Chartered Accounting Financial Reporting Handbook 2013 Incorporating all the Standards as at 1 December 2012

The 2013 edition contains:

• The AASB conceptual framework, Accounting Standards and Interpretations applicable for the 2013 reporting season, including the compiled versions of Standards issued to 1 December 2012. 
• AASB 10 Consolidated Financial Statements, AASB 11 Joint Arrangements, AASB 12 Disclosure of Interests in Other Entities, AASB 13 Fair Value Measurement and AASB 119 Employee Benefi ts, applicable from 1 January 2013, and AASB 9 Financial Instruments applicable from 1 January 2015. 
• A chapter explaining the AASB?s Reduced Disclosure Regime, together with AASB 1053 Application of Tiers of Australian Accounting Standards and AASB 2010?2 Amendments to Australian Accounting Standards arising from Reduced Disclosure Requirements.

The companion volume to this handbook, the Institute of Chartered Accountants Australia?s Auditing, Assurance and Ethics Handbook 2013, brings together all of the new and revised Australian Auditing Standards in Clarity format, Guidance Statements and professional and ethical standards as issued at 1 December 2012.

For latest information relating to Australian Accounting Standards, refer to www.aasb.gov.au, which is regularly updated throughout the year. The AASB website also contains the AASB?s versions of Standards and Interpretations amended for early adopters of the Reduced Disclosure Regime, which have not been included in this handbook.

About the Technical Editor vi

About the Institute of Chartered Accountants Australia xii

Introduction xiii

Reduced Disclosure Regime xvi

Statements of Accounting Concepts

SAC 1 Definition of the Reporting Entity 1

SAC 2 Objective of General Purpose Financial Reporting 10

Accounting Standards (AASBs) Framework for the Preparation and Presentation of Financial Statements 19

AASB 1 First–time Adoption of Australian Accounting Standards 40

AASB 2 Share–based Payment 69

AASB 3 Business Combinations 119

AASB 4 Insurance Contracts 158

AASB 5 Non–current Assets Held for Sale and Discontinued Operations 180

AASB 6 Exploration for and Evaluation of Mineral Resources 198

AASB 7 Financial Instruments: Disclosures 209

AASB 8 Operating Segments 246

AASB 9 Financial Instruments 259

AASB 10 Consolidated Financial Statements 309

AASB 11 Joint Arrangements 340

AASB 12 Disclosure of Interests in Other Entities 364

AASB 13 Fair Value Measurement 380

AASB 101 Presentation of Financial Statements 412

AASB 102 Inventories 444

AASB 107 Statement of Cash Flows 459

AASB 108 Accounting Policies, Changes in Accounting Estimates and Errors 481

AASB 110 Events after the Reporting Period 495

AASB 111 Construction Contracts 504

AASB 112 Income Taxes 516

AASB 116 Property, Plant and Equipment 561

AASB 117 Leases 581

AASB 118 Revenue 598

AASB 119 Employee Benefits (Compiled November 2010:applicable 30 June 2013) 616

AASB 119 Employee Benefits (Revised September 2011:applicable to periods beginning from 1 January 2013) 664

AASB 120 Accounting for Government Grants and Disclosure of Government Assistance 698

AASB 121 The Effects of Changes in Foreign Exchange Rates 708

AASB 123 Borrowing Costs 725

AASB 124 Related Party Disclosures 734

AASB 127 Consolidated and Separate Financial Statements (Compiled September 2011: applicable 30 June 2013) 754

AASB 127 Separate Financial Statements (Revised August 2011: applicable to periods beginning from 1 January 2013) 776

AASB 128 Investments in Associates (Compiled September 2011: applicable 30 June 2013) 783

AASB 128 Investments in Associates and Joint Ventures (Revised August 2011: applicable to periods beginning from 1 January 2013) 797

