How does the AASB set standards and interpretations?

Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 ROHIT SINGH asked almost 3 years ago

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Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 narahari answered almost 3 years ago

to develop a conceptual framework for the purpose of evaluating proposed standards; to make accounting standards under section 334 of the Corporations Act 2001; to formulate accounting standards for other purposes; to participate in and contribute to the development of a single set of accounting standards for worldwide use; and to advance and promote the main objects of Part 12 of the ASIC Act, which include reducing the cost of capital, enabling Australian entities to compete effectively overseas and maintaining investor confidence in the Australian economy.

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Picsjoin 2017224123730582 Archana answered almost 3 years ago

Hie Rohit, The AASB adopts a comprehensive due process to develop pronouncements. It encourages preparers, auditors and users of financial statements to participate in the process, as detailed below. The AASB’s standard-setting process is summarised in a diagram on the website. The due process adopted by the AASB may include the following steps: 1. communicating its views and proposals to a broad range of interested parties via media releases, alerts, publications and other items on its website; 2. inviting public comment on proposed pronouncements via exposure drafts, invitations to comment, proposed interpretations and other open-for-comment documents; 3. meeting with interested parties, including holding roundtable discussions and meeting with its Consultative Group; 4. publishing selected Board papers and discussing technical issues in Board meetings that are open to public observation; 5. publishing Action Alerts following Board meetings and minutes of Board meetings.

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Open uri20170510 32134 1uwcnoc?1494421631 Shubhangi Jain answered almost 3 years ago

The AASB adopts a comprehensive due process to develop pronouncements. It encourages preparers, auditors and users of financial statements to participate in the process, as detailed below. **The AASB’s standard-setting process is summarised in a diagram on the website.** The due process adopted by the AASB may include the following steps: -------------------------------------------------------------------- 1. communicating its views and proposals to a broad range of interested parties via media releases, alerts, publications and other items on its website; 2. inviting public comment on proposed pronouncements via exposure drafts, invitations to comment, proposed interpretations and other open-for-comment documents; 3. meeting with interested parties, including holding roundtable discussions and meeting with its Consultative Group; 4. publishing selected Board papers and discussing technical issues in Board meetings that are open to public observation; 5. publishing Action Alerts following Board meetings and minutes of Board meetings.

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Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 Chirag answered almost 3 years ago

