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Australian Accounting Standards Board—Report for 2015-16


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Australian Accounting Standards Board

Annual Report 2015-16

 Commonwealth of Australia 2016

ISSN 2204-4221 (Print) ISSN 2204-423X (Online)

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Media Liaison AASB Podium Level Level 14 / 530 Collins Street MELBOURNE 3000 Email: standard@aasb.gov.au

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LETTER OF TRANSMITTAL

7 October 2016

The Hon Kelly O’Dwyer MP Minister for Revenue and Financial Services Parliament House CANBERRA ACT 2600

Dear Minister,

I have pleasure in presenting the annual report of the Australian Accounting Standards Board (AASB) and the Office of the Australian Accounting Standards Board for the year ended 30 June 2016.

The report has been prepared in accordance with the Public Governance, Performance and Accountability Act 2013 (PGPA Act).

Section 46 of the PGPA Act requires me to prepare a report of the operations of the AASB and the Office of the AASB during the year. The report must be tabled in each House of the Parliament as soon as practicable.

Yours sincerely

Kris Peach Chair, Australian Accounting Standards Board

Page iv

CONTENTS

ABBREVIATIONS ................................................................................................. V

CHAIR’S REVIEW ................................................................................................ 7

WHAT DID THE AASB DO 2015-16?.................................................................. 11

Mission of the AASB ..................................................................................................... 11

Report on Performance Portfolio Outcome ................................................................... 11

MANAGEMENT AND ACCOUNTABILITY ................................................................ 27

How the AASB works .................................................................................................... 27

The Minister ............................................................................................................. 27

Financial Reporting Council ..................................................................................... 28

AASB ........................................................................................................................ 28

Office of the AASB ................................................................................................... 28

Membership ............................................................................................................. 28

Observers ................................................................................................................. 29

AASB’s corporate governance ...................................................................................... 29

Audit Committee ....................................................................................................... 29

Fraud ........................................................................................................................ 30

Ethics........................................................................................................................ 30

Management of personnel ............................................................................................ 31

FINANCIAL REPORT .......................................................................................... 33

STATEMENT BY THE CHAIR AND FINANCE MANAGER .......................................... 36

APPENDICES .................................................................................................... 61

Appendix A AASB legislative requirements ................................................................. 63

Appendix B Attendance at AASB meetings ................................................................. 64

Appendix C Other information ...................................................................................... 65

Appendix D Agency resource statement and resources for outcomes ........................ 68 Appendix E List of Requirements ................................................................................. 69

Appendix F Index ......................................................................................................... 75

Page v

ABBREVIATIONS

The following abbreviations are used in this report:

AASB Australian Accounting Standards Board ACNC Australian Charities and Not-for-profits Commission ANAO Australian National Audit Office AOSSG Asian-Oceanian Standard-Setters Group ASAF Accounting Standards Advisory Forum ASIC Australian Securities and Investments Commission ASIC Act Australian Securities and Investments Commission Act 2001 AUASB Auditing and Assurance Standards Board FRC Financial Reporting Council

GPFS General Purpose Financial Statements GST Goods and services tax

IAS International Accounting Standards

IASB International Accounting Standards Board IFASS International Forum of Accounting Standard Setters (formerly NSS) IFRS International Financial Reporting Standards IPSAS International Public Sector Accounting Standard IPSASB International Public Sector Accounting Standards Board IVSC International Valuation Standards Council KASB Korea Accounting Standards Board NFP Not-for-Profit

NZASB New Zealand Accounting Standards Board PGPA Act Public Governance, Performance and Accountability Act 2013 PSA Public Service Act 1999

RDR Reduced disclosure requirements SME Small and Medium Enterprises

Page vi

CONTACT DETAILS

Chair Australian Accounting Standards Board

Street Address: Podium Level Level 14, 530 Collins Street MELBOURNE VIC 3000

Postal Address: PO Box 204 Collins Street West Victoria 8007

Tel: 03 9617 7600

Email: standard@aasb.gov.au Web: www.aasb.gov.au

Internet homepage: http://www.aasb.gov.au

LinkedIn - https://www.linkedin.com/company/aasb Twitter - https://twitter.com/AASBaustralia

Annual report location: http://www.aasb.gov.au/About-the-AASB/AASB-annual-reports.aspx

Page 7

CHAIR’S REVIEW

OUR PERFORMANCE IN 2016

This year has been one of significant change for the Australian Accounting Standards Board (AASB). The AASB has made good progress on our five strategies (as outlined in the Annual Performance Statement on page 13 of this report). These strategies underpin our day-to-day operations and help us to deliver high-quality standards that meet the needs of the Australian community.

At the same time, the AASB has also achieved some important milestones in positioning ourselves to better meet the current and future challenges facing Australia. These challenges, and the steps the AASB is taking to address them, are outlined below.

TOWARDS A STRONGER FINANCIAL REPORTING FRAMEWORK

The AASB has commenced a comprehensive outreach campaign to better understand what our constituents want and need from Australia’s financial reporting framework. This has identified some important issues:

 Our financial reporting framework is too complicated and subjective. The AASB must continue working with regulators to identify objective criteria that determine who should prepare and lodge general purpose financial statements. The AASB has made progress in benchmarking against our international counterparts. However this project will be a key focus for 2016/17.

 IFRS is not a perfect solution, but there is no preferred alternative accepted by all. IPSASB is not preferred by the public or private not-for-profit sectors. The AASB’s principle of transaction neutrality across all sectors, based on IFRS, has a key benefit of enabling users and preparers to move freely between sectors, and to move internationally. However, there is a need for more sector-specific guidance, particularly in the not-for-profit private sector, and simpler reporting requirements for small not-for-profit entities. In response to these concerns, the AASB will be releasing a new standard in December 2016 on income for not-for-profits, which will address many of the long standing concerns about revenue recognition in this sector. The AASB will continue liaising with the Australian Charities and Not-for-profits Commission (ACNC) and others to continue to improve reporting for not-for-profit organisations.

 General purpose financial reports are too complicated and have too much detail. Some key initiatives of the AASB and IASB to address these concerns are progressing well. The AASB will be proposing revised Tier 2 Reduced Disclosure Requirements, in

Australian Accounting Standards Board Annual Report 2015-16

Page 8

conjunction with New Zealand, in the fourth quarter of 2016. The AASB and the Australian Securities Investments Commission (ASIC) have been very supportive of entities that have exercised their judgement to remove unnecessary disclosures. The IASB is also working on setting out the principles of disclosure, addressing concerns about reporting of underlying earnings and avoiding disclosure overload arising from specific standards. The AASB will continue to support initiatives from the IASB and elsewhere that improve external reporting.

