ASIC has announced its areas of focus for 30 June 2013 financial reports which include operating and financial reviews, new accounting standards on consolidated reports and joint arrangements, asset impairments, value of non-traded financial instruments, going concern assessments and revenue recognition and expense deferral policies. Directors, auditors and preparers of financial reports will need to be particularly vigilant on these issues.
After releasing the results of its reviews on financial reports for proprietary companies for the year ending 31 December 2012 (see Findings at 31 December 2012), ASIC has announced its areas of focus for 30 June 2013 financial reports. ASIC has indicated that preparers of financial reports should focus in particular on:
- making useful and meaningful analysis in the operating and financial review (and compliance with the guidance in ASIC Regulatory Guide 247 Effective disclosure in an operating and financial review);
- the impact of new Accounting Standards AASB 10 Consolidated Financial Statements, AASB 11 Joint Arrangements and AASB 13 Fair Value Measurement;
- the impairment of goodwill and other non-current assets;
- the value of financial instruments that are not traded in an active market;
- going concern assessments; and
- revenue recognition and expense deferral policies.
ASIC has also indicated that its surveillance will include entities with shadow banking activities (such as unlisted debenture issuers) and selected larger proprietary companies.
See also ASIC’s media release dated 2 July 2013.
See also ICAA guidance for 2013 reporting season.