In our December 2020 newsletter, we advised that for-profit private sector entities currently producing special purpose financial statements (SPFS) will have to prepare general purpose financial statements (GPFS) from 1 July 2021 (ie for years ending 30 June 2022).
GPFS will be required for all for-profit private sector entities that:
- are required to prepare financial statements in accordance with Australian Accounting Standards by legislation (ie the Corporations Act), or
- where the constitution or other key documents (eg bank loan agreement) require the preparation of financial statements in accordance with Australian Accounting Standards, when such documents were created or amended on or after 1 July 2021.
The changes mean it is likely that a number of types of for-profit entities will need to prepare GPFS including:
- unlisted public companies
- large proprietary companies (including grandfathered entities)
- AFSL licensees
- small proprietary companies that have raised funding via crowd sourcing:
The framework has been further enhanced with a Simplified Disclosure regime which allows certain entities to adopt GPFS with less onerous disclosures than those of full GPFS.
Furthermore, as part of the changes, there are important transitional reliefs available for entities early adopting the new standards that could save significant time in the preparation of the GPFS.
Over the coming months, we will be providing further detailed guidance on how to prepare yourself for the changes.
If you require assistance with your transition to the new GPFS regime, please contact your client manager at KSW.
Kreston Stanley Williamson Team
*Correct as of February 2021
*Disclaimer – this article has been produced by Kreston Stanley Williamson as a service to its clients and associates. The information contained in the article is of general comment only and is not intended to be advice on any particular matter. Before acting on any areas contained in this article, it is imperative you seek specific advice relating to your particular circumstances. Liability limited by a scheme approved under professional standards legislation.