 Accounting standards are hard to interpret and apply. Our joint project with the Korea Accounting Standards Board highlighted the importance of clear and concise language in standards, and identified several areas where standards used inconsistent and difficult to interpret terminology. Encouragingly, the IASB has been receptive to our recommendations for improving consistency and clarity.

AN ONGOING DIALOGUE

None of these issues can be solved by any of us alone. Each requires cooperation and perseverance from many interested stakeholders and regulators. Over the past two years, the AASB has significantly improved its stakeholder engagement program but also - perhaps more importantly - encouraged an open and consultative approach and welcomes feedback from whatever channel it arrives.

On this front, it was very pleasing to note the success of our education sessions, new forums for the not-for-profit private sector and for accounting firms, and the Project Advisory Panels. I was particularly excited about co-hosting events with the Australian Institute of Company Directors (AICD), Chartered Accountants Australia and New Zealand (CAANZ) and CPA Australia, as this considerably broadened the range of feedback the AASB received. The excellent participation at our roundtables, particularly those involving IASB representatives such as Ian Mackintosh and Sue Lloyd, also contributed to our international influence.

Our social media presence now covers over 3,000 LinkedIn (www.linkedin.com/company/aasb) and 600 Twitter (twitter.com/AASBaustralia) followers. While formal written submissions are appreciated, the AASB is more concerned about getting feedback, not the form in which it is presented.

More importantly, feedback is enabling us to influence international developments. Whilst not always successful, the IASB hears and understands our views, through our role on the IASB’s premier advisory body, the Accounting Standards Advisory Forum (ASAF) and our relationships with the IASB board members and staff, and through our involvement with the Asian-Oceanian Standards-Setters Group (AOSSG).

The AASB is very pleased to report that the IASB is acting on the recommendations of our joint research report with the Korea Accounting Standards Board (KASB). Feedback from 208 Australian preparers and auditors enabled us to highlight issues with consistency or interpreting terms of likelihood, such as probable. As a result, the IASB is going to reduce the number of terms used and rank them, on a go forward basis. The joint research report can be accessed from the AASB website.

Chair’s Review

Page 9

ENSURING THE AASB REMAINS FIT-FOR-PURPOSE

Technological advances, the rise in importance of non-financial reporting, stakeholder demands for clearer and more frequent information, the growing importance of international alliances with other standard-setters and the need for better empirical evidence to effectively influence international developments, all pose potentially significant challenges and opportunities for the AASB. To meet these challenges, the AASB and AUASB recognise they will need to be more agile and responsive.

This year, the AASB and AUASB undertook a major restructure as part of a broader strategy to ensure Australia remains at the forefront of international accounting and auditing practice and that standards are ‘fit for purpose’ in the Australian environment.

The Boards have moved to a shared support model, where both Boards will be supported by a single National Director and combined administrative staff. The changes to the Boards’ operating model are being supported by changes in systems and processes, particularly those regarding accountability, training and employee development. These changes will enable the Boards to collaborate and influence more effectively, and more cost-effectively set standards (Further detail is set out in Note 1.13 to the Financial Statements).

FINANCIAL RESULTS

The AASB has recognised a Total Comprehensive Deficit of $1,349,774 (2015: $517,485), and a Deficit of $1,287,527 (2015: $295,485) as a result of exceeding its budgetary appropriations from Government for the current year.

The key reasons for the increase to Total Comprehensive Deficit and Deficit is the restructure costs (including redundancy payouts) of $1,172,799 (2015: Nil) (see Note 1.13 to the Financial Statements), asset write-offs as a result of the move to 530 Collins Street $96,010 (2015: nil) (see Note 1.9 to the Financial Statements), surplus lease space and additional rent from having an overlap of rent between 600 Bourke Street and 530 Collins Street of $83,741 (2014: nil) (see note 7 to the Financial Statements).

The move to share premises with another government agency will result in significant savings over the lease term. Other key elements of the financial results include benefits from reduced employee remuneration due to lower employee numbers and reduced costs from closing the defined benefit fund, offset by increased expenditure on core stakeholder engagement through more education and roundtable interstate roadshows, and core international influence through international travel to permit direct representation at key decision-making forums.

The current year deficit has been funded from current and prior year appropriations available to the AASB and has been incurred to reduce the possibility of the AASB exceeding its current year appropriations in future years. The restructure will enable the AASB focus on its core standard setting activities and to be more cost effective.

Note 14 to the Financial Statements provides further details of variances from the reported budget numbers.

Australian Accounting Standards Board Annual Report 2015-16

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In addition, there has been a restatement of prior year numbers (refer to Note 1.12) as a result of the resolution of the issues identified in the prior year regarding long service leave, resulting in the reclassification of long service leave entitlements to compensation amounts payable, with the associated recognition of Fringe Benefits Tax.

ACKNOWLEDGEMENTS

I have many people to thank, including:

 all those who have provided us with invaluable comments and ideas on our proposals,

participated in roundtables or Project Advisory Panels, generously giving us their time;

 the AASB members who, in addition to Board meetings, have taken on so much work out-of-session in the current year. In particular, I would like to acknowledge the significant contribution made by Regina Fikkers (Deputy Chair);

 the AASB staff - both technical and administrative - who have enabled the AASB to make

significant progress in achieving our strategies this year. I particularly want to acknowledge the work of former staff, John Hamilton, Jacqueline McCoy, Murad Ali Syed, Ahmad Hamidi Ravari, Lisa Panetta, Jim Paul, Litsa Pillios, Joanna Spencer, Verena Steiner, Puneet Tikoo, who have all contributed to the rich heritage of the AASB;

 the New Zealand Accounting Standards Board (NZASB), and in particular its Chair,

Kimberley Crook, for assisting the AASB to maintain its position on ASAF. The KASB, for conducting research jointly with the AASB; and

 the Financial Reporting Council (FRC) and its Chair, Bill Edge, for providing strategic

oversight and support of the AASB.

I would also like to acknowledge Angus Thomson, our Research Director, who finished on 30 September 2016. His invaluable contributions over 33 years of standard setting include Australian standards on insurance and superannuation that are now being emulated internationally.