AASB 129 Financial Reporting in Hyperinflationary Economies 808

AASB 131 Interests in Joint Ventures 818

AASB 132 Financial Instruments: Presentation 833

AASB 133 Earnings per Share 885

AASB 134 Interim Financial Reporting 923

AASB 136 Impairment of Assets 947

AASB 137 Provisions, Contingent Liabilities and Contingent Assets 1005

AASB 138 Intangible Assets 1030

AASB 139 Financial Instruments: Recognition and Measurement 1059

AASB 140 Investment Property 1145

AASB 141 Agriculture 1164

AASB 1004 Contributions 1177

AASB 1023 General Insurance Contracts 1202

AASB 1031 Materiality 1238

AASB 1038 Life Insurance Contracts 1244

AASB 1039 Concise Financial Reports 1278

AASB 1048 Interpretation of Standards 1285

AASB 1049 Whole of Government and General Government Sector Financial Reporting 1294

AASB 1050 Administered Items 1370

AASB 1051 Land Under Roads 1381

AASB 1052 Disaggregated Disclosures 1392

AASB 1053 Application of Tiers of Australian Accounting Standards 1402

AASB 1054 Australian Additional Disclosures 1428

AASB 2010–2 Amendments to Australian Accounting Standards arising from Reduced Disclosure Requirements 1436

AASB 2010–7 Amendments to Australian Accounting Standards arising from AASB 9 (December 2010) [AASB 1, 3, 4, 5, 7, 101, 102, 108, 112, 118, 120, 121, 127, 128, 131, 132, 136,137, 139, 1023 & 1038 and Interpretations 2, 5, 10, 12, 19 & 127] 1460

AASB 2011–2 Amendments to Australian Accounting Standards arising from the Trans–Tasman Convergence Project – Reduced Disclosure Requirements [AASB 101 & AASB 1054] 1498

AASB 2011–4 Amendments to Australian Accounting Standards to Remove Individual Key Management Personnel Disclosure Requirements [AASB 124] 1502

AASB 2011–6 Amendments to Australian Accounting Standards – Extending Relief from Consolidation, the Equity Method and Proportionate Consolidation – Reduced Disclosure Requirements [AASB 127, AASB 128 & AASB 131] 1507

AASB 2011–7 Amendments to Australian Accounting Standards arising from the Consolidation and Joint Arrangements Standards[AASB 1, 2, 3, 5, 7, 101, 107, 112, 118, 121, 124, 132, 133, 136, 138, 139, 1023 & 1038 and Interpretations 5, 9, 16 & 17] 1516

AASB 2011–8 Amendments to Australian Accounting Standards arising from AASB 13 [AASB 1, 2, 3, 4, 5, 7, 9, 101, 102, 108,110, 116, 117, 118, 119, 120, 121, 128, 131, 132, 133, 134, 136,138, 139, 140, 141, 1004, 1023 & 1038 and Interpretations 2, 4,12, 13, 14, 17, 19, 131 & 132] 1536

AASB 2011–10 Amendments to Australian Accounting Standards arising from AASB 119 (September 2011) [AASB 1, AASB 8, AASB 101, AASB 124, AASB 134, AASB 1049 & AASB 2011–8, and Interpretation 14] 1569

AASB 2011–11 Amendments to AASB 119 (September 2011) arising from Reduced Disclosure Requirements 1579

AASB 2011–12 Amendments to Australian Accounting Standards arising from Interpretation 20 1583

AASB 2012–1 Amendments to Australian Accounting Standards – Fair Value Measurement – Reduced Disclosure Requirements [AASB 3, AASB 7, AASB 13, AASB 140 and AASB 141] 1586

AASB 2012–2 Amendments to Australian Accounting Standards – Disclosures – Offsetting Financial Assets and Financial Liabilities [AASB 7 and AASB 132] 1590

AASB 2012–3 Amendments to Australian Accounting Standards – Offsetting Financial Assets and Financial Liabilities [AASB 132] 1597