Dear, The Standard-Setting Process AASB Policies and Processes outlines the AASB’s powers and functions and how the AASB goes about its work. The following diagram is a simplified view of the standard-setting process. Each box contains a link to more information. International organisation identifies a technical issue A technical issue may be identified by the International Accounting Standards Board (IASB) or the IFRS Interpretations Committee (IFRIC). Australia has adopted International Financial Reporting Standards (IFRSs) since 1 January 2005, in line with a strategic direction from the Financial Reporting Council. Therefore, issues on the IASB work program and the IFRIC work program are also included on the AASB work program, although the degree of involvement by the AASB varies issue-by-issue and may be substantive or non-substantive. A technical issue may also be identified by the International Public Sector Accounting Standards Board (IPSASB). The AASB closely monitors the IPSASB work program and undertakes work on selected topics, based on their significance to public sector financial reporting in Australia. AASB identifies a technical issue AASB Board members and staff can identify technical issues requiring consideration. Issues identified in relation to for-profit entities are normally referred to the IASB or the IFRIC for consideration. Issues affecting not-for-profit entities in the public and private sectors may be addressed domestically or referred to the IPSASB. Australian organisation/individual identifies a technical issue Australian stakeholders can advise the AASB of issues that in their view should be considered by the AASB or an international standard-setter. For example, issues may be raised in the context of improving the relevance and reliability of financial information or reducing the costs of financial reporting. Add issue to the agenda Once a technical issue has been identified, the AASB will develop a project proposal. A project proposal contains an assessment of the potential benefits of undertaking the project, the costs of not undertaking it, the resources available and the likely timing. The AASB will then review the project proposal and make a decision as to whether the project is worthwhile and should be placed on its agenda (work program). If the Board decides not to add a topic to the agenda, the Board may decide to formally report the decision as a Board Agenda Decision, sometimes called “items not taken onto the agenda” or “agenda rejection statements”. The minutes of meetings record the decisions made and whether or not a formal Board Agenda Decision is issued. Research and consider issue When an issue has been added to the agenda, the AASB will discuss agenda papers developed and presented by AASB staff. The agenda papers address the scope of issues, alternative approaches, and timing of outputs. They may draw upon relevant material from other standard setters, including the IASB, the IPSASB and the New Zealand Accounting Standards Board, or from other organisations. Some issues may be considered jointly with the New Zealand Accounting Standards Board where they are of significance in each country, in order to develop comparable requirements. Consult with stakeholders Once the research has been completed, the AASB makes related documents available for public comment and discussion with stakeholders via one of the following document types. Exposure Drafts (EDs) An exposure draft typically is a draft of a proposed standard (or other pronouncement) or draft amendment to a standard. An ED is likely to include more refined proposals in comparison with Invitations to Comment, Discussion Papers and Consultation Papers. Invitations to Comment (ITCs) Invitations to comment generally seek feedback on broad proposals. An ITC may contain a discussion paper or a consultation paper. Draft Interpretations A draft interpretation is a draft of a proposed interpretation of a standard. Discussion Papers (DPs) These usually outline a wide range of possible accounting policies on a particular topic. Discussion papers, consultation papers and similar documents may be issued by the AASB, the IASB, the IPSASB or other standard setters. The AASB may choose to issue international documents in Australia for comment, perhaps with an Australian preface added to explain the context. The methods the AASB uses to consult with stakeholders may also include the following: Roundtable discussions The AASB may hold formal discussions with a range of stakeholders in connection with proposals issued for comment. Focus Groups The User Focus Group comprises representatives of financial statement users such as investors and investment professionals, equity and credit analysts, credit grantors and rating agencies. This Focus Group enhances the AASB’s consultation with this significant group of users of financial statements. The Not-for-Profit (Private Sector) Focus Group comprises representatives of financial statement preparers, donors, credit grantors and community agencies in that sector. This Focus Group is a key resource for the AASB in addressing NFP issues in the private sector. Project Advisory Panels The AASB may appoint stakeholders to a project advisory panel: a group of people with expertise in a particular topic. Panel members may be asked to provide advice and comments to staff and/or the AASB members as agenda papers are developed to address an issue. Interpretation Advisory Panels The AASB may form Interpretation Advisory Panels as required on a topic-by-topic basis. The role of Panels is limited to preparing alternative views on an issue and, where appropriate, recommendations for consideration by the AASB. Panel membership normally includes preparers, users, auditors and regulators in order to represent a wide range of perspectives. Issue standard or other pronouncement The outcome of the AASB’s consideration of an issue may be the issuance of a pronouncement, such as a standard, an interpretation, or a conceptual framework document. Alternatively, the AASB might decide to address an issue by giving its view on the issue in the minutes of a meeting or in a formal Board Agenda Decision. Pronouncements applicable to for-profit entities will be consistent with International Financial Reporting Standards (IFRSs) issued by the International Accounting Standards Board. This is to ensure that general purpose financial statements prepared by for-profit entities in accordance with AASB standards will also be in accordance with IFRSs. The AASB has a transaction neutrality policy under which similar transactions and events should be accounted for in a similar manner by all types of entities, whether in the for-profit sector, the not-for-profit private sector, or the public sector – unless there is a sound reason to be different in particular circumstances. The AASB considers the specific needs of not-for-profit entities in the private and public sectors when preparing new and revised IFRSs for adoption in Australia. Submissions to international organisations The AASB takes input received from Australian organisations and individuals into account when preparing its submissions to international organisations. The AASB makes formal submissions on documents issued for comment by the IASB and the IPSASB, to contribute to the setting of high-quality international accounting standards. Comments from stakeholders in Australia The AASB requests formal comment letters (submissions) and other input from stakeholders on the AASB’s own proposals and in relation to various consultative documents issued by the IASB and the IPSASB. The AASB considers this input in making submissions to the IASB and the IPSASB and in developing its own pronouncements. Implementation and compliance The AASB monitors implementation of accounting standards and interpretations in Australia. This may lead to revisions to domestic AASB standards or to submissions to the IASB or the IPSASB to propose changes to international standards. Compliance with Australian accounting standards and interpretations is also monitored by other organisations, including: the Australian Securities and Investments Commission (ASIC) the Australian Prudential Regulation Authority (APRA) other Federal, State and Territory Government regulators CPA Australia (CPAA) Chartered Accountants Australia and New Zealand (CAANZ) the Institute of Public Accountants (IPA). The AASB receives feedback from the above organisations that assists in assessing whether amendments to standards are required.

