The AASB has issued ED 295 General Purpose Financial Statements – Simplified Disclosures for For-Profit and Not-for-Profit Tier 2 Entities (ED 295). It is a further step in the wider Australian financial reporting reform project currently being undertaken by the Australian Accounting Standards Board (AASB).

ED 295 proposes replacing the current Reduced Disclosure Requirements (RDR) in the Australian Accounting Standards (AAS) with a new, separate disclosure standard (the Simplified Disclosures Standard or SD) that would apply to all entities that report under Tier 2. It will become the disclosure standard for all for-profit and not-for-profit (NFP) entities reporting under Tier 2 – AASB 10XX Simplified Disclosures for Tier 2 Entities.

We are releasing the following publications to assist in your deliberations on the AASB proposals contained in ED 295:

• Example Public Company Limited (current general purpose financial statements (GPFS)-Tier 1) (PDF 4.07 MB)
• Example Reduced Disclosure requirements Pty Ltd (current GPFS-Tier 2-RDR) (PDF 1.47MB)

Both publications focus on for-profit private sector example entities. They provide a visual illustration of the potential disclosures required by ED 295 compared to financial statements prepared in accordance with the current AAS Tier 1 or Tier 2-RDR, respectively. We trust you will find it a useful resource in considering the ED 295 proposals and responding to the AASB’s request for comments.

The approach taken to identify relevant disclosures is:

• disclosures shaded in yellow will not be required when preparing GPFS-Tier 2-SD
• disclosures shaded in blue will be required when preparing GPFS-Tier 2-SD, but in a different form, e.g. more aggregated or less detailed or prescriptive.

Disclosures that are not shaded yellow or blue will therefore form the basis of financial statements prepared for GPFS-Tier 2-SD entities.

ED 295 requires a small number of new additional disclosures. We have not sought to include these in the above publications.

Details relating to ED 295 are discussed in 19RU-012 Tier 2 Simplified Disclosures – ED 295.

Further discussion on the impact of Simplified Disclosures can be found in the PDF version of this Reporting Update.

The Australian financial reporting framework is undergoing its most significant overhaul in three-plus decades. To understand how the different pieces fit together, the respective entities affected and related application dates we have developed an online tool – visit KPMG.com/au/gpfs

Relevant updates will be incorporated on an ongoing basis.