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In recent years, there has been an increased use of supplier financing (or reverse factoring) arrangements (SFAs) which provide companies with solutions for managing working capital. As the use of these solutions expands, it has become increasingly important that investors have transparency over the effect on a company’s liabilities, cash flows and exposure to liquidity risk.
Starting in 2024, IFRS® reporters will be required to provide additional disclosures about these arrangements to fulfil those investor needs. Our In depth tells you what you need to know to account for supplier finance arrangements, and what information you need to start collecting to be ready for the new disclosure requirements.
Guide for June 2023 reporting season
This document highlights the key areas that might impact companies for this June year-end reporting season. It summarises the areas of focus for ASIC, general hot topics in the market, accounting changes from standard setting and other regulatory changes.
Financial reporting for entities participating in the voluntary carbon market
Many entities are voluntarily choosing to purchase carbon offsets or credits as a method of ‘offsetting’ or ‘reducing’ the net emissions from their everyday activities, such as emissions arising from manufacturing, cloud services, transportation and energy usage. Carbonoffsets or credits purchased by companies might be reported as an offset to those emissions, or used to support statements that a company’s products can be labelled as ‘carbon-neutral’.
There are no accounting standards or IFRS interpretations that directly address the accounting for carbon offsets and related projects. In this In depth we address the key accounting considerations for the various counterparties that are participating in the voluntary carbon market.
There is also a podcast where Claire Howells and Gina Huang join Raihazah Shaikh to share their perspectives on the accounting for carbon offsets and related costs from the perspective of a purchaser and the perspective of a project developer.
AASB 17 Insurance Contracts will replace AASB 4 Insurance Contracts, AASB 1023 General Insurance Contracts and AASB 1038 Life Insurance Contracts for annual periods beginning on or after 1 January 2023. AASB 17 will fundamentally change the accounting for insurance contracts within the scope of the standard. It will require the use of consistent measurement models based on current assumptions at a more granular level.
Accounting impacts of rising inflation
In an environment of rising inflation, often accompanied by rising interest rates, the challenges that an entity faces can have a wide-reaching effect on the financial statements and need to be considered when applying many of the IFRS requirements.
In our in depth we walk you through key areas of the IFRS requirements that could be most impacted by rising inflation and interest rates.
See this report for further details.
Investors and regulators are increasingly focusing on the impact of climate change and broader environmental, social and governance (ESG) matters on the financial statements. We have a number of publications that will help you assessing what impact these matters may have and what disclosures you may need to make:
Regulators and standard-setting bodies are responding to the stakeholder needs of credible and trusted environmental, social and governance (ESG) disclosures, and we are seeing rapid change in the ESG landscape with likely mandatory requirements in the near future.
The International Sustainability Standards Board (ISSB) has recently released their first two sustainability standards - see our In depth publication for practical guidance and insight on these standards. For insights and guidance on all three sustainability reporting frameworks (IFRS® Sustainability Disclosure Standards, European Sustainability Reporting Standards and the SEC’s proposed climate rule), see our In depth Navigating sustainability reporting: Practical application and analysis.
As ASIC is encouraging companies to voluntarily apply the reporting recommendations from the Task Force for Climate-related Financial Disclosures (TCFD), our publication ‘Task Force for Climate-related Financial Disclosures (TCFD) - Where do I start may also be of interest.
For other information see our dedicated ESG page on Viewpoint.
Partner - Capital Markets, Accounting Advisory and Structuring, PwC Australia
Tel: +61 2 8266 4664
Partner, Accounting Consulting Services, PwC Australia
Tel: +61 419 713 218