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AASB 1039 - Concise Financial Reports - April 2005

Authoritative Version
AASB 1039 Standards/Accounting & Auditing as amended, taking into account amendments up to AASB 2007-8 - Amendments to Australian Accounting Standards arising from AASB 101 - September 2007
Administered by: Treasury
General Comments: This compilation represents the Standard as at the making date of the last Amending Standard shown in the Table of Standards.
Registered 14 May 2014
Start Date 26 Oct 2007

Compiled Accounting Standard

AASB 1039

 

 

 

 

 

Concise Financial Reports

 

 

This compiled Standard applies to annual reporting periods beginning on or after 1 January 2009.  Early application is permitted.  It incorporates relevant amendments made up to and including 24 September 2007.

 

Prepared on 7 October 2009 by the staff of the Australian Accounting Standards Board.

 

 

 

Description: AASB_stacked



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COPYRIGHT

 

© 2009 Commonwealth of Australia

 

This work is copyright.  Reproduction in unaltered form (retaining this notice) is permitted for personal and non-commercial use subject to the inclusion of an acknowledgment of the source.  Apart from any use as permitted under the Copyright Act 1968, no part may be reproduced by any process without prior written permission from the Australian Accounting Standards Board.  Requests and enquiries concerning reproduction and rights for commercial purposes should be addressed to The Director of Finance and Administration, Australian Accounting Standards Board, PO Box 204, Collins Street West, Victoria 8007.


CONTENTS

                Page

COMPILATION DETAILS                                                                                       4

Accounting Standard

AASB 1039 Concise Financial Reports

 

1    Application                                                                                                             5

2    Operative Date                                                                                                       6

3    Purpose of Standard                                                                                             6

4    Preparation and Presentation                                                                              6

5    Financial Statements                                                                                            7

6    Specific Disclosures                                                                                            10

7    Relationship to Financial Report                                                                     12

8    Comparative Information                                                                                12

9    Definitions                                                                                                            12

 

 

Australian Accounting Standard AASB 1039 Concise Financial Reports (as amended) is set out in paragraphs 1.1 – 9.1.1.  All the paragraphs have equal authority.  Paragraphs in bold type state the main principles.  AASB 1039 is to be read in the context of other Australian Accounting Standards, including AASB 1048 Interpretation and Application of Standards, which identifies the Australian Accounting Interpretations.  In the absence of explicit guidance, AASB 108 Accounting Policies, Changes in Accounting Estimates and Errors provides a basis for selecting and applying accounting policies.

 


compilation details

Accounting Standard AASB 1039 Concise Financial Reports as amended

This compiled Standard applies to annual reporting periods beginning on or after 1 January 2009.  It takes into account amendments up to and including 24 September 2007 and was prepared on 7 October 2009 by the staff of the Australian Accounting Standards Board (AASB).

This compilation is not a separate Accounting Standard made by the AASB.  Instead, it is a representation of AASB 1039 (April 2005) as amended by other Accounting Standards, which are listed in the Table below.

Table of Standards

Standard

Date made

Application date
(annual reporting periods … on or after …)

Application, saving or transitional provisions

AASB 1039

14 Apr 2005

(ending) 31 Dec 2005

see (a) below

AASB 2007-8

24 Sep 2007

(beginning) 1 Jan 2009

see (b) below

 

(a)       Entities may elect to apply this Standard to annual reporting periods beginning on or after 1 January 2005 that end before 31 December 2005.

(b)       Entities may elect to apply this Standard to annual reporting periods beginning on or after 1 January 2005 but before 1 January 2009 provided that AASB 101 Presentation of Financial Statements (September 2007) is also applied to such periods.

Table of Amendments

Paragraph affected

How affected

By … [paragraph]

5.1

amended

AASB 2007-8 [6]

5.2.1

amended

AASB 2007-8 [6]

5.3.3

amended

AASB 2007-8 [6]

6.1

amended

AASB 2007-8 [6]

6.2

amended

AASB 2007-8 [149]

6.3

amended

AASB 2007-8 [6]

6.4

amended

AASB 2007-8 [6]


aCCOUNTING STANDARD AASB 1039

The Australian Accounting Standards Board made Accounting Standard AASB 1039 Concise Financial Reports under section 334 of the Corporations Act 2001 on 14 April 2005.

 

This compiled version of AASB 1039 applies to annual reporting periods beginning on or after 1 January 2009.  It incorporates relevant amendments contained in other AASB Standards made by the AASB up to and including 24 September 2007 (see Compilation Details).

 

 

 

aCCOUNTING STANDARD AASB 1039

Concise Financial Reports

1     Application

1.1      This Standard applies to a concise financial report prepared by an entity in accordance with paragraph 314(2)(a) in Part 2M.3 of the Corporations Act.

1.1.1  Under the Corporations Act a company, registered scheme or disclosing entity can elect to send to its members for a financial year a concise report, which includes a concise financial report instead of the financial report. 

1.2      Where an entity is the parent of a group, this Standard applies to the consolidated financial statements of the entity and the notes to those statements, and does not require that parent financial information be provided.

