Note 1. Summary of significant accounting policies (continued) Applicable for Standard / annual reporting Impact on public Summary Interpretation periods beginning sector entity financial or ending on statements The assessment has AASB 9 The key changes include 1 January 2018 identified that the financial Financial the simplified requirements Instruments for the classification and impact of available for sale measurement of financial (AFS) assets will now be assets, a new hedging reported through other accounting model and a comprehensive income revised impairment loss (OCI) and no longer model to recognise recycled to the profit and impairment losses earlier, loss. as opposed to the current approach that recognises While the preliminary impairment only when assessment has not incurred. identified any material impact arising from AASB 9, it will continue to be monitored and assessed. The changes in revenue AASB 15 The core principle of AASB 1 January 2017 recognition requirements Revenue from 15 requires an entity to (Exposure Draft Contracts with recognise revenue when in AASB 15 may result in 263 potential – Customers the entity satisfies a changes to the timing and deferral to 1 performance obligation by amount of revenue January 2018) transferring a promised recorded in the financial good or service to a statements. The Standard customer. will also require additional disclosures on service revenue and contract modifications. A potential impact will be the upfront recognition of revenue from licenses that cover multiple reporting periods. Revenue that was deferred and amortised over a period may now need to be recognised immediately as a transitional adjustment against the opening retained earnings if there are no former performance obligations outstanding.
Note 1. Summary of significant accounting policies (continued) Standard / Interpretation Summary Applicable for annual reporting periods beginning or ending on Impact on public sector entity financial statements AASB 9 Financial Instruments The key changes include the simplified requirements for the classification and measurement of financial assets, a new hedging accounting model and a revised impairment loss model to recognise impairment losses earlier, as opposed to the current approach that recognises impairment only when incurred. 1 January 2018 The assessment has identified that the financial impact of available for sale (AFS) assets will now be reported through other comprehensive income (OCI) and no longer recycled to the profit and loss. While the preliminary assessment has not identified any material impact arising from AASB 9, it will continue to be monitored and assessed. AASB 15 Revenue from Contracts with Customers The core principle of AASB 15 requires an entity to recognise revenue when the entity satisfies a performance obligation by transferring a promised good or service to a customer. 1 January 2017 (Exposure Draft 263 – potential deferral to 1 January 2018) The changes in revenue recognition requirements in AASB 15 may result in changes to the timing and amount of revenue recorded in the financial statements. The Standard will also require additional disclosures on service revenue and contract modifications. A potential impact will be the upfront recognition of revenue from licenses that cover multiple reporting periods. Revenue that was deferred and amortised over a period may now need to be recognised immediately as a transitional adjustment against the opening retained earnings if there are no former performance obligations outstanding.
vla-annual-report-2015-16-accessible-version.docx