900
Goodwill $68,300
TOTAL NON-CURRENT ASSETS $2,390,200
TOTAL ASSETS $3,000,900
Current Liabilities:
Accounts Payable $75,800
Current Tax Liability $33,500
Accrued Wages Payable $8,200
Interest Payable $8,300
Dividends Payable $45,000
Provision for Annual Leave $19,000
Provision for Long Service Leave $8,000
Provision for Warranty $5,000
TOTAL CURRENT LIABILITIES $202,800
Non-Current Liabilities:
Debentures $600,000
Bank Loan $500,000
Provision for Annual Leave $17,000
Provision for Long Service Leave $19,000
Provision for Warranty $12,000
TOTAL NON-CURRENT LIABILITIES $1,148,000
TOTAL LIABILITIES $1,350,800
Equity:
Share Capital $500,000
General Reserve $276,800
Retained Earnings $873,300
TOTAL EQUITY $1,650,100
TOTAL LIABILITIES & EQUITY $3,000,900
In the books of Winter Ltd.
Balance Sheet
as on 30 June 2017
Workings:
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FINANCIAL ACCOUNTING
Total Inventory
Particulars Amount
Inventory $212,400
Add: Raw Materials $100,500
Total Inventory $312,900
Plant & Equipment,net
Particulars Amount
Plant & Equipment (at Cost) $652,200
Less: Accum. Depreciation $104,300
Plant & Equipment,net $547,900
Non-Current Prov. For Annual Leave
Particulars Amount
Provision for Annual Leave $36,000
Less: Current Portion of Provision $19,000
Non-Current Prov. For Annual Leave $17,000
Non-Current Prov. For Long Service Leave
Particulars Amount
Provision for Long Service Leave $27,000
Less: Current Portion of Provision $8,000
Non-Current Prov. For Long Service Leave $19,000
Non-Current Prov. For Warrant
Particulars Amount
Provision for Warranty $17,000
Less: Current Portion of Provision $5,000
Non-Current Prov. For Warrant $12,000
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