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Eye on Reporting - September 2012

September 2012

Welcome to the September edition of Eye on Reporting.

On 18 September 2012, the New Zealand Accounting Standards Board (NZASB) issued for comment an Exposure Draft (ED) in response to concerns raised by constituents about how the new multi-standards accounting framework will impact Public Benefit Entity (PBE) groups that contain for-profit entities, referred to as mixed groups. We provide an overview of the ED and highlight the key points in our publication Accounting Standards Framework: Mixed Groups. The ED is open for comment until the 21 December 2012.

Earlier this month the Financial Markets Authority (FMA) issued a Guidance Note on disclosing alternative performance measures and other types of "non-GAAP" financial information, such as underlying profits, EBIT and EBITDA. These alternative profit measures often appear in company media releases, analyst briefings, prospectuses and other investor communications. The Guidance Note sets out the FMA's views on disclosing non-GAAP financial information, including what other information also should be disclosed, so that the information is not misleading. In our publication Alternative performance measures we provide a summary of the FMA Guidance Note and highlight what you need to know.

Almost a year after finalising the redeliberations, the International Accounting Standards Board (IASB) and US Financial Accounting Standards Board (US FASB) project on general hedge accounting is now finally on the home straight.  The IASB has issued a Review Draft of Phase III of IFRS 9 which contains some significant changes to certain aspects of the original proposals. In our latest IFRS Developments we summaries these developments and take a closer look the Review Draft.

If you would like any further information on any of these topics or the topics below, please get in touch with our Financial Accounting Advisory Services Team.

To find out more about the services we offer in this area please contact EY's Financial Accounting Advisory Services Team

Kimberley Crook

Partner, Auckland

+64 9 300 7094

David Pacey

Executive Director, Auckland

+64 274 899 049

Lara Truman

Executive Director, Wellington

+64 274 899 896

Ravi Kumar

Senior Manager, Auckland

+64 212 214 717

Jude Doliente

Manager, Auckland

+64 212 417 481

David Bassett

Senior Accountant, Auckland

+64 274 899 883

Kind regards
Kimberley Crook
Financial Accounting Advisory Services

Hot topics

  • Accounting Standards Framework: Mixed Groups
    In response to concerns raised by constituents about the impact that the new multi-standards accounting framework will have on Public Benefit Entity (PBE) groups which contain for-profit entities within the group, the NZASB has issued for comment Exposure Draft 2012-4 Framework: PBE Standards — Mixed Groups (ED). The new framework will require Tier 1 and Tier 2 PBEs to apply the new PBE standards while Tier 1 and Tier 2 for-profit entities will continue to apply NZ IFRS. Where differences exist between NZ IFRS and PBE Standards for like transactions, consolidation adjustments may be needed. The ED proposes guidance on preparing consolidated financial statements in mixed group situations and sets out the NZASB’s strategy to respond to emerging differences between PBE Standards and NZ IFRS.

    Our publication summaries the key points in the ED. Comments on the ED are due to the NZASB by 21 December 2012.

  • Alternative performance measures
    Our publication summarises the recently issued Financial Markets Authority (FMA) Guidance Note on disclosing alternative performance measures and other types of “non-GAAP” financial information, such as “underlying profits”, EBIT and EBITDA. The FMA’s Guidance Note is focused on financial information presented outside of the statutory financial statements, such as in media releases, investor presentations, analyst briefings, management commentary in annual reports and prospectuses. The Guidance Note sets out the FMA’s views on disclosing financial information other than in accordance with GAAP (called non-GAAP financial information) and what additional disclosures should be made so that the information is not misleading.

  • Hedge accounting project on the home straight 
    Almost a year after finalising the redeliberations, the general hedge accounting project is finally on the home straight. Issue 40 of IFRS Developments summarises the key developments and discusses the review draft issued by the IASB.