AASB 2012–4 Amendments to Australian Accounting Standards – Government Loans [AASB 1] 1602

AASB 2012–5 Amendments to Australian Accounting Standards arising from Annual Improvements 2009 – 2011 Cycle [AASB 1, AASB 101, AASB 116, AASB 132 & AASB 134 and Interpretation 2] 1606

AASB 2012–7 Amendments to Australian Accounting Standards arising from Reduced Disclosure Requirements [AASB 7, AASB 12, AASB 101 and AASB 127] 1615 Accounting Standards (AAS)

AAS 25 Financial Reporting by Superannuation Plans 1620

Interpretations

Interpretation 1 Changes in Existing Decommissioning, Restoration and Similar Liabilities 1662

Interpretation 2 Members’ Shares in Co–operative Entities and Similar Instruments 1675

Interpretation 4 Determining whether an Arrangement contains a Lease 1688

Interpretation 5 Rights to Interests arising from Decommissioning, Restorationand Environmental Rehabilitation Funds 1704

Interpretation 6 Liabilities arising from Participating in a Specific Market – Waste Electrical and Electronic Equipment 1714

Interpretation 7 Applying the Restatement Approach under AASB 129

Financial Reporting in Hyperinflationary Economies 1720

Interpretation 9 Reassessment of Embedded Derivatives 1732

Interpretation 10 Interim Financial Reporting and Impairment 1741

Interpretation 12 Service Concession Arrangements 1746

Interpretation 13 Customer Loyalty Programmes 1778

Interpretation 14 AASB 119 – The Limit on a Defined Benefit Asset,

Minimum Funding Requirements and their Interaction 1789

Interpretation 15 Agreements for the Construction of Real Estate 1806

Interpretation 16 Hedges of a Net Investment in a Foreign Operation 1822

Interpretation 17 Distributions of Non–cash Assets to Owners 1840

Interpretation 18 Transfers of Assets from Customers 1855

Interpretation 19 Extinguishing Financial Liabilities with Equity Instruments 1866

Interpretation 20 Stripping Costs in the Production Phase of a Surface Mine 1875

Interpretation 107 Introduction of the Euro 1884

Interpretation 110 Government Assistance – No Specific Relation

to Operating Activities 1888

Interpretation 112 Consolidation – Special Purpose Entities 1891

Interpretation 113 Jointly Controlled Entities – Non–Monetary Contributions by Venturers 1897

Interpretation 115 Operating Leases – Incentives 1901

Interpretation 125 Income Taxes – Changes in the Tax Status of an Entity or its Shareholders 1905

Interpretation 127 Evaluating the Substance of Transactions Involving the Legal Form of a Lease 1908

Interpretation 129 Service Concession Arrangements: Disclosures 1916

Interpretation 131 Revenue – Barter Transactions Involving Advertising Services 1920

Interpretation 132 Intangible Assets – Web Site Costs 1924

Interpretation 1003 Australian Petroleum Resource Rent Tax 1931

Interpretation 1019 The Superannuation Contributions Surcharge 1936

Interpretation 1030 Depreciation of Long–Lived Physical Assets: Condition–Based

Depreciation and Related Methods 1940

Interpretation 1031 Accounting for the Goods and Services Tax (GST) 1945

Interpretation 1038 Contributions by Owners Made to Wholly–Owned

Public Sector Entities 1949

Interpretation 1039 Substantive Enactment of Major Tax Bills in Australia 1961

Interpretation 1042 Subscriber Acquisition Costs in the Telecommunications Industry 1965

Interpretation 1047 Professional Indemnity Claims Liabilities in Medical Defence

Organisations 1971

Interpretation 1052 Tax Consolidation Accounting 1978

Interpretation 1055 Accounting for Road Earthworks 2000

Professional Standards

APES 110 Code of Ethics for Professional Accountants 2005

APES 205 Conformity with Accounting Standards 2102

APES 315 Compilation of Financial Information 2107