accountants daily logo

ASIC signals 2018 focus on accounting standards in fresh report


The corporate regulator outlined areas that professionals should be particularly careful with as new accounting standards come into effect.

By Jotham Lian 9 minute read
var typesArray = { desktop: [882], tablet: [4223], mobile: [1578], }; var zoneArray = [254145]; var zoneDivId = '#momentum-azk257428-zoneunit'; changePlacements(true, zoneDivId, typesArray, zoneArray, '');
>Yesterday, ASIC released Report 567: ASIC regulation of corporate finance, covering its regulatory approach in the corporate finance sector for the period July to December 2017.

Repeating its focus area from late last year, the corporate regulator has announced that it will be “closely reviewing” the implementation of the three new accounting standards and its implication in fundraising transactions.

The three major accounting standards being introduced include AASB 9 Financial Instruments (applies from years commencing 1 January 2018); AASB 15 Revenue from Contracts with Customers (applies from years commencing 1 January 2018); and AASB 16 Leases (applies from years commencing 1 January 2019).

In particular, ASIC will be paying close attention to disclosure practices for historical and prospective financial information.

“In addition to ensuring implementation of these new standards, we consider that companies and their advisers should be careful when preparing for any transactions that will require disclosure of historical and prospective financial information that overlaps the respective implementation dates,” said ASIC in Report 567.

In the report, ASIC suggested for accountants to consider providing appropriate disclosure of the future effect of the new accounting standards; and the prominence given to financial information presented under the pre-existing standards and the new standards, taking into account the size and extent of the effect of applying the new standards.

Additionally, advisers should consider presenting historical and prospective financial information on a consistent basis, or presenting information on both bases for an overlap period; ensuring the effects on historical financial information are presented clearly by a general discussion, reconciliation of key items (such as profit and net assets), and/or line-by-line reconciliations for one or more years.

They should also consider disclosing key assumptions made when applying the new standards to forecast information; and clearly identifying whether the pre-existing or new standards have been applied to particular information.

The new accounting standards have been a hot topic for the industry, with a recent PwC report finding less than 10 per cent of companies in the ASX 100 had completed their impact assessment for the standards.

In its report, the corporate regulator also noted it would continue to focus on the top five most frequent disclosure concerns, including, inadequate risk disclosure; inadequate business model disclosure; insufficient details regarding proposed use of funds; lack of clear, concise and effective disclosure; and unbalanced disclosure.

Fundraising issues have been an ongoing concern for ASIC, with its previous report focusing on the application of the sophisticated investor test.

This email address is being protected from spambots. You need JavaScript enabled to view it.

Jotham Lian

Jotham Lian


Jotham Lian is the editor of Accountants Daily, the leading source of breaking news, analysis and insight for Australian accounting professionals.

Before joining the team in 2017, Jotham wrote for a range of national mastheads including the Sydney Morning Herald, and Channel NewsAsia.

You can email Jotham at: This email address is being protected from spambots. You need JavaScript enabled to view it. 

You are not authorised to post comments.

Comments will undergo moderation before they get published.