I would also like to express my sincere appreciation of the efforts of Chris Gillman, Interim National Director, Merran Kelsall, AUASB Chair, Nikole Gyles, AASB Technical Director, Kala Kandiah, AASB Assistant Director, and Scott Mischke, Treasury Employment and Remuneration Policies, who were critical to enabling the restructure of the AASB and AUASB. I am also pleased to welcome Justin Lachal as the incoming National Director of the AASB and AUASB, who will work with us to strengthen our capability and performance.

Finally, I’d like to thank those who have taken the time to contribute your thoughts, feedback and examples to the AASB over the past year - and encourage others to do the same. Your contributions enable us to influence internationally and set better domestic standards.

Kris Peach Chair and CEO 7 October 2016

Page 11

WHAT DID THE AASB DO 2015-16?

VISION

The AASB’s vision is to be a leading national standard setter and a global centre of excellence. To this end, it is taking a lead role in shaping the Australian Reporting Framework, which seeks to set out how different types of Australian entities should report.

MISSION OF THE AASB

The AASB is an Australian Government Entity under the Australian Securities and Investments Commission Act 2001 (ASIC Act). The AASB legislative requirements are set out in Appendix A.

The AASB develops issues and maintains Australian Accounting Standards for both the private and public sector.

In February 2015, the AASB Strategy 2015-2019 was issued.

The mission of the AASB is to:

(a) create principle-based external reporting standards for Australia that meet user needs; and

(b) contribute to the development of international external reporting standards.

REPORT ON PERFORMANCE PORTFOLIO OUTCOME

Outcome 1: The formulation and making of accounting standards that are used by Australian entities to prepare financial reports and enable users of these reports to make informed decisions.

The Vision, Mission, Strategic directions and KPIs are consistent with Outcome 1 above and the KPIs remain consistent with the deliverables and KPIs outlined in the Portfolio Budget Statement (PBS).

The table below outlines how the AASB has performed during the year in relation to the five strategic directions included in the AASB Strategy 2015-2019, the KPIs associated with each of those strategic directions, and the related program deliverables and KPIs outlined in the PBS.

ANNUAL PERFORMANCE STATEMENT

INTRODUCTION STATEMENT

I, Kris Peach, as the accountable authority of the Australian Accounting Standards Board, present the 2015-16 annual performance statement of the Australian Accounting Standards Board, as required under paragraph 39(1)(a) of the Public Governance Performance and Accountability Act 2013 (PGPA Act). In my opinion, this annual performance statement is based

Australian Accounting Standards Board Annual Report 2015-16

Page 12

on properly maintained records, accurately reflects the performance of the entity, and complies with subsection 39(2) of the PGPA Act Entity Purpose.

ENTITY PURPOSE

The AASB is responsible for setting accounting standards for the private and public sectors in Australia (see section 227 of the Australian Securities and Investments Commission Act 2001). The main purpose of accounting and auditing standards is to assist in maintaining confidence in the Australian economy, including its capital markets. The AASB achieves this by developing, issuing and maintaining Australian Accounting Standards and related pronouncements. Accounting standards set out how entities must report externally on key transactions and events, and on their performance and financial health, in a way that is consistent and comparable with other entities in Australia and internationally. This enables people outside the entity to make informed decisions about their dealings with that entity, such as whether to:

 invest in a listed company’s shares;

 trade with/extend credit to an entity;

 donate to a particular charity; and

 hold government accountable for use of taxpayer funds.

The transparency, comparability and accountability required by accounting standards underpin public and investor confidence in the Australian economy. They reduce information gaps and enable more efficient resource/capital allocations.

The AASB has a substantial body of standards and a Conceptual Framework that address the vast majority of accounting issues facing entities in all sectors (private, public, for-profit and not-for-profit). Entities required by the Corporations Act 2001 to lodge financial reports must have their financial reports prepared in accordance with the AASB’s accounting standards, and many other types of entities are also generally required to prepare financial reports.

Page 13

AASB’S FIVE STRATEGIES FOR ACHIEVING ITS PURPOSE

RESULTS AND ANALYSIS

This has been a year of significant change. The AASB has broadened its focus and profile by implementing key initiatives to improve our international influence and stakeholder engagement. The AASB has also refocussed its operations to better meet the needs of the Australian community.

The following key achievements assisted in maintaining investor confidence in the Australian economy for 2015-16:

 Issuing AASB 116 Leases in February 2016, within one month of the IASB issuing IFRS

16, well within our target of three months. This standard provides much needed transparency for lessee lease obligations, bringing all leases onto the balance sheet. Analysts, investors and other stakeholders routinely make adjustments for operating leases, indicating that current accounting has not fully reflected the economics of leasing transactions. Capturing more information about operating leases on the balance sheet may also lead to better decision making from management, as has occurred in other circumstances such as accounting changes relating to share based payments and defined benefit plans.

 Influencing international views through reappointment to the IASB’s premier advisory body,

the Accounting Standards Advisory Forum (ASAF), in conjunction with the New Zealand Accounting Standards Board (NZASB) for a period of three years from 1 July 2015. The AASB has also had significant influence regarding the following key topics:

 insurance - through presentation of papers at ASAF in July 2015, numerous IASB staff and AASB Insurance Project Advisory Panel member discussions, and IASB representatives (Board member Sue Lloyd and Deputy Chair Ian Mackintosh) participating in Australian roundtables. Whilst the IASB is still finalising the standard,

Strategy 1:

Standard setting

Strategy 2:

Australian

reporting

framework

Strategy 3:

International

influence

Strategy 4:

Stakeholder

engagement

Strategy 5:

External

reporting

Develop standards

based on IFRS

and the principle of

transaction-neutrality, taking

into account

cost/benefit

considerations and

user needs

Take a leadership

role in shaping the

Australian

Reporting

Framework

Build international

influence with the

IASB and IPSASB

Facilitate and

encourage active

stakeholder

participation in

developing

standards

Investigate the

potential for

standards to cover

external reporting,

beyond financial

reporting

Australian Accounting Standards Board Annual Report 2015-16

Page 14

based on decisions taken to date, only one of the ten key issues raised has not been resolved as advocated by the AASB;

 leases - through submissions. Of the four key issues identified in the AASB submission, only one has not been resolved as advocated by the AASB;

 conceptual framework - through submissions, IASB representatives (Board member Sue Lloyd and Deputy Chair Ian Mackintosh) participating in Australian roundtables, and AASB staff providing input to IASB papers. The IASB conceptual framework has not yet been finalised so it is not yet clear how many of the AASB submission issues will be addressed; and

 improving IFRS implementation - through recommendations to the IASB as a result of the AASB and Korea Accounting Standards Board (KASB) joint report on ‘terms of likelihood’, which indicated that words such as ‘likely’, ‘probable’ and ‘certain’ tend to be interpreted differently between Korea and Australia and within each jurisdiction. The IASB and other national accounting standard setters have responded positively to the recommendations and presentations made by the AASB and KASB at ASAF and the International Forum of Standard Setters (IFASS). The final report was released in July 2016.

