Accounting Standard AASB 2023-3 Amendments to Australian Accounting Standards – Disclosure of Non-current Liabilities with Covenants: Tier 2 (Cth)

AASB Standard AASB 2023-3 June 2023

Amendments to Australian Accounting Standards – Disclosure of Non-current Liabilities with Covenants: Tier 2 [AASB 1060]

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ISSN 1036-4803

Contents

PREFACE ACCOUNTING STANDARD AASB 2023-3 AMENDMENTS TO AUSTRALIAN ACCOUNTING STANDARDS – Disclosure of Non‑current liabilities with covenants: Tier 2

from paragraph OBJECTIVE 1 APPLICATION 2 AMENDMENTS TO AASB 1060 5 COMMENCEMENT OF THE LEGISLATIVE INSTRUMENT 6

BASIS FOR CONCLUSIONS

Australian Accounting Standard AASB 2023-3 Amendments to Australian Accounting Standards – Disclosure of Non-current Liabilities with Covenants: Tier 2 is set out in paragraphs 1–6. All the paragraphs have equal authority.

Preface

Standards amended by AASB 2023-3 This Standard makes amendments to AASB 1060 General Purpose Financial Statements – Simplified Disclosures for For-Profit and Not-for-Profit Tier 2 Entities (March 2020).

Main features of this Standard

Main requirements AASB 2020-1 Amendments to Australian Accounting Standards – Classification of Liabilities as Current or Non-Current and AASB 2022-6 Amendments to Australian Accounting Standards – Non-current Liabilities with Covenants amended AASB 101 Presentation of Financial Statements to improve the information an entity provides in its financial statements about liabilities arising from loan arrangements for which the entity's right to defer settlement of those liabilities for at least twelve months after the reporting period is subject to the entity complying with conditions specified in the loan arrangement (often referred to as 'covenants'). Consistent with the amendments made by AASB 2020-1 and AASB 2022-6 for Tier 1 reporting requirements, this Standard amends AASB 1060 to: (a) clarify that a liability is classified as non-current if an entity has the right at the reporting date to defer settlement of the liability for at least twelve months after the reporting date; (b) clarify the reference to settlement of a liability by the issue of equity instruments in classifying liabilities; and (c) require the disclosure of information that enables users of the financial statements to understand the risk that non-current liabilities with covenants could become repayable within twelve months.