Construction Contracts (Retention Money) Amendment Act 2023
For all head contractors who hold retention monies in commercial construction contracts please note that the Construction Contracts (Retention Money) Amendment Act 2023 (the Act) has received Royal Assent and is effective from 5 October 2023.
The Act amends the Construction Contracts Act 2002 retention money regime and affects all head contractors who withhold retention money in relation to a commercial construction contract.
Chartered Accountants Australia New Zealand (CA ANZ) has published a set of FAQs to assist the finance teams of impacted entities with gaining an overview of the requirements of the Act along with providing guidance on how to account for construction contract retention money under the requirements of the Act and New Zealand equivalents to International Financial Reporting Standards (NZ IFRS).
It should be noted that the impacts of the Act may require impacted entities to change systems, policies and procedures to comply with the Act.
Please contact our Construction and Real Estate team if you require assistance with implementing policies and procedures required by the Act or in the accounting therefore.
For more on the above, please contact your local BDO representative.