 Commencing a review of the implementation of IFRS in Australia. This will focus on two

key issues: considering how transaction neutrality has been applied across the three sectors (for profit, not-for-profit private and not-for-profit public sectors) and whether a third tier of general purpose financial reporting might be required. Extensive stakeholder outreach across all sectors has been and is continuing to be performed, including identifying relevant academic research on the impact of adopting IFRS. The final report on the findings was scheduled for June 2016, however is now expected in September 2016. This will inform the AASB’s future directions.

 Progressing the key domestic project of conducting research on the Australian Financial

Reporting Framework to inform policy makers of cost beneficial reforms, including reviewing criteria and thresholds for preparing and lodging financial reports. A Treasury briefing paper on corporate reporting issues had been anticipated prior to June 2016 however has been deferred as a result of restructuring activities discussed below.

 Progressing key domestic projects on Income of Not-for-profit Entities, Service Concession

Arrangements - Grantor. Scheduled completion is December 2016. Redeliberations on Service Performance Reporting have been deferred pending further Australian feedback and the results of the NZASB consultation on an exposure draft similar to ED 270 Reporting Service Performance.

 Increasing engagement with stakeholders to improve the amount and quality of feedback

provided to the AASB. Such feedback assists the AASB to maintain and improve its ability to influence the IASB and other key international standard setting bodies. New and / or extended initiatives established this year that have had positive feedback from stakeholders including:

 encouraging feedback through emails, phone conversations, LinkedIn discussion groups and Twitter, not just formal written submissions;

What did the AASB do 2015-16?

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 Project Advisory Panels comprising recognised technical experts with one or more assigned AASB members to provide practical and technical input to the AASB on key issues;

 webinars and nation-wide education roadshows on key domestic projects;

 new forums such as the Directors’ Forums and Accounting Firms Forums;

 increasing targeted outreach with key stakeholders to 602 (2015: 436) engagements, including cobranding sessions with the AICD, CA ANZ and CPA Australia; and

 issuing the AASB’s first domestic agenda invitation to comment to obtain specific advice on the work plan for the next three years.

RESTRUCTURING ACTIVITIES

Whilst the AASB has made good progress on a number of key initiatives, some key projects have not met their timetables. In order to focus more effectively and efficiently on their core standard setting activities the AASB and AUASB have implemented a major restructure. The Boards have moved to a shared support model where both Boards are supported by a single National Director and combined administrative staff. The Boards are also adopting a more flexible, ‘program management’ approach to standard setting, focusing efforts on turning around critical projects and bringing in critical resources on a project basis as needed.

As a result of this change, ten roles in the administrative and technical teams (AASB: 8, AUASB: 2) have been made redundant and six new roles created.

The restructure is part of a broader strategy to ensure that Australia remains at the forefront of international accounting and auditing practice and that standards are ‘fit for purpose’ in the Australian environment. Technological advances, the rise in importance of non-financial reporting, stakeholder demands for clearer and more frequent information, and the need for international alliances with other standard-setters and better empirical evidence to effectively influence international developments, all pose potentially significant challenges. The Boards recognise that they will need to be more agile and responsive to meet these challenges.

The changes to the Boards’ operating model are being supported by changes in systems and processes, particularly those regarding accountability, training and employee development. Taken together, these changes will enable the Boards to collaborate and influence more effectively, and more cost-effectively set standards. Further information is set out in Note 1.14 to the Financial Statements.

Australian Accounting Standards Board Annual Report 2015

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Page

16

2015-16 AASB ACTIVITIES AND RELATED KEY PERFORMANCE INDICATORS

The table below identifies the activities the AASB identified in its Corporate Plan and Parliamentary Budget Statement (PBS) as contributing to the five strategies above, for the 2015-16 reporting period. This table also indicates whether or not the activities were achieved and, if not, why not.

Activities Strategy No. KPI Achieved/Not Achieved Explanation

Headline KPIs

1. IASB equivalent Standards issued concurrently with the release of the IFRS.

Strategy 1

PBS Outcome 1, Program 1.1 Deliverables 1,3, KPI 1

All IFRS equivalent standards to be issued within 3 months of issue by the IASB.

Achieved. The Output Structure on

page 22 identifies the standards issued for the 2015-16 reporting period.

2. Results of Post-Implementation Reviews (PIR) support issuance of Standards (and amendments thereto) based on assessing benefits and costs.

Strategy 1 1. Conduct PIR for suite of IFRS

equivalent standards through targeted outreach, and literature review of IFRS adoption impacts to determine stakeholder views on:

 transaction neutrality;

 use of the Process for Modifying IFRSs FOR NFP guidelines; and

 tiers of general purpose financial statements.

In Progress, report not achieved by due date.

Scheduled for completion by June 2016. However, now scheduled for completion by September 2016, due to additional not-for-profit feedback being sought.

What did the AASB do 2015

-16?

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17

Activities Strategy No. KPI Achieved/Not Achieved Explanation

3. Standards for not-for-profit (NFP) entities in the private and public sectors are consistent with IFRS to the extent feasible, based on assessing benefits and costs in each case.

Strategy 1

PBS Outcome 1, Program 1.1 Deliverable 2

1. Modify IFRS using Process for Modifying IFRSs FOR NFP policy in all instances.

2. Obtain stakeholder feedback on suitability of modifications for NFP use (see KPI 2.1).

3. Benchmark NFP amendments to International Public Sector Standards Board (IPSASB) amendments to IFRS, NZASB and United Kingdom public sector standards.

