FINANCIAL ACCOUNTING2Answer 1:Recent developments in financial reporting:Global entities:The year 2017 marks the first year in which the significant global entities would prepare thegeneral purpose financial statements and also submit the same to the Australian Taxationoffice. These financial statements prepared must correspond to the income year and must behanded over to the Commissioner by the time he company is able to lodge its tax return.Superannuation entities:The superannuation investments in the country of Australia totals to about $2 trillion. And itis for this reason that the members of the superannuation funds must have an access to theinformation which is easy to understand when it comes to the overall performance. From thisyear, the financial statements of the superannuation funds would show in the benefits that themembers are entitled to and also, whether this fund is likely to be able to pay in the benefits.These new requirements replaces the AAS 25 which relates with the financial reporting bythe superannuation plans. These apply to the larger superannuation companies which areregulated by the Australian Prudential Regulation authority and also to the superannuationentities of the public sectors. These new requirements fails to apply to the self-managedsuperannuation funds and also results in some of the significant changes in the presentation,measurement and also to the disclosure requirements. When it comes to the initialapplication, these entities are not required to present the statement of financial position (EY,2017).The next steps would include in the facts for the entities that have not yet adopted the ASC606. The effective date for the same would be aligned in with ASC 606. In respect of thebusiness entities that are already following it, the same is effective for the fiscal years which
FINANCIAL ACCOUNTING3begins after December 15, 2017. This includes the interim period within the stated fiscal year.As for the other companies, the effective data is after the fiscal year December 15, 2018 andalso the interim periods within the fiscal years which begins on or after December 15, 2019.Share-Based Payment:The FAS issued ASU 2017-09 which deals with the amendment in the scope of themodification accounting for the arrangements pertaining to the share based payments. Itprovides insight into the terms and the conditions of the wards of the share based paymentsthat would be required for the application of the modification accounting under the ASC 718.An entity would not apply the modification in case, the fair value, vesting conditions,classification of the wards are somewhat same as were before and after the modification tookplace. The following is the link for the same:http://www.fasb.org/jsp/FASB/Document_C/DocumentPage?cid=1176169021134&acceptedDisclaimer=trueIASB Issues New Insurance Contracts Standard:IASB released the IFRS 17 which deals with the principles for the recognition, measurement,presentation and the insurance contract disclosures. The main aim of this standard is thereduction of the diversity in practice which rose due to the IFRS 4. This standard allowed thecompany to carry on the accounting for the insurance contracts by the way of using thenational accounting standards which results in many of the different approaches.The development would be lead to an increased comparability by the way of requiring in allof the insurance contracts to be accounted for in a consistent manner.
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