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Open uri20170510 32134 1c996lj?1494421732 Anil answered almost 3 years ago

**The Standard-Setting Process** AASB Policies and Processes outlines the AASB’s powers and functions and how the AASB goes about its work. The following diagram is a simplified view of the standard-setting process. Each box contains a link to more information. **International organisation identifies a technical issue** A technical issue may be identified by the International Accounting Standards Board (IASB) or the IFRS Interpretations Committee (IFRIC). Australia has adopted International Financial Reporting Standards (IFRSs) since 1 January 2005, in line with a strategic direction from the Financial Reporting Council. Therefore, issues on the IASB work program and the IFRIC work program are also included on the AASB work program, although the degree of involvement by the AASB varies issue-by-issue and may be substantive or non-substantive. A technical issue may also be identified by the International Public Sector Accounting Standards Board (IPSASB). The AASB closely monitors the IPSASB work program and undertakes work on selected topics, based on their significance to public sector financial reporting in Australia. **AASB identifies a technical issue** AASB Board members and staff can identify technical issues requiring consideration. Issues identified in relation to for-profit entities are normally referred to the IASB or the IFRIC for consideration. Issues affecting not-for-profit entities in the public and private sectors may be addressed domestically or referred to the IPSASB. **Australian organisation/individual identifies a technical issue** Australian stakeholders can advise the AASB of issues that in their view should be considered by the AASB or an international standard-setter. For example, issues may be raised in the context of improving the relevance and reliability of financial information or reducing the costs of financial reporting. **Add issue to the agenda** Once a technical issue has been identified, the AASB will develop a project proposal. A project proposal contains an assessment of the potential benefits of undertaking the project, the costs of not undertaking it, the resources available and the likely timing. The AASB will then review the project proposal and make a decision as to whether the project is worthwhile and should be placed on its agenda (work program). If the Board decides not to add a topic to the agenda, the Board may decide to formally report the decision as a Board Agenda Decision, sometimes called “items not taken onto the agenda” or “agenda rejection statements”. The minutes of meetings record the decisions made and whether or not a formal Board Agenda Decision is issued. **Research and consider issue** When an issue has been added to the agenda, the AASB will discuss agenda papers developed and presented by AASB staff. The agenda papers address the scope of issues, alternative approaches, and timing of outputs. They may draw upon relevant material from other standard setters, including the IASB, the IPSASB and the New Zealand Accounting Standards Board, or from other organisations. Some issues may be considered jointly with the New Zealand Accounting Standards Board where they are of significance in each country, in order to develop comparable requirements. **Consult with stakeholders** Once the research has been completed, the AASB makes related documents available for public comment and discussion with stakeholders via one of the following document types. Exposure Drafts (EDs) An exposure draft typically is a draft of a proposed standard (or other pronouncement) or draft amendment to a standard. An ED is likely to include more refined proposals in comparison with Invitations to Comment, Discussion Papers and Consultation Papers. Invitations to Comment (ITCs) Invitations to comment generally seek feedback on broad proposals. An ITC may contain a discussion paper or a consultation paper. Draft Interpretations A draft interpretation is a draft of a proposed interpretation of a standard. Discussion Papers (DPs) These usually outline a wide range of possible accounting policies on a particular topic. Discussion papers, consultation papers and similar documents may be issued by the AASB, the IASB, the IPSASB or other standard setters. The AASB may choose to