ACCG224: AASB 16 Leases Impact on Myer's Financial Reporting

This report provides an analysis of the impact of AASB 16 Leases on Myer's financial reporting, as part of the ACCG224 Financial Accounting and Reporting course. It summarizes the provisions of AASB 16, examines the potential impacts on the company's financial position and performance due to the non-renewal of leases, and offers recommendations for effective application of the standard. The report highlights the recognition of a right-of-use asset and lease liability on the balance sheet, the material impact on the consolidated financial statement, and the resulting front-loaded expenditure pattern. Recommended actions include considering a cross-functional approach, introducing changes, ensuring compliance with applicable standards, and adhering to qualitative characteristics.

Management
accounting
Task 2

Table of Contents
• Introduction
• Description of leases
• Potential impact on financial position
and performance
• Improvisation in financial reporting
through AASB 16
• Recommendations

Introduction
• Presentation summaries the provisions of
AASB 116
• Analysis of the potential impacts on the
company’s financial position and
performance is done by the application of
the new rules introduced in AASB 116.
• Recommendations will be provided to the
companies for the application of standards in
an effective manner.

A summary of the new rules
according to AASB 16/IFRS 16
• AASB 16 leases was published on
February in the year 2016 and will is
effective for initial period or after the 1
January 2019.
• For the lessees having operating leases,
a ROU will taken to the balance sheet
along with the lease
liability(Joubert,Garvie and Parle, 2017).

An analysis of the potential impacts on
the company’s financial position and
performance
• Non renewal of leases at Hornsby, Belconnen
and Colonnades
• A material impact on the consolidated financial
statement of company
• Resulting in recognition of the front-
loaded expenditure pattern for most of
the leases(Henderson and et.al, 2015).

Recommended actions
• Consideration of a cross-functional
approach
• Introduction of changes
• Compliance towards applicable
standards and provisions
• Adherence towards qualitative
characteristics

References
• Annual Report of Myer, 2017. [pdf]. Available from <
http://www.annualreports.com/HostedData/AnnualRepor
ts/PDF/ASX_MYR_2017.pdf>. [Accessed on 1 October
2018].
• Henderson, S., Peirson, G., Herbohn, K. and Howieson,
B., 2015. Issues in financial accounting. Pearson Higher
Education AU.
• Joubert, M., Garvie, L. and Parle, G., 2017. Implications
of the New Accounting Standard for Leases AASB 16
(IFRS 16) with the Inclusion of Operating Leases in the
Balance Sheet. Journal of New Business Ideas &
Trends, 15(2).

Thankyou