Beyond the numbers | Edition 1 2025
Nexia Edwards Marshall
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Welcome to the premier edition of Beyond the Numbers for 2025. Our monthly newsletter provides a summary of the latest developments from domestic and global standard-setting bodies and regulatory authorities.
AML/CTF rules extend to accountants
The Anti-Money Laundering and Counter-Terrorism Financing Amendment Act 2024 (the Act) received Royal Assent on 10 December 2024.
The Act extends the Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) regime to include services provided by real estate professionals, dealers in precious metals and stones, and professional service providers including accountants, legal practitioners, conveyancers, professional trustees and company secretarial services.
Relevant accountants’ services include:
The amendments are effective from 31 March 2026.
The Impact Analysis prepared by the Attorney-General’s Department noted that the estimated total upfront and ongoing annual regulatory cost on the accounting services industry will be $562 million and $245 million, respectively. The government expects the additional compliance costs to be passed on to consumers.
CA ANZ’s financial reporting guides – December 2024
Chartered Accountants Australia and New Zealand (CA ANZ) has released its December 2024 financial reporting publication for both Australia and New Zealand. The guides cover newly effective standards and amendments, as well as those yet to be mandatory.
Key topics include presentation and disclosure in financial statements, Not-for-profit (NFP) reporting, impacts of tax legislation, climate-related disclosures, and regulator’s focus areas.
The publications are available for CA ANZ members to access and download from their website.
The end of Special Purpose Financial Statements for not-for-profit entities
The AASB released two Exposure Drafts to significantly alter the financial reporting framework for NFP entities:
ED 334 proposes to remove the ‘reporting entity’ concept currently applied by many NFP entities and require general purpose financial statements where a NFP is required:
This change would affect large and medium-sized charities registered with the ACNC and many incorporated associations, co-operatives and other NFP entities.
ED 335 proposes a new simplified Tier 3 general purpose financial statements framework for smaller private sector NFP entities. The new framework aims to simplify many of the recognition, measurement, and disclosure requirements compared to both Tier 1 and Tier 2 general purpose financial statements.
NFP stakeholders can get involved by completing an online survey for:
or visit the AASB website.
Both Exposure Drafts are open for public comment until 28 February 2025.
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Department of Treasury and Finance – Victoria
The Department of Treasury and Finance (DTF) has released its December 2024 Accounting Policy Update, highlighting key developments for Victorian public sector entities:
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ASIC financial reporting focus areas for December 2024
ASIC has released its focus areas for the December 2024 financial reporting season, which are largely consistent with those for June 2024.
The enduring focus areas are:
In addition, ASIC’s particular focus areas are previously ‘grandfathered’ large proprietary companies and registrable superannuation entities.
Finally, ASIC reminded public companies of the new consolidated entity disclosure statement.
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Treasury seeks feedback on merging three financial reporting bodies
Australia’s financial reporting landscape is currently overseen by three bodies: the Financial Reporting Council (FRC), the Australian Accounting Standards Board (AASB), and the Auditing and Assurance Standards Board (AUASB).
The government is proposing to merge these bodies to create a single entity responsible for overseeing and setting standards for accounting, auditing and climate-related disclosures.
Furthermore, it is proposed that the functions and powers relating to the FRC’s oversight of the AASB and AUASB will form part of the new body’s internal management.
The new body is intended to be operational on or after 1 July 2026, subject to the passage of legislation.
Responses to Treasury’s consultation paper are due by 21 February 2025.
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ASIC | Key issues for 2025
ASIC has identified several key issues it will focus on in 2025, including:
These key issues will drive ASIC’s strategic and operational activities outlined in its Corporate Plan for 2024-25.
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ISSB provides further guidelines – proportionality mechanisms – to sustainability reporting
The International Sustainability Standards Board (ISSB) recently hosted a webcast discussing proportionality mechanisms within IFRS S1 and IFRS S2. These mechanisms help companies, especially smaller ones, meet disclosure requirements based on their size and resources. The three-part webcast covers:
This can be accessed from the IFRS website or YouTube channel.
ISSB update and podcast – November 2024
The ISSB released its latest podcast episode covering global progress towards climate-related disclosures and its recent education material on sustainability-related risks and opportunities.