1.2.1  If the entity provides parent financial information in addition to consolidated financial information, the parent financial information is also subject to the requirements of this Standard.

1.3      Notwithstanding the application requirements in Accounting Standard AASB 1031 Materiality, the disclosures required in this Standard are subject to the requirements of AASB 1031.

1.3.1  As this Standard applies to a wider range of entities than does AASB 1031, paragraph 1.3 of this Standard clarifies that the requirements of AASB 1031 are applicable to all concise financial reports prepared under this Standard, even for those entities that would not otherwise be subject to AASB 1031.

2     Operative Date

2.1      This Standard applies to annual reporting periods ending on or after 31 December 2005.
[Note:  For application dates of paragraphs changed or added by an amending Standard, see Compilation Details.]

2.2      This Standard may not be applied to annual reporting periods beginning before 1 January 2005.

2.3      When applied or operative, this Standard supersedes Accounting Standard AASB 1039 Concise Financial Reports as notified in the Commonwealth of Australia Gazette No S196 on 14 June 2002.

2.3.1  This Standard will be registered on the Federal Register of Legislative Instruments, together with its Explanatory Statement, in accordance with the Legislative Instruments Act 2003.

3     Purpose of Standard

3.1      The purpose of this Standard is to specify the minimum content of a concise financial report.

3.1.1  The requirements of the Corporations Act relating to concise financial reports are based on the view that a concise financial report can provide members with information relevant to evaluating the business, without giving them fully detailed accounting disclosures.  For some members, the provision of less detailed information is expected to be sufficient to meet their needs for an understanding of the financial performance, financial position and financing and investing activities of the company, registered scheme or disclosing entity. 

3.1.2  The minimum content required by this Standard is intended also to provide sufficient information to permit members to identify if and when they consider it would be useful to obtain more comprehensive and detailed information by requesting a copy of the financial report.

4     Preparation and Presentation

4.1      The financial statements and specific disclosures (identified in Section 6 of this Standard) required in a concise financial report shall be derived from the financial report of the entity.  Any other information included in a concise financial report shall be consistent with the financial report of the entity.

4.1.1  In order to achieve consistency and comparability with information included in the financial report, this Standard requires the accounting policies relating to recognition and measurement applied in the preparation of a concise financial report to be the same as those adopted in the preparation of the financial report.

4.1.2  This Standard prescribes the minimum information to be disclosed in a concise financial report but does not prescribe the format in which that information is presented.  The format for the presentation of information in a concise financial report is developed having regard to the particular circumstances of the entity and the presentation of relevant, reliable, understandable and comparable information about the entity’s financial performance, financial position and financing and investing activities.  Entities are encouraged to develop a format that best meets the information needs of their members. 

4.1.3  The consistency required by paragraph 4.1 means that information voluntarily included in the concise financial report is determined in accordance with the treatment adopted in the financial report.  When the information in the financial report was determined in accordance with an Accounting Standard, the same treatment is adopted in the concise financial report.

4.2      The nature and estimated magnitude of particular items are disclosed if it is likely that the concise financial report would be misleading without such disclosures. 

4.2.1  The content of a concise financial report specified in this Standard constitutes the minimum level of disclosure.  Where there are particular features of the operations and activities of the entity that are significant, the entity may need to provide additional information in the concise financial report in order to comply with paragraph 4.2.  Similarly, members benefit from industry-specific disclosures, for example, disclosure of additional information by mining companies in relation to exploration and evaluation expenditure and decommissioning costs, and by banks and other financial institutions in relation to doubtful debts.

5     Financial Statements

5.1      A concise financial report shall include the following financial statements:

(a)      a statement of comprehensive income for the annual reporting period;

(b)      a statement of financial position as at the end of the annual reporting period;

(c)       a statement of cash flows for the annual reporting period; and

(d)      a statement of changes in equity (or statement of recognised income and expense) for the annual reporting period.

5.1.1  In accordance with paragraph 96, AASB 101 Presentation of Financial Statements, a statement of changes in equity that comprises only the items identified in paragraph 96(a) to (d) shall be titled a statement of recognised income and expense.

5.2      Each financial statement shall be presented as it is in the financial report, in accordance with other Accounting Standards, except for the omission of cross-references to notes to the financial statements in the financial report.

5.2.1  All the notes to the financial statements required by other Accounting Standards are not required in the concise financial report.  For example, disclosure of the reconciliation between the statement of comprehensive income and the statement of cash flows is not required by this Standard.  However, information required in some notes by other Accounting Standards is required when specified in this Standard.

5.2.2  It is recommended that the financial statements in the concise financial report be cross-referenced, where appropriate, to disclosures included in the concise financial report.

5.2.3  When the entity is a parent and only the consolidated financial statements are presented, the lack of financial statements for the parent would not be regarded as contravening paragraph 5.2.

5.3      The financial statements of entities other than listed companies shall be accompanied by discussion and analysis to assist the understanding of members.

5.3.1  Listed companies are not required by this Standard to provide discussion and analysis in the concise financial report because, unlike other entities, they are required by section 299A of the Corporations Act to provide an operational and financial report in the Directors’ Report that is part of the concise report.  Paragraph 5.3 only exempts listed companies from the statutory obligation to provide discussion and analysis of the financial statements.  It does not prohibit a listed company from providing any discussion and analysis that it considers would assist a reader to understand the financial statements in the concise financial report.

