Financial Reporting Newsletter - Updates and Developments, Sem 1

This newsletter, prepared for staff of a large accounting firm, provides a concise overview of recent developments in financial reporting. It covers key updates from the Australian Accounting Standards Board (AASB), including the elimination of Special Purpose Financial Statements (SPFS) and the introduction of a new simplified disclosure standard (AASB 1060). It also highlights exposure drafts from the International Public Sector Accounting Standards Board (IPSASB) regarding revenue and transfer expenses, and focuses on financial reporting by the Australian Securities and Investments Commission (ASIC). Furthermore, the newsletter addresses the impact of the Coronavirus pandemic, including tips for small businesses, updated guidance on Annual General Meetings (AGMs), and support for a moratorium in corporate reporting. It also discusses CA ANZ's response to COVID-19 challenges and the potential shift in accounting for goodwill. The newsletter includes references to the sources of information, ensuring staff can access further details. The goal is to keep staff informed on changes and developments that may impact their work in preparing general purpose financial reports for large companies listed on the ASX.

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Newsletter
Name of the Student
Name of the University
Author’s Note

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AUSTRALIAN NEWS
Major Facts Documents for
Explaining Elimination of
SPFS and New Simplified
Disclosure Standard
(26.03.2020)
Under the standards of
AASB, it will no longer be
required for certain type of
for-profit companies in the
private sector to prepare
special purpose financial
statements (SPFS). A second
key facts document explains
the reason of releasing a new
simplified disclosure
standard by AASB that is
AASB 1060 in combination
with the changes made by
AASB 2020-2 (aasb.gov.au,
2020).
Exposure Draft of IPSASB:
Revenue and Transfer
Expenses for Public Sector
Entities (11.03.2020)
Three exposure drafts have
recently been issued by the
IPSASB those propose new
requirements for recognition
and measurement of revenue
transactions and transfer
expenses. These drafts are
IPSASB ED 70 Revenue with
Performance Obligations,
IPSASB ED 71 Revenue
without Performance
Obligations and IPSASB ED
72 Transfer Expenses
(aasb.gov.au, 2020).
19-341MR Financial
Reporting Focuses
(06.12.2019)
ASIC has called on the
companies to emphasize on
new requirements that can
create material impacts on
reporting of assets, liabilities
and profits. The main focus
areas include new accounting
standards, the role of
directors, revenue of
governance and other
information. These focus
areas for the financial reports
of the listed entities and other
entities of public interest
having many stakeholders
(asic.gov.au, 2020).
Disruption of Coronavirus
and Tips for Small
Businesses (06.03.2020)
Tips for the small businesses
facing the likelihood of major
disturbance from the
outbreak of coronavirus have
been released by CPA
Australia. It has provided the
small businesses with some
key advices so that they are
continue their operations
smoothly in the outbreak of
coronavirus pandemic
(cpaaustralia.com, 2020).

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INTERNATIONAL NEWS
Issue of Update Guidance
on AGM and the Impact of
Covid- 19 (27.03.2020)
Updated regulations about
the AGM of the companies
along with the impact of
Covid-19 have been
published by the FRC and the
Chartered Governance
Institute. These regulations
contain advices on how
contingency plans might be
implemented by the listed
companies in accordance
with the compulsory ‘Stay at
Home Measures’ (frc.org.uk,
2020).
Moratorium in Corporate
Reporting supported by
FRC (23.03.2020)
As requested by the Financial
Conduct Authority (FCA), a
moratorium is observed by
all the listed companies on
the publication of preliminary
financial statements for at
least two weeks. Both the
FCA and FRC have worked
closely on this matter along
with the other regulatory
agencies over the past few
weeks for completely
supporting the request f the
FCA. Recent unprecedented
events refer to the basis on
which reporting and planning
of the companies are
changing quickly; and the
companies are required to
provide the due consideration
to these aspects at the time of
corporate and financial
reporting (frc.org.uk, 2020).
Response to the Challenges
of COVID-19 (20.03.2020)
CA ANZ is providing major
assistance in meeting the
financial reporting and audit
challenges that are posed by
the global outbreak of
COVID-19. Active
engagement of CA ANZ can
be seen with the regulators
for the identification and
development of necessary
strategies for relief. This
requires careful thoughts and
effective planning for
managing and reporting on
the effects of this crisis. A
wide range of resources have
been prepared by the CA
ANZ and other members for
assisting the companies to
face the unique challenges
(charteredaccountantsanz.co
m, 2020).
Accounting for Goodwill
(02.03.2020)
The accounting treatment of
goodwill arising from a
business combination has
been taken into consideration
by the IASB and FASB; and
both of these agencies are
considering the possibility to
revert accounting for
goodwill to an amortization
model. The aim is to provide
more clear information to the
users of financial statements
(charteredaccountantsanz.co
m, 2020).

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References
Cpaaustralia.com.au. (2020). Coronavirus disruption and tips for small business. Retrieved 13 April
2020, from https://www.cpaaustralia.com.au/-/media/corporate/allfiles/document/media/media-
release/tips-for-small-business-to-prepare-for-coronavirus-2020.pdf?
la=en&rev=322c4db11168442a89dece68d210d54b
Financial Reporting Council . (2020). Frc.org.uk. Retrieved 13 April 2020, from
https://www.frc.org.uk/news/march-2020-(1)/updated-guidance-about-agms-and-the-impact-of-
covi
Financial Reporting Council . (2020). Frc.org.uk. Retrieved 13 April 2020, from
https://www.frc.org.uk/news/march-2020-(1)/frc-supports-moratorium-in-corporate-reporting
Responding to the challenges of COVID19. (2020). CAANZ. Retrieved 13 April 2020, from
https://www.charteredaccountantsanz.com/news-and-analysis/news/responding-to-the-
challenges-of-covid19
Goodwill – are we moving back to an amortisation model?. (2020). CAANZ. Retrieved 13 April 2020,
from https://www.charteredaccountantsanz.com/news-and-analysis/news/goodwill-are-we-
moving-back-to-an-amortisation-model
19-341MR Financial reporting focuses for 31 December 2019 | ASIC - Australian Securities and
Investments Commission . (2020). Asic.gov.au. Retrieved 13 April 2020, from
https://asic.gov.au/about-asic/news-centre/find-a-media-release/2019-releases/19-341mr-
financial-reporting-focuses-for-31-december-2019/
News . (2020). Aasb.gov.au. Retrieved 13 April 2020, from https://www.aasb.gov.au/News/Key-facts-
documents-to-explain-removal-of-SPFS-and-the-new-simplified-disclosure-standard?
newsID=357747
News . (2020). Aasb.gov.au. Retrieved 13 April 2020, from https://www.aasb.gov.au/News/IPSASB-
Exposure-Drafts--Revenue-and-Transfer-Expenses-for-public-sector-entities?newsID=357740