ASIC reminds companies of major financial reporting changes

The Australian Securities and Investments Commission (ASIC) has called on companies to comply with the new major accounting requirements that can materially affect reported assets, liabilities, and profits for the incoming ASIC review of financial reports.

Full-year reports at June 30 must comply with new accounting standards on revenue recognition and financial instrument values (including hedge accounting and loan loss provisioning), as well as disclose the future impact of new lease accounting requirements. There are also new standards covering accounting by insurers and the definition and recognition criteria for assets, liabilities, income, and expenses.

“New accounting standards can significantly affect results reported to the market by companies, require changes to systems and processes, and affect businesses,” said ASIC Commissioner John Price.

The corporate watchdog also reminded directors and management to inform investors and other financial report users of the impact of the reported results. Information that there will be no material impact may also be important for the market.

The ASIC review of more than 200 full-year financial reports aimed to promote quality financial reporting, and useful and meaningful information for investors.