Chapter 13
Reports and Disclosures I:
Overview
Lecture Topics
• Legislative requirements
• Content of annual financial reports
Lecture References
• Text
- Chapter 13
• AASBs - 1034
- 1018
- 1004
- 1026
• Corporations Act (part 2M)
Key Concepts
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Disclosure
Annual report
Presentation
Disclosure
Legislative Requirements
• Corporations Act (part 2M)
– Reports produced
– Timing of reports
– Minimum content
Legislative Requirements
• Applies to:
– Disclosing entities
– Public companies
– Large proprietary companies
– Managed investment schemes
– Some small proprietary companies
Legislative Requirements
• Regulation of financial reporting
• Reports Required
– Financial statements
– Director’s declaration
– Auditor’s report
– Director’s report
• Lodgement with ASIC
Legislative Requirements
• Classification of entities
– Disclosing entity
– Public company
– Large proprietary company
– Small proprietary company
– Managed investment schemes
– Reporting entity
Legislative Requirements
• Timing of reports
– Reporting lag
– Length of reporting period
– Reporting frequency
Legislative Requirements
• Reporting to regulators
– Lodgement with ASIC
– Stock Exchange requirements
• Record-keeping requirements
– “True and fair”
Content of Annual Financial Reports
• Core disclosure standards
– AASBs 1034, 1018, 1040 and 1026
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scope
recognised vs disclosed
role of notes
presentation vs disclosure
Content of Annual Financial Reports
• AASB 1034: The disclosure framework
– General requirements
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consistency of presentation
notes to financial statements
specific non-financial disclosures
other note disclosures
comparative information
Content of Annual Financial Reports
• Directors’ declaration
– Part of annual financial report
– Financial statements and notes comply with
stds
– Give a ‘true and fair’ view
– Entity able to pay debts
– Comply with the law
Content of Annual Financial Reports
• Other standards controlling general
disclosure
– AASB 1031: Materiality
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separate vs aggregate disclosure
policy disclosure
assessment criteria
definition
user needs focus
Content of Annual Financial Reports
• Other standards controlling general
disclosure
– AASB 1001: Accounting policies
• policy choice
• general disclosures
• changes in accounting policy
Content of Annual Financial Reports
• Other standards controlling general
disclosure
– AASB 1002: events occurring after reporting
date
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required disclosures
type 1 and 2 events
applying AASB 1002 and cut-off issues
setting-off prohibited
Other Reports
• Annual directors’ report
– General information
– Specific information
– Special rules
• public companies
• listed companies and schemes
• registered schemes
Other Reports
• Auditor’s report
– Audit and the annual report
– Form an opinion
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in accordance with the Act and AASBs
true and fair view
received all necessary information
financial records properly kept
records required by the Act kept
Reporting Obligations of
Non-reporting Entities
– Preparation of annual report (other than small
proprietary companies)
• financial report
• directors’ report and declaration
– Copies of annual report sent to members
– AGM for public companies
– Annual report lodged with ASIC
Where to get more information
• Other courses
• List books, articles, electronic sources