The corporate regulator’s review of 215 listed and other public interest entities saw it make inquiries of 55 entities on 79 matters, seeking explanations of accounting treatments.
Impairment and other asset values was the most sought after matter with 28 inquiries, followed by revenue recognition with 18 inquires, and tax accounting with 11.
Consolidation accounting, business combinations, and expense deferral round up the top six matters.
“ASIC’s concerns continue to relate to impairment of non-financial assets and inappropriate accounting treatments,” said ASIC commissioner John Price.
“Directors and auditors should focus on values of assets and accounting policy choices in preparing their December 2018 financial reports.”
Matters involving 13 of the entities have been concluded without any changes to their financial reporting, with ASIC noting that inquiries of individual entities may not necessarily lead to material restatements.
ASIC has called on companies to focus on new requirements that can materially affect reported assets, liabilities and profits for both full-year and half-year reports at 31 December 2018.
This is not the first time ASIC has raised concerns over the new accounting standards, with the corporate regulator noting a general lack of preparedness by entities last year.
Last week, the corporate regulator released its findings of its audit review, finding that in 20 per cent of cases, auditors did not obtain reasonable assurance that the financial report was free from material misstatement.
Issues relating to impairment of non-financial assets and inappropriate accounting treatments have been on ASIC’s radar for some time now, with the corporate regulator making inquiries over the same issues in 2016.
Jotham Lian is the news 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.