Harmonisation Amendments
The objective of the harmonisation is to bring the New Zealand equivalents to International Financial Reporting Standards (NZ IFRSs) and Australian Accounting standards into line with source IFRSs.
Both jurisdictions have amended their adopted IFRSs with source IFRSs issued by the International Accounting Standards Board, to eliminate the differences between source IFRS and adopted IFRS as well as to achieve trans-Tasman harmonisation. New Zealand specific requirements have either been deleted or been moved into a separate standard, FRS 44 (see below).
The effective date is for reporting periods beginning on or after 1 July 2011 but earlier adoption is permitted. Entities can individually adopt the amendments for a specific standard earlier but must disclose this as well as adopt any specific requirements in FRS 44 relating to that standard.
Issue of FRS 44 New Zealand Additional Disclosures
FRS 44 sets out the New Zealand specific disclosures for entities that have adopted NZ IFRS. These disclosures have been relocated from NZ IFRSs into FRS 44 as separate disclosures required in addition to those within IFRSs. Entities preparing financial statements under NZ IFRSs must also apply FRS 44 as it is part of NZ GAAP. Entities applying the differential reporting framework must also comply with FRS 44.
The effective date is for reporting periods beginning on or after 1 July 2011 but earlier adoption is permitted.
Amendments to NZ IFRS 7 Financial Instruments: Disclosures – Appendix E New Zealand specific disclosures
The amendments to NZ IFRS 7 have now been issued by the ASRB. Appendix E has not been removed from NZ IFRS, instead the term ‘financial institution’ has been replaced with ‘deposit taker’ as defined in the Reserve Bank of New Zealand Act 1989.
The Reserve Bank considered that removal of Appendix E would mean non-bank deposit takers would not provide the required disclosures, as banking entities are covered by the Order in Council Registered Bank Disclosure Statements 2011.
To avoid this, the FRSB has limited the scope of Appendix E to non-bank deposit takers until the Reserve Bank has introduced its new reporting regime for this group. Once that occurs, the FRSB intend to remove Appendix E in its entirety.