Amendments to PBE Standards

Additional going concern disclosures

As mentioned in our August 2020 edition of Accounting Alert the impacts of COVID-19 may result in many entities experiencing material uncertainty regarding the going concern assumption when preparing financial statements.

As a result of this increase in the level of uncertainty over the ability of entities to continue as a going concern for financial reporting purposes, the New Zealand Accounting Standards Board (NZASB) has issued an amendment to PBE IPSAS 1 Presentation of Financial Statements.

The amendment introduces specific going concern disclosure requirements to assist preparers of financial statements in providing improved and consistent disclosures, where an entity’s going concern assessment has involved the application of significant judgement and/or the consideration of material uncertainties about the outcomes of future events or conditions.

The amendment to PBE IPSAS 1 is effective for accounting periods ending on or after 30 September 2020, with early adoption permitted.

You can access the amended standard here.

Deferral of effective dates

In addition, to assist constituents who were struggling with the effects of COVID-19 on their activities, the NZASB has elected to defer the effective date of the following PBE Standards. The below PBE Standards are still available for early adoption.

• PBE FRS 48 Service Performance Reporting
  The amendments defer the effective date of PBE FRS 48 by one year from 1 January 2021 to annual reporting periods beginning on or after 1 January 2022.

• PBE IFRS 17 Insurance Contracts,
  The amendments defer the effective date of PBE IFRS 17 by one year from 1 January 2022 to annual reporting periods beginning on or after 1 January 2023. Early adoption is permitted, provided an entity also applies PBE IPSAS 41 Financial Instruments.

 

For more on the above, please contact your local BDO representative.