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IFRS news and updates

  • Financial reporting considerations in the current economic volatility 
    The latest edition of IFRS Outlook looks at some of the key financial reporting considerations under IFRS that may impact disclosures of risk in 2012 financial statements.
  • Interim reporting – are you telling the half-time story? 
    Current economic uncertainties have significantly increased the importance of interim reporting. IFRS Outlook discusses our survey of more than 200 professional investors and deals with three key IFRS issues dealing with interim reporting.
  • Financial instruments: Classification and measurement – joint deliberations now complete
    Issue 38 of IFRS Developments presents the discussions held between the International Accounting Standards Board (IASB) and US Financial Accounting Standards Board (US FASB) at their joint meeting on the accounting for the reclassification of financial assets between measurement categories and related disclosures.
  • Draft interpretation on levies
    Issue 39 of IFRS Developments summarises what you need to know about the clarifications proposed in the Draft Interpretation published by the IFRS Interpretations Committee around the recognition and measurement of the liability for levies charged by public authorities on entities operating in a specified market.
  • EFRAG and OIC Questionnaire on impairment requirements for goodwill
    The European Financial Reporting Advisory Group (EFRAG) and the Italian standard setter Organismo Italiano di Contabilita (OIC) have jointly issued a questionnaire on impairment requirements for goodwill. The questionnaire is aiming to provide early input to the IASB's post-implementation review of IFRS 3 Business Combinations.

    Interested parties are invited to complete the questionnaire before 30 September 2012.

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On the horizon

Below are recent Exposure Drafts which are currently open for comment to the New Zealand Accounting Standards Board (NZASB), IASB and/or International Public Sector Accounting Standards Board (IPSASB). Please refer to the current exposure draft section on the XRB website for more details (www.xrb.govt.nz).

Standard/Exposure Draft
Comments due to NZASB by
Comments due to IASB by
Comments due to IPSASB by
 IASB issues draft of the forthcoming IFRS on general hedge accounting 
16 November 2012
 
 
 Package 2: Public Sector PBE Accounting Standards 
14 December 2012
 
 
 Exposure Draft ED 2012-4 Framework: PBE Standards - Mixed Groups 
21 December 2012
 
 

Draft IFRIC Interpretation DI/2012/2 Put Options Written on Non-controlling Interests

CLOSED
1 October 2012
 
 IASB Request for Information Comprehensive Review of the IFRS for SMEs 
12 October 2012
 30 November 2012
 

IASB’s Request for Information – Post-implementation Review: IFRS 8 Operating Segments

19 October 2012

16 November 2012

 

IPSASB Consultation Paper - Public Sector Combinations

1 October 2012
 
31 October 2012

Consultation on IPSASB Work Program 2013–2014

15 October 2012
 
31 October 2012

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Events and Webcasts

  • Click here to access a summary of all upcoming webcasts.
    If you missed any of the recent global webcasts you can now watch them via the webcast archive

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Contacts

For more information on any of the points raised in this newsletter, please contact a member of EY’s Financial Accounting Advisory Services Team.

To find out more about the services we offer in this area please contact EY's Financial Accounting Advisory Services Team

Kimberley Crook

Partner, Auckland

+64 9 300 7094

David Pacey

Executive Director, Auckland

+64 274 899 049

Lara Truman

Executive Director, Wellington

+64 274 899 896

Ravi Kumar

Senior Manager, Auckland

+64 212 214 717

Jude Doliente

Manager, Auckland

+64 212 417 481

David Bassett

Senior Accountant, Auckland

+64 274 899 883


The information contained in this newsletter does not constitute advice and should not be relied upon as such.  Professional advice should be sought prior to action being taken on any of the information.

Contact us

Kimberley Crook
+64 9 300 7094

Graeme Bennett
+64 9 300 8191

Lara Truman
+64 274 899 896

David Pacey
+64 212 425 716

Asia Pacific Financial Accounting Advisory Services contacts.

Applying IFRS in New Zealand

The time for companies to ensure their financial reporting systems comply with NZ equivalents of International Reporting Standards is now. EY provides you with the tools and resources to help you with the task ahead.

EY  

 

Eye on Reporting

Eye on Reporting is our monthly update on financial reporting developments.

Please click here to read the current issue.