1. Achieved.

2. In progress, report not achieved by due date.

3. In progress, report not achieved by due date.

1. The AASB has applied the Process for Modifying IFRSs for NFP policy for all issued documents.

2. See KPI 2.1 comments.

3. Benchmarking scheduled for completion by June 2016. However, now scheduled for completion by September 2016. Restructuring activities impacted delivery of project.

4. Financial reporting reforms recommended to policymakers. Includes working with Treasury on reforms for corporate General Purpose Financial Statements (GPFS). Subsequent work will involve policymakers responsible for non-corporate entities.

Strategy 5 Briefing paper to Treasury on corporate

issues by March 2016.

In progress - Not achieved.

Benchmarking on international for profit corporate reporting requirements completed. Information gathering sessions with public sector and not for profit sector held. Benchmarking on not-for-profit sector in progress. Restructuring activities impacted delivery of project.

5. Changes to IASB proposals achieved on issues of key significance to Australian stakeholders and as identified by the AASB.

Strategies 1 & 2 Resolution by IASB of key issues in AASB submissions considered appropriate for more than 50% of the time.

Achieved. Key issues resolved as

advocated by AASB:

- Insurance 9 of

10 (90%).

- Leases 3 of 4

(75%).

Australian Accounting Standards Board Annual Report 2015

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18

Activities Strategy No. KPI Achieved/Not Achieved Explanation

6. High level of stakeholder satisfaction achieved (per survey) such that the AASB has a thorough awareness of ideas and concerns of Australian stakeholders.

Strategies 2, 4 & 5

PBS Outcome 1, Program 1.1 KPI 2

Conduct a stakeholder satisfaction survey to obtain a starting point in which to benchmark for performance improvement.

n/a - For 2015-16 assessed as part of Headline KPI 2.1 PIR of IFRS.

n/a

7. Identify and evaluate other non-accounting standard setting opportunities, such as remuneration reporting.

Strategy 4 For 2015-16 assessed as part of

Supporting KPI 7 agenda consultation. n/a n/a

What did the AASB do 2015

-16?

Page

19

Activities Strategy No. KPI Achieved/Not Achieved Explanation

Supporting KPIs

1. Maintain membership of the Accounting Standards Advisory Forum (ASAF).

Strategy 3 To be reappointed to the IASB’s ASAF. Achieved. The AASB in conjunction

with the New Zealand Accounting Standards Board reappointed until July 2018.

2. Maintain leadership of Asian-Oceanian Standard- setters Group (AOSSG) Working Groups.

Strategy 3 Lead two working groups for the

AOSSG.

Achieved. The AASB leads three

AOSSG working groups:

 Financial

Instruments;

 AOSSG Website; and

 Centres of

Excellence in Developing Countries.

3. Present papers to ASAF, IFASS and/or AOSSG. Strategies 1 & 3 PBS Outcome 1,

Program 1.1 KPI 4

Present at least 2 papers. Achieved.  Insurance Papers

presented at July 2015 ASAF meeting.

 Joint AASB/KASB1 paper on ‘IFRS Terms of Likelihood’ presented to December 2015 ASAF, and April 2016 IFASS meetings.

4. Meet with policymakers/ regulators (incl. state treasuries) to help ensure they understand relevance and appropriateness of GPFS for entities they regulate.

Strategy 5 4 meetings held with

policymakers/regulators.

Achieved. Presentations/ meetings

with Treasury, Fair Work Commission, Australian Charities and Not-for-Profit Commission (ACNC), Australian Taxation Office (ATO).

1 Korea Accounting Standards Board

Australian Accounting Standards Board Annual Report 2015

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20

Activities Strategy No. KPI Achieved/Not Achieved Explanation

5. Publish AASB research (Research Reports, Occasional Papers, Essays and staff papers) relevant to the international community to lead debate on key issues.

Strategies 2, 3, 4 & 5

PBS Outcome 1, Program 1.1 KPI 5

Publish 2 research papers. Not achieved. AASB Research Report

No 2 Accounting Judgements on Terms of Likelihood in IFRS: Korea and Australia published July 2016.

Academic Research Forum scheduled for November 2016 will provide additional sponsored AASB papers.

Additional paper not achieved due to restructuring activities and focus on domestic standard setting program.

6. Engage in staff exchanges/collaborations with peer national standard setters.

Strategy 3

PBS Outcome 1, Program 1.1 Deliverables 4, 5, 6

1 staff exchange. Achieved. KASB staff worked at the

AASB in August 2015.

7. Conduct an agenda consultation - although ongoing, the AASB periodically seeks formal input, usually in connection with IASB agenda consultation.

Strategies 2, 3 & 5 Formal domestic agenda consultation conducted every 3 years. Achieved. ITC 34 AASB Agenda

Consultation 2017-2019 issued for comment November 2015. Feedback presented at August 2016 meeting.

8. Extend database of lodged financial statements for research purposes.

Strategies 2 & 5 Database established by June 2016. In progress, Not achieved. Difficulties in contract negotiations between the

other parties involved in the project have not yet been resolved.

What did the AASB do 2015

-16?

Page

21

Activities Strategy No. KPI Achieved/Not Achieved Explanation

9. Revise the AASB’s Reduced Disclosure Requirements (Tier 2 RDR) principles.

Strategy 2 PIR of RDR by June 2016

Joint project with NZASB to issue ED on RDR by June 2016.

In progress, Not achieved.

Joint project commenced with NZASB. Additional time taken due to different views of AASB and NZASB and impact of AASB restructuring. ED expected by December 2016 and will include PIR of existing RDR.

10. Revise the AASB’s Transaction Neutrality policy [Process or Modifying IFRS for Not-for-profit Entities].

Strategies 1 & 2 For 2015-16 assessed as part of Headline KPI 2 PIR of IFRS. n/a n/a

11. Benchmark AASB transaction neutrality policy outcomes with New Zealand approach for adopting IFRS/IPSASs, benchmark to IPSASs, and report findings.

Strategy 2 For 2015-16 assessed as part of

Headline KPI 3.

n/a n/a

12. Determine the need for a third tier of general purpose financial reporting.

Strategy 2 For 2015-16 assessed as part of

Headline KPI 2 PIR of IFRS.

n/a n/a

13. Maintain Australia/New Zealand convergence in accordance with Trans-Tasman requirements for for-profit entities.

Strategies 1 & 2 For profit entities financial reports issued in Australia able to be lodged with NZ regulators with no changes.