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Bridging financial statements and sustainability-related disclosures
The International Accounting Standards Board (IASB) released its new webcast series emphasising the connectivity between financial statement and sustainability-related financial information.
Relationships such as climate-related risks and impairment of non-financial assets, climate-related opportunities and changes in product mix, and climate-related commitments were briefly covered through high-level examples.
The webcast series can be accessed from the IFRS website or YouTube channel.
Power purchase agreement | Amendment to IFRS Standards
The International Accounting Standards Board (IASB) amended IFRS 9 Financial Instruments and IFRS 7 Financial Instruments: Disclosures to improve the accounting and measurement of nature-dependent electricity contracts. These contracts enable businesses to procure electricity directly from renewable energy sources, where output varies due to natural conditions.
Key changes to the IFRS Standards include:
These amendments apply for annual reporting periods beginning on or after 1 January 2026, with early adoption permitted.
The Nature-dependent Electricity Contracts amendments are currently available exclusively to premium IFRS.org subscribers. However, these amendments will soon be integrated into the 2025 consolidated IFRS Accounting Standards, at which point all registered users will have access.
IASB proposed amendments to IAS 37 Provisions, Contingent Liabilities and Contingent Assets
The IASB proposes amendments to IAS 37?Provisions, Contingent Liabilities and Contingent Assets?to clarify how companies assess when to record provisions and how to measure them. The amendments would also require companies to provide more information about the measurement of provisions.
The proposed amendments aim to:
The amendments would also result in the withdrawal of IFRIC Interpretation 6?Liabilities arising from Participating in a Specific Market – Waste Electrical and Electronic Equipment?and Interpretation 21?Levies.
Depending on an entity’s existing accounting policies, the IASB’s proposals may result in larger provisions.
The comment period on the IASB exposure draft is open until 12 March 2025.
IFRIC Meeting – November 2024
The IFRS Interpretations Committee (IFRIC) last met on 26 November 2024.
During the meeting, IFRIC finalised its agenda decision regarding the classification of cash flows related to variation margin calls on ‘collateralised-to-market’ contracts. If the IASB does not object to the agenda decision, it will be published in February 2025.
Other tentative decisions by IFRIC include:
Application of IAS 29 Financial Reporting in Hyperinflationary Economies in assessing indicators of hyperinflationary economies – IFRIC concluded that there is little diversity in understanding the requirements for assessing when an economy becomes hyperinflationary and decided not to add a standard-setting project to its work plan. Recognition of intangible assets arising from climate-related commitments – Given that the IASB has a project on pollutant pricing mechanisms (PPMs) on its reserve list, some of which involve carbon credits, IFRIC decided not to add a separate standard-setting project on the accounting for carbon credits. IFRIC’s podcast in relation to the above matters can be accessed through the IFRS website.
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IASB Board Meeting – December 2024
The IASB met on the 9th and 11th of December 2024 to discuss targeted refinements to its proposals for inclusion in an exposure draft of IFRS Practice Statement 1 Management Commentary. The Board decided to proceed with issuing the revised Practice Statement without re-exposing its proposals.
The Board also considered stakeholder feedback on proposed amendments to IFRS 3 Business Combinations in the Exposure Draft Business Combinations—Disclosures, Goodwill and Impairment. No decisions were made, and deliberations will continue in future meetings.
A podcast episode discussing the highlights of this meeting is available on the IFRS website.
IFRS Foundation releases sustainability risk guide
The IFRS Foundation released a new comprehensive guide to assist organisations in identifying and disclosing material sustainability-related risks and opportunities.
The guide focuses on how these risks and opportunities can arise from a company’s dependencies and impacts on various resources and relationships such as human, intellectual, financial, natural, manufactured and social resources across its value chain.
It also provides practical guidance on using a materiality assessment process, similar to that used for financial reporting, to identify and disclose relevant sustainability information.
The material contained in this publication is for general information purposes only and does not constitute professional advice or recommendation from Nexia Edwards Marshall. Regarding any situation or circumstance, specific professional advice should be sought on any particular matter by contacting your Nexia Edwards Marshall Advisor.