issue international documents in Australia for comment, perhaps with an Australian preface added to explain the context. The methods the AASB uses to consult with stakeholders may also include the following: Roundtable discussions The AASB may hold formal discussions with a range of stakeholders in connection with proposals issued for comment. Focus Groups The User Focus Group comprises representatives of financial statement users such as investors and investment professionals, equity and credit analysts, credit grantors and rating agencies. This Focus Group enhances the AASB’s consultation with this significant group of users of financial statements. The Not-for-Profit (Private Sector) Focus Group comprises representatives of financial statement preparers, donors, credit grantors and community agencies in that sector. This Focus Group is a key resource for the AASB in addressing NFP issues in the private sector. Project Advisory Panels The AASB may appoint stakeholders to a project advisory panel: a group of people with expertise in a particular topic. Panel members may be asked to provide advice and comments to staff and/or the AASB members as agenda papers are developed to address an issue. Interpretation Advisory Panels The AASB may form Interpretation Advisory Panels as required on a topic-by-topic basis. The role of Panels is limited to preparing alternative views on an issue and, where appropriate, recommendations for consideration by the AASB. Panel membership normally includes preparers, users, auditors and regulators in order to represent a wide range of perspectives. **Issue standard or other pronouncement** The outcome of the AASB’s consideration of an issue may be the issuance of a pronouncement, such as a standard, an interpretation, or a conceptual framework document. Alternatively, the AASB might decide to address an issue by giving its view on the issue in the minutes of a meeting or in a formal Board Agenda Decision. Pronouncements applicable to for-profit entities will be consistent with International Financial Reporting Standards (IFRSs) issued by the International Accounting Standards Board. This is to ensure that general purpose financial statements prepared by for-profit entities in accordance with AASB standards will also be in accordance with IFRSs. The AASB has a transaction neutrality policy under which similar transactions and events should be accounted for in a similar manner by all types of entities, whether in the for-profit sector, the not-for-profit private sector, or the public sector – unless there is a sound reason to be different in particular circumstances. The AASB considers the specific needs of not-for-profit entities in the private and public sectors when preparing new and revised IFRSs for adoption in Australia. **Submissions to international organisations** The AASB takes input received from Australian organisations and individuals into account when preparing its submissions to international organisations. The AASB makes formal submissions on documents issued for comment by the IASB and the IPSASB, to contribute to the setting of high-quality international accounting standards. **Comments from stakeholders in Australia** The AASB requests formal comment letters (submissions) and other input from stakeholders on the AASB’s own proposals and in relation to various consultative documents issued by the IASB and the IPSASB. The AASB considers this input in making submissions to the IASB and the IPSASB and in developing its own pronouncements. **Implementation and compliance** The AASB monitors implementation of accounting standards and interpretations in Australia. This may lead to revisions to domestic AASB standards or to submissions to the IASB or the IPSASB to propose changes to international standards. Compliance with Australian accounting standards and interpretations is also monitored by other organisations, including: the Australian Securities and Investments Commission (ASIC) the Australian Prudential Regulation Authority (APRA) other Federal, State and Territory Government regulators CPA Australia (CPAA) Chartered Accountants Australia and New Zealand (CAANZ) the Institute of Public Accountants (IPA). The AASB receives feedback from the above organisations that assists in assessing whether amendments to standards are required.

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