Achieved

Australian Accounting Standards Board Annual Report 2015

-16

Page

22

Activities Strategy No. KPI Achieved/Not Achieved Explanation

14. Maintain close relationships with IPSASB and assist in IPSASB projects.

Strategy 3

Outcome 1, Program 1.1, Deliverables 4,5

1. Involvement in at least 1 IPSASB project.

2. IASB board member on IPSASB.

3. AASB provides technical adviser to IPSASB member.

4. Australian member on IPSASB Consultative Advisory Group.

Achieved. 1. AASB member of

IASB NFP working group and providing significant input to Revenue from Non-exchange transactions through NZASB.

2. AASB board member Mike Blake appointed to IPSASB 1/1/16.

3. Technical adviser provided.

4. Karen Sanderson appointed to IPSASB CAG July 2016.

Range of events conducted in February 2016 with the IPSASB Chair (and immediate Past Chair), including Australian academics forum to encourage public sector research collaboration.

What did the AASB do 2015

-16?

Page

23

Activities Strategy No. KPI Achieved/Not Achieved Explanation

15. Respond to all significant IASB and IPSASB consultation documents.

Strategy 3

Outcome 1, Program 1.1, KPI 3

Submission lodged for all significant IASB and IPSASB consultation documents.

IASB Achieved

IPSASB Not achieved.

Key submissions to IASB lodged on Conceptual Framework, Agenda Consultation, Applying AASB 9 Financial Instruments with AASB 4 Insurance Contracts, Application of Materiality.

Key submission to IPSASB made on Public Sector Combinations. However, submission on Consultation Paper on Social Benefits not made due to insufficient staff resources as focus on progressing Australian domestic standard setting priorities and restructuring activities.

Australian Accounting Standards Board Annual Report 2015

-16

Page

24

Activities Strategy No. KPI Achieved/Not Achieved Explanation

16. High-level stakeholder engagement, measured based on participation at roundtables, formal/informal submissions, targeted meetings, numbers of LinkedIn, Twitter and Facebook followers, year-on-year.

Strategy 4

Outcome 1, Program 1.1, KPI 2

Increase in:

- number of engagements;

- LinkedIn followers;

- Twitter followers;

- formal/informal submissions received;

- roundtables;

- education sessions; and

- webinars.

Achieved Engagements: 602 (2015:

436).

Linked in followers: 3,549 (2015: 2,053)

Twitter followers: 595 (2015: 226)

Formal submissions received: 153 (2015: 92)

Roundtables: 9 (2015:6) Conceptual framework (1), Service Performance Reporting (6), Financial Reporting Framework NFPs (2)

Education sessions: 9 (2015: 4) Service Performance Reporting (6), Disclosure Initiative (2), Various (1)

Webinars: 2 (2015: 0) Not-for-profit income, service performance reporting

17. Conduct stakeholder satisfaction survey, use initial year results to obtain benchmark for performance improvement including of Board and staff.

Strategy 4 For 2015-16assessed as part of

Headline KPI 2 - PIR of IFRS. n/a n/a

18. Create and maintain a database for stakeholder management with a comprehensive database of contacts and related information.

Strategy 4 Database created by June 2016. In progress, Not

achieved by June 2016. Completed August 2016. Delayed by illness of developer and restructuring activities.

What did the AASB do 2015-16?

Page 25

Output Structure

The AASB's key outputs, listed in the tables below are:

 standards and exposure drafts; and  submissions to international bodies.

Standards

AASB 1053 Application of Tiers of Australian Accounting Standards (August 2015)

AASB 16 Leases (February 2016)

AASB 2015-7 Amendments to Australian Accounting Standards - Fair Value Disclosures of Not-for-Profit Public Sector Entities (July 2015)

AASB 2015-8 Amendments to Australian Accounting Standards - Effective Date of AASB 15 (August 2015)

AASB 2015-9 Amendments to Australian Accounting Standards - Scope and Application Paragraphs (November 2015)

AASB 2015-10 Amendments to Australian Accounting Standards Effective date of Amendments to AASB 10 and AASB 128 (December 2015)

AASB 2016-1 Amendments to Australian Accounting Standards - Recognition of Deferred Tax Assets for Unrealised Losses (February 2016)

AASB 2016-2 Amendments to Australian Accounting Standards - Disclosure Initiative: Amendments to AASB 107 (March 2016)

AASB 2016-3 Amendments to Australian Accounting Standards - Clarifications to AASB 15 (May 2016)

AASB 2016-4 Amendments to Australian Accounting Standards - Recoverable Amount of Non-Cash-Generating Specialised Assets of Not-for-Profit Entities (June 2016)

Exposure drafts

ED 267 Clarification of AASB 15 (August 2015)

ED 268 Effective Date of Amendments to AASB 10 and AASB 128 (August 2015)

ED 269 Recoverable Amount of Non-cash-generating Specialised Assets of Not-for-Profit Entities (August 2015)

ED 270 Reporting Service Performance Information (August 2015)

ED 271 IFRS Practice Statement: Application of Materiality to Financial Statements (October 2015)

ED 272 Transfers of Investment Property (proposed amendments to AASB 140) (November 2015)

ED 273 Annual Improvements to IFRSs 2014-16 Cycle (November 2015)

ED 274 AASB 9 Financial Instruments with AASB 4 Insurance Contracts (November 2015)

ED 275 Definition of a Business and Accounting for Previously Held Interests (proposed amendments to AASB 3 and AASB 11) (June 2016)

Australian Accounting Standards Board Annual Report 2015-16

Page 26

Invitation to Comment

ITC 33 Request for Comment on IASB’s Request for Views on 2015 Agenda Consultation (September 2015)

ITC 34 AASB Agenda Consultation 2017-2019 (November 2015)

Submissions to International standard setters

IASB Remeasurement on a Plan Amendment, Curtailment or Settlement/Availability of a Refund from a Defined Benefit Plan (October 2015)

IASB Clarifications to IFRS 15 (October 2015)

IASB Conceptual Framework for Financial Reporting and Updating References to the Conceptual Framework (December 2015)

IASB Request for Comment on IASB’s Request for Views on 2015 Agenda Consultation (December 2015)

IASB Applying IFRS 9 Financial Instruments with AASB 4 Insurance Contracts (proposed amendments to IFRS 4) (February 2016)

IASB Annual Improvements to IFRSs 2014-2016 Cycle (February 2016)

IASB Transfers of Investment Property (March 2016)

IASB IFRS Practice Statement: Application of Materiality to Financial Statements (March 2016)

IFRIC Uncertainty over Income Tax Treatments (January 2016)

IFRIC Foreign Currency Transactions and Advance Consideration (January 2016)

IFRS Foundation Trustees

IFRS Foundation Trustees’ Review of Structure and Effectiveness (November 2015)

IPSASB The Applicability of IPSASs (November 2015)

IPSASB Amendments to IPSAS 25 Employee Benefits (April 2016)

IPSASB Public Sector Combinations (June 2016)

IVSC IVSC Review Group Report Engagement Paper (September 2015)

AASB Authoritative Pronouncements can be accessed from the AASB website at www.aasb.gov.au/Pronouncements.aspx.

