COVID-19: Financial reporting resources

Find the latest COVID-19 financial reporting content from PwC and external sources to help you prepare your financial statements.





Frequently Asked Questions

JobKeeper Program - Presenting amounts received

We intend to participate in the JobKeeper Program.  How should we present the amounts received as reimbursements of the salaries and wages paid to our eligible employees?

The receipts from the JobKeeper Program are accounted for as government grants under AASB 120 Accounting for Government Grants and Disclosures of Government Assistance. These can be presented either as other income or as a reduction of the related employee costs. The presentation approach should be applied consistently to all similar grants.

If you have capitalised the employee expenses to which the JobKeeper payments relate under another accounting standard (eg. as part of property, plant and equipment under construction), then receipts under the Program are accounted for as government grants related to assets under AASB 120. You can present the payments either as (i) deferred income in the balance sheet and amortized over the useful life of the related asset or as (ii) reduction of the carrying amount of the assets resulting in a reduced depreciation expense.

JobKeeper Program - Not-for-profits presenting amounts received

We are a not-for-profit entity and intend to participate in the JobKeeper Program.  How should we present the amounts received as reimbursements of the salaries and wages paid to our eligible employees? 

You should use the provisions in AASB 1058 Income for Not-for-Profit Entities.  The incentive is likely to be accounted for as income under AASB 1058. It needs to be presented as gross income and the related salaries employee expense will be separate.  The option that corporates have of netting the two under AASB 120 is not available.

Raising capital

Companies  might need to raise capital quickly as a result of the impact of COVID-19. What do they need to think about?

In the current circumstances, it’s really important to understand your  financial position, cash flow requirements and the risk of possible covenant breaches.  To mitigate these risks and improve their financial position, some companies may be considering raising additional capital over the next few months. 

ASX-listed companies are permitted to raise capital (eg. by way of rights issue, placement or security purchase plan) without issuing a prospectus or PDS provided certain conditions  in the Corporations Act are met. These are typically known as ‘Low-Doc Offerings’.

A Low-Doc Offering requires a “cleansing statement” that contains specific information, such as information that the company may have withheld from the market on the basis of an exception to its continuous disclosure obligations but which investors and their professional advisers would reasonably require to make an informed decision about whether to subscribe for shares under the capital raising.  While the financial information accompanying a cleansing statement varies from company to company, it typically includes a proforma balance sheet based on the most recent audited/reviewed historical financial information. 

Also, you need to be aware that ASIC and the ASX recently implemented temporary relief to facilitate “emergency” capital raises with the aim of assisting listed companies to raise funds from investors urgently because of the impact of COVID-19 (see ASIC media release and ASX update). This relief will only be available until 2 October 2020 (see ASIC media release 12 June 2020). The ASIC relief has now been extended until 1 January 2021 and the ASX Class Waivers until 30 November 2020.

The ASX has relaxed its restrictions around certain capital raisings (ie. rights offers, placements, share purchase plans), while ASIC has eased their requirements for when ASX-listed companies are permitted to raise capital without issuing a prospectus or Product Disclosure Statement (ie. via a ‘low-doc’ offering).

For more information please contact your PwC Deals team,  Andrew Parker or Rob Silverwood.

ASIC reporting deadline extensions

I’ve heard ASIC has provided further reporting deadline extensions for both listed and unlisted entities that will include June year-ends. Is this true?

Yes. In addition to the extensions already given for December to March year ends, ASIC has extended the deadline for both listed and unlisted entities to lodge financial reports (both full year and half year) by one month. The extended deadlines apply to entities with reporting dates up to and including 7 July 2020.

All entities should continue to consider borrowing covenants or other obligations before using these extended deadlines. The reporting deadlines in ASIC Corporations (Wholly-owned Companies) Instrument 2016/785 will also be extended by one month for balance dates to 7 July 2020.

ASX listed entities are still required to lodge their Appendices 4E (preliminary final reports) and 4D (interim reports) under ASX Listing Rules by the usual due dates. Listed entities are encouraged to continue with the normal practice of lodging the 4E with audited accounts wherever possible to provide the market with the best information possible on a timely basis. This will avoid the need for additional disclosures to the market should there be any changes to the reported results after the 4E has been released and the need to revisit the going concern assumption when the audit opinion is being signed. Similar considerations apply to interim reports. Listed entities must additionally inform the market when they rely on the extended period for lodgement.

See table below for what this means for your reporting deadlines:

Listed entities

Unlisted entities

ASIC reporting deadline extensions - more information

Do I need to do anything before I can rely on the extended lodgement deadlines?

No, based on the relief provided for December year ends we don’t believe you will. The instrument providing the relief for December 2019 - March 2020 year ends does not have any conditions attached and entities do not need to notify ASIC if they wish to rely on the relief. The instrument simply states that entities do not need to comply with the original lodgement deadlines in the Corporations Act 2001 provided they lodge within the new extended lodgement deadlines. We anticipate the instrument for June year ends, which is currently being written, to be similar.

Reporting deadlines under Deed of Cross Guarantee

We are an unlisted company, part of a Deed of Cross Guarantee, and use ASIC's relief for wholly-owned entities to exempt us from lodging our standalone financial statements. Our unlisted parent intends to lodge its 31 December 2019 financial statements by the extended 31 May 2019 deadline, but I've heard this might void our relief and mean we have to lodge our own financial statements. Do you have any more information?

ASIC announced on 13 May the ASIC Corporations (Wholly-owned Companies) Instrument 2016/785 will be extended by one month for balance dates to 7 July 2020. The ASIC wholly-owned entities instrument, as it is currently drafted, requires the parent entity to lodge its financial statements within four months of its year-end, which in theory would mean a breach. However, as announced, ASIC will issue an amendment to extend the deadline to five months. This amendment is expected to be issued by the end of May 2020. Therefore, we expect that provided your parent lodges its financial statements by the extended due dates, you will be in compliance with the ASIC instrument and will not have to lodge your own financial statements.

Contact us

Regina Fikkers

Regina Fikkers

Accounting and Regulatory Leader, PwC Australia

Tel: +61 (2) 8266 8350

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IFRS Communications, PwC Australia

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