Independent Review – Australian Accounting Standards Board
On 19 July 2017, the Australian Accounting Standards Board (AASB) approved AASB 17 Insurance Contracts. When first approved by the AASB, the Standard applied to periods beginning on or after 1 January 2021. As a result of amendments made in July 2020 through AASB 2020-5 Amendments to Australian Accounting Standards – Insurance Contracts, AASB 17 was deferred and now applies to periods beginning on or after 1 January 2023. Earlier application is permitted.
AASB 17 Insurance Contracts establishes principles for the recognition, measurement, presentation and disclosure of insurance contracts within the scope of the Standard. The objective of AASB 17 is to ensure that an entity provides relevant information that faithfully represents those contracts. This information gives a basis for users of financial statements to assess the effect that insurance contracts have on the entity’s financial position, financial performance and cash flows.
Consistent with the Government’s Regulation Impact Statement (RIS) requirements, the AASB certified that the process and analysis undertaken by both the International Accounting Standards Board (IASB) and the AASB is equivalent to a Regulation Impact Statement (RIS) as documented in the following:
- IASB’s Basis for Conclusions to IFRS 17;
- IASB’s Effects Analysis accompanying IFRS 17; and
- AASB’s additional Australian Basis for Conclusions to AASB 17.
The Office of Best Practice Regulation (OBPR) does not assess the quality of independent reviews and RIS-like documents used in lieu of a RIS.
The AASB estimated the average annual regulatory cost at $44.4 million. Prior to March 2020, regulatory costs over $2 million had to be quantified and agreed with OBPR. The OBPR agreed to the regulatory costs for this proposal on 28 June 2017.
The AASB certified reports are available from the IASB support materials page (see the AASB 17 row) on the AASB website. The AASB’s Basis for Conclusions accompanies AASB 17 and is attached below.
Please note, any accessibility queries should be directed to the AASB.