Post by InCorp Advisory Australia

AASB 18 is being described as the most significant change to financial statement presentation in over two decades. If your team hasn't started preparing, now is the time. In his latest piece, Partner, Audit & Assurance, Graham Webb, breaks down what AASB 18 means for how entities structure, label and explain their financial statements, and what preparers need to do before it takes effect. Key reminders from the article: 𝗧𝗵𝗲 𝘀𝘁𝗮𝘁𝗲𝗺𝗲𝗻𝘁 𝗼𝗳 𝗽𝗿𝗼𝗳𝗶𝘁 𝗼𝗿 𝗹𝗼𝘀𝘀 𝗴𝗲𝘁𝘀 𝗮 𝗻𝗲𝘄 𝘀𝘁𝗿𝘂𝗰𝘁𝘂𝗿𝗲: Income and expenses must now be categorised as operating, investing or financing, with two new mandatory subtotals introduced 𝗠𝗣𝗠𝘀 𝗹𝗶𝗸𝗲 𝗘𝗕𝗜𝗧𝗗𝗔 𝗰𝗮𝗻𝗻𝗼𝘁 𝘀𝘁𝗮𝗻𝗱 𝗮𝗹𝗼𝗻𝗲: Management-defined performance measures will require reconciliation to an AASB-defined subtotal, a clear methodology and an explanation of why the measure reflects management's view 𝗔𝗴𝗴𝗿𝗲𝗴𝗮𝘁𝗶𝗼𝗻 𝗿𝘂𝗹𝗲𝘀 𝗮𝗿𝗲 𝘁𝗶𝗴𝗵𝘁𝗲𝗻𝗶𝗻𝗴: The days of burying line items in vague "other" categories are largely over, with new guidance on when items must be separately disclosed 𝗦𝘆𝘀𝘁𝗲𝗺𝘀 𝗮𝗻𝗱 𝗽𝗿𝗼𝗰𝗲𝘀𝘀𝗲𝘀 𝘄𝗶𝗹𝗹 𝗻𝗲𝗲𝗱 𝘁𝗼 𝗰𝗵𝗮𝗻𝗴𝗲: Entities may need to remap their chart of accounts, update reporting systems and reassess how performance metrics are calculated and communicated For profit entities need to be ready for periods beginning on or after 1 January 2027. Retrospective application is required, so the comparative period work starts sooner than many teams realise. Read it here: https://lnkd.in/gA3jxNUq