The Standard Setting and Research Centre Work Programs are available from the AASB website at www.aasb.gov.au/Work-In-Progress/AASB-Work-Program.aspx.

Page 27

MANAGEMENT AND ACCOUNTABILITY

HOW THE AASB WORKS

The Chair is appointed by the Minister, while other Board members are appointed by the Financial Reporting Council (FRC).

To be eligible for appointment as a member of the AASB, a person must have knowledge of, or experience in, business, accounting, law or government. Appointments may be made for a period of up to five years and retiring members are eligible for reappointment.

The members of the AASB during 2015-16 are listed below. The Board held 7 meetings for a total of 12 meeting days during the year. Attendance of members at these meetings is set out in Appendix B.

The Minister

The Minister appoints the Chair of the AASB. The Chair of the AASB is accountable to the Minister regarding the operations of the AASB and the Office of the AASB.

Australian Accounting Standards Board Annual Report 2015-16

Page 28

Financial Reporting Council

Responsible to the Minister, the FRC provides broad strategic direction and advice to the AASB and has oversight of the process for setting accounting standards in Australia. The FRC appoints Board members to the AASB.

AASB

The AASB is an Australian Government Entity responsible for making accounting standards under section 334 of the Corporations Act 2001. The AASB participates in, and contributes to, the development of a single set of international accounting standards for worldwide use.

Office of the AASB

The Office of the AASB provides technical and administrative services, information and advice to the AASB. The Chair of the AASB is also the Chief Executive Officer of the Office of the AASB.

Membership

Kris Peach, Chair

Kris Peach was appointed, as Chair of the AASB and CEO of the Office of the AASB for a five-year term from 1 November 2014 to 31 October 2019.

The duties of the Chair and CEO of the AASB are outlined in sections 235D to 235J of the Australian Securities and Investments Commission Act 2001.

As Chair of the AASB, she is also a member of the FRC and a member of NZASB. Ms Peach is also a member of ASAF.

The members of the AASB holding office during the year ended 30 June 2016 were:

Board Member Qualification Appointment end date

Mike Blake Auditor General Tasmania December 2017

Peter Carlson KPMG December 2016

Anna Crawford Deloitte Touché Tohmatsu December 2016 (2

nd term)

Kimberley Crook Chair of the New Zealand

Accounting Standards Board Reciprocal member from 1 July 2014

Regina Fikkers PricewaterhouseCoopers December 2016

Peter Gibson Commonwealth Department of

Finance

December 2018

Andrew Kearnan Non-Executive Director December 2017

Steve Mitsas Victorian Department of

Treasury and Finance

December 2016

Carmen Ridley Australian Financial Reporting

Solutions

December 2017 (2 nd term)

Taryn Rulton Monash College December 2016

Management and accountability

Page 29

Board Member Qualification Appointment end date

Marc Smit National Australia Bank December 2016

Ann Tarca University of Western Australia December 2016

Megan Wilson Ernst & Young December 2017

Observers The following had observer status during all or part of the year:

Observer Qualification

Tim Youngberry Australian representative on the IPSASB

John O’Grady Member of the IASB IFRS Interpretations Committee

AASB’S CORPORATE GOVERNANCE

The corporate governance practices of the AASB and the Office of the AASB comply with statutory and other external requirements, and aim to achieve sound administrative and financial management practice. They are designed to ensure the efficient, effective and ethical use of resources.

As part of its ongoing focus on effective governance arrangements, the Office of the AASB periodically considers a range of issues, including:

 clear accountability mechanisms;

 its leadership, culture and communication;

 appropriate governance and committee structures;

 the effectiveness of its work with stakeholders;

 comprehensive risk management, compliance and assurance systems; and

 strategic planning, performance monitoring and evaluation.

Audit Committee

The Audit Committee’s role is to provide independent assurance and assistance to the AASB Chair on the AASB financial and performance reporting responsibilities, risk oversight and management, and system of internal control. The Committee is not responsible for the executive management of these functions. The Committee engages with management in discharging its advisory responsibilities and formulating its advice to the Chair.

The AASB’s Audit Committee follows the recommended best practice guidelines issued by the Australian National Audit Office (ANAO). The Audit Committee comprises an independent external Chair, an external member and the Chairman of the Auditing and Assurance Standards Board (AUASB) . The ANAO also attends Audit Committee meetings as an observer, as do other AASB management representatives.

Australian Accounting Standards Board Annual Report 2015-16

Page 30

Fraud

Fraud control is regarded by the AASB as a continuous process, and AASB officers and staff maintain an awareness of fraud risk generally, and their responsibility to take any reasonable action to reduce the possibility and impact of losses through fraud.

The AASB has in place a fraud risk assessment and fraud control plan. It has adequate fraud prevention, detection, investigation and reporting mechanisms that meet its specific needs.

I, Kris Peach, as the accountable authority, certify that the AASB meets the obligations arising from section 10 of the Public Governance, Performance and Accountability Rule 2014. This legislation requires appropriate fraud risk, fraud assessment, fraud detection and subsequent reporting mechanisms to be in place.

Ethics

The Office of the AASB staff are required to adhere to the Australian Public Service values and code of conduct under the Public Service Act 1999.

Australian Public Service values include performing functions impartially and professionally, the highest ethical standards, open accountability, providing frank, honest, comprehensive, accurate and timely advice to government and promoting communication, consultation, cooperation and input from employees.

The requirements of the code of conduct include honesty, care and diligence, courtesy, compliance with the law, avoiding conflicts of interest and proper use of Commonwealth resources and information.

