EXPLANATORY STATEMENT
Reasons for Issuing AASB 13
The International Accounting Standards Board (IASB) has issued IFRS 13Fair Value Measurementfor annual reporting periods beginning on or after 1 January 2013, with early application permitted. The AASB needs to issue AASB 13Fair Value Measurementto enable Australian reporting entities to continue to be compliant with International Financial Reporting Standards in relation to fair value measurement.
Main Features of AASB 13
AASB 13defines fair value, sets out a framework for measuring fair value and requires enhanced disclosures about fair value measurements. The Standard explains how to measure fair value for financial reporting purposes and does not require fair value measurements in addition to those already required or permitted by other Australian Accounting Standards.
Application Date
AASB 13is applicable to annual reporting periods beginning on or after 1 January2013, with early application permitted, for both for-profit and not-for-profit entities. Through a separate due process, the AASB will consider the relief from certain disclosure requirements that should be provided to entities that adopt Tier 2 Reduced Disclosure Requirements.
Consultation Prior to Issuing this Standard
The AASB issued Exposure Draft ED 181Fair Value Measurement in June 2009. A second Exposure Draft ED 199 Measurement Uncertainty Analysis Disclosure for Fair Value Measurements (Limited re-exposure of proposed disclosure) was issued in July 2010. The submissions received on ED 181 were generally supportive of the objective of the project, whilst there was limited support for the proposals in ED 199. AASB 13 generally takes into account the comments received on the Exposure Drafts.
A Regulation Impact Statement has not been prepared in connection with the issuance of AASB 13 as the amendments made are minor in nature.