5.3.2  The information reported in the financial statements will be enhanced by a discussion and analysis of the principal factors affecting the financial performance, financial position and financing and investing activities of the entity.  The extent of the discussion and analysis provided will vary from entity to entity, and from year to year, as is necessary in the circumstances to help compensate for the brevity of the concise financial report compared with the financial report.

5.3.3  In most situations, the content of the discussion and analysis would cover at least the following areas:

(a)      in relation to the statement of comprehensive income:

(i)        trends in revenues;

(ii)       the effects of significant economic or other events on the operations of the entity;

(iii)      the main influences on costs of operations; and

(iv)     measures of financial performance such as return on sales, return on assets and return on equity;

(b)      in relation to the statement of financial position:

(i)        changes in the composition of assets;

(ii)       the relationship between debt and equity; and

(iii)      significant movements in assets, liabilities and equity items;

(c)       in relation to the statement of cash flows:

(i)        changes in cash flows from operations;

(ii)       financing of capital expenditure programs; and

(iii)      servicing and repayment of borrowings; and

(d)      in relation to the statement of changes in equity:

(i)        changes in the composition of the components of equity; and

(ii)       causes of significant changes in subscribed capital, such as rights issues, share buy-backs or capital reductions.

6     Specific Disclosures

6.1      When the entity has prepared its financial report on the basis that the entity is not a going concern, or where the going concern basis has become inappropriate after the end of the reporting period, this fact shall be disclosed.

6.2      The following information shall be disclosed for each reportable segment identified in the financial report in accordance with Accounting Standard AASB 8 Operating Segments:

(a)      segment revenue, distinguishing between revenues from sales to external customers and revenues from transactions with other segments;

(b)      segment result;

(c)       segment assets; and

(d)      segment liabilities.

6.3      The following items for the period shall be disclosed even if the amounts are zero (since these items are material by their nature):

(a)      the amount of sales revenue recognised and included in revenue in accordance with Accounting Standard AASB 118 Revenue;

(b)      the amount of dividends, in aggregate and per share, identifying:

(i)       dividends paid during the period and date of payment; and

(ii)      dividends proposed or declared before the financial report was authorised for issue, and the expected date of payment, separately identifying, where relevant, those recognised from those not recognised as a distribution to owners during the period;

(c)       in respect of each dividend disclosed in accordance with paragraph 6.3(b) of this Standard, the amount, in aggregate and per share, of the dividend that:

(i)       has been or will be franked and the tax rate at which the dividend has been or will be franked; and

(ii)      has not been or will not be franked; and

(d)      where the entity is required to comply with Accounting Standard AASB 133 Earnings per Share, the amount of basic earnings per share and diluted earnings per share.

6.4      The following items shall be disclosed:

(a)      the presentation currency used;

(b)      in respect of each event occurring after the end of the reporting period that does not relate to conditions existing at the end of the reporting period, the information required by paragraph 21 of Accounting Standard AASB 110 Events after the Reporting Period; and

(c)       where there is a change in accounting policy or estimates from those used in the preceding reporting period, or a correction of a prior period error, which has a material effect in the current reporting period or is expected to have a material effect in a subsequent reporting period, the information required about such a change or correction by the relevant Accounting Standards that are applicable to the current reporting period.

6.5      The concise financial report for the period when an entity first adopts Australian equivalents to IFRSs shall provide directions as to the location in the financial report of the reconciliations and other disclosures required by paragraphs 39 and 40 of AASB 1 First-time Adoption of Australian Equivalents to International Financial Reporting Standards.  A summary of this information shall be included in the concise financial report.

7     Relationship to Financial Report

7.1      The first page of the concise financial report shall prominently display advice to the effect that:

(a)      the concise financial report is an extract from the financial report;

(b)      the financial statements and specific disclosures included in the concise financial report have been derived from the financial report;

(c)       the concise financial report cannot be expected to provide as full an understanding of the financial performance, financial position and financing and investing activities of the entity as the financial report; and

(d)      further financial information can be obtained from the financial report and that the financial report is available, free of charge, on request to the entity.

8     Comparative Information

8.1      Information for the preceding corresponding reporting period which corresponds to the disclosures made in accordance with this Standard for the current reporting period shall be disclosed except when comparative information is not required to be disclosed in the financial report.

8.1.1  Any requirements relating to comparative information in other Accounting Standards that have been adopted in the preparation of the financial report are applicable in this Standard.

8.1.2  When disclosure is not required with respect to the current reporting period for an item in paragraphs 6.1 to 6.4 of this Standard but was required in the preceding reporting period, it is still necessary to disclose the comparative information.

9     Definitions

9.1      In this Standard, technical terms have the same meaning as in the relevant Accounting Standards applied in the preparation of the financial report for the current reporting period.

9.1.1  The terms “concise report”, “concise financial report”, “financial report”, “listed company” and “members” have the meanings as given or used in Chapter 2M of the Corporations Act.