2018 Omnibus amendments to Tier 3 and Tier 4 PBE Standards


The New Zealand Accounting Standards Board (NZASB) has published for public comment, proposals to amend the Tier 3 and Tier 4 PBE simple format reporting standards.

We have summarised the proposed changes here for you:

Tier 3 proposed changes

  • Related party transactions are now defined as “a transfer of money or other resource between the reporting entity and a person or other entity that is closely associated with the reporting entity that has the ability to influence the reporting entity. This includes normal business transactions as well as transactions below market price (including the provision of free goods or services).”
  • An entity shall disclose at the bottom of the statement of financial position the date the performance report was approved and authorised for issue and who gave that authorisation
  • Providing guidance on what an entity should do to reverse a prior period impairment
  • The qualitative characteristics of financial reporting have changed to align with the Statement of Concepts. Currently entities must present information in the best way to achieve the following goals: Relevance, Reliability, Comparability and Understandability – this is now Relevance, Faithful representation, Understandability, Timeliness, Comparability, Verifiability. This enhances considerations
  • Grants that are service contracts which have a “use or return” condition attached are now recorded as Revenue from providing goods or services; previously in the table they were listed as Donations, fundraising and other similar revenue.

Tier 4 proposed changes

  • Permitting that where an entity controls another entity (or entities) and the total combined operating payments of the group are within the statutory threshold to apply the Tier 4 standards, the controlling entity is not required to prepare consolidated financial statements
  • An entity shall disclose at the bottom of the statement of receipts and payments the date the performance report was approved and authorised for issue and who gave that authorisation
  • Definition of related party transactions has been amended as per Tier 3’s amendment.

If you have any questions relating to these changes, please get in touch.

Published winter 2018.

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