Management and accountability

Page 31

MANAGEMENT OF PERSONNEL

Table 1a: AASB Employees at 30 June 2016 F/T Equivalents

Classification Persons Ongoing Non-

ongoing

F/T P/T Female Male Total

Senior executive 5 3 2 4 1 4 1 5

Technical 11 8 3 9 3 3.8 6.8 10.6

Non-Technical 6 3 3 5 2.6 3 5.6

Total employees 22 14 8 18 4 10.4 10.8 21.2

Table 1b: AASB Employees at 30 June 2015 F/T Equivalents

Classification Persons Ongoing Non-

ongoing

F/T P/T Female Male Total

Senior executive 4 4 - 4 - 3 1 4

Technical 13 13 - 10 3 4.8 7.8 12.6

Non-Technical 6 6 - 5 1 3.4 2 5.4

Total employees 23 23 - 19 4 11.20 10.80 22.00

As at 30 June 2016 no employees identified as Indigenous.

AASB employees are located in one office in Melbourne.

Table 2: AASB Salary ranges as at 30 June 2016

Salary Bands

Senior executive

full time

Senior executive

part time

Technical & non-technical full time

Technical & non-technical part

time

$ 15,000 to $104,999 - - 7 2

$105,000 to $194,999 1 - 7 1

$195,000 to $284,999 1 1 - -

$285,000 to $374,999 1 - - -

$375,000 to $464,999 1 - - -

The Chair is employed pursuant to a contract for services with the AASB, with salary and other entitlements determined by the Commonwealth Remuneration Tribunal.

The salaries and other entitlements of the technical and non-technical employees are linked to comparable industry and market levels of remuneration.

Australian Accounting Standards Board Annual Report 2015-16

Page 32

Formal performance appraisal meetings are held annually and regular informal feedback is encouraged to facilitate productive staff management.

Employees attend seminars, conferences and training programs as required on topics related to the technical, policy or administrative work of the AASB.

The AASB has the capacity to employ staff under the ASIC Act, as well as the Public Service Act 1999 (PSA). As at 30 June 2016, all staff were employed under the ASIC Act.

The AASB has continued to provide various support services to the Office of the AUASB.

Employees of the Office of the AASB do not receive performance bonuses.

The changes to the AASB and AUASB’s operating models set out in note 1.13 to the Financial Statement, are being supported by changes in systems and processes, particularly those regarding accountability, training and employee development. The Boards are also adopting a more flexible, ‘program management’ approach to standard setting, focusing efforts on turning around critical projects and bringing in critical resources on a project basis as needed.

As a result the AASB is confident that it has the appropriate employees and is developing appropriate policies and procedures to enable them to achieve the AASB’s strategies.

Page 33

FINANCIAL REPORT

Independent Auditor’s Report ....................................................................................... 34

Statement of Comprehensive Income ........................................................................... 37

Statement of Financial Position ..................................................................................... 38

Statement of Changes in Equity .................................................................................... 39

Cash Flow Statement .................................................................................................... 40

Schedule of Commitments ............................................................................................ 41

Schedule of Contingencies ........................................................................................... 42

Summary of Significant Accounting Policies ............................................ 42 Note 1: Events After the Statement of Financial Position Date ............................. 47 Note 2: Expenses .................................................................................................. 48 Note 3: Sale of goods and rendering of services .................................................. 48 Note 4:

Financial Assets ........................................................................................ 48 Note 5: Payables ................................................................................................... 49 Note 6: Employee Provisions ................................................................................ 50 Note 7: Note 8: Cash Flow Reconciliation ......................................................................... 51

Note 9: Senior Management Personnel Remuneration ........................................ 52

Note 10: Remuneration of Auditors ......................................................................... 52

Note 11: Financial Instruments ................................................................................ 53

Note 12: Appropriations ........................................................................................... 54

Note 13: Compliance with Statutory Conditions for payments from the Consolidated Revenue Fund .................................................................... 55

Note 14: Budgetary Reports and Explanations of Major Variances ........................ 56 Note 14A: Major Budget Variances for 2016 ............................................................. 56

Statement of Comprehensive Income ........................................................................... 57

Statement of Financial Position ..................................................................................... 58

Statement of Changes in Equity .................................................................................... 59

Cash Flow Statement .................................................................................................... 60

Australian Accounting Standards Board Annual Report 2015-16

Page 34

Independent Auditor’s Report

Financial report

Page 35

Australian Accounting Standards Board Annual Report 2015-16

Page 36

STATEMENT BY THE CHAIR AND FINANCE MANAGER

In our opinion, the attached Financial Statements for the year ended 30 June 2016 comply with subsection 42(2) of the Public Governance, Performance and Accountability Act 2013 (PGPA Act), and are based on properly maintained financial records as per subsection 41(2) of the PGPA Act.

In our opinion, at the date of this statement, there are reasonable grounds to believe that the Office of the Australian Accounting Standards Board will be able to pay its debts as and when they fall due.

Kris Peach Chair and CEO

Paul Casey Finance Manager

7 October 2016 7 October 2016

Financial report

Page 37

Statement of Comprehensive Income for the period ended 30 June 2016 Notes 2016 2015

$ $

EXPENSES

Employee benefits 3A 4,324,883 3,727,451

Supplier expenses 3B 884,489 575,689

Operating lease rentals-minimum lease payments (refer Note 3 Schedule of Commitments) 489,653 376,838

Depreciation 69,267 132,382

Amortisation 11,005 21,217

Finance costs 2,601 18,832

Write-down and impairment of assets

1.9/ 1.10 33,762 -

Total expenses 5,815,660 4,852,409

LESS:

OWN-SOURCE INCOME

Own-source revenue

Sale of goods and rendering of services 4 213,634 260,991

Rental income 59,144 56,933

Audit Services received free of charge 34,000 38,000

Board Members Services received free of charge 68,865 -

Contributions from state and territories 500,000 500,000

Total own-source revenue 875,643 855,924

GAINS

Sale of Assets 1,490 -

Total gains 1,490 -

Total own-source income 877,133 855,924

Net cost of services and cost of outcome delivery 4,938,527 3,996,485

Revenue from Government 3,651,000 3,701,000

Deficit attributable to the Australian Government (1,287,527) (295,485)

OTHER COMPREHENSIVE DEFICIT

Revaluation of infrastructure, plant and equipment 1.9 (62,247) -

Remeasurement of net defined benefit plan - (222,000)

Total other comprehensive deficit (62,247) (222,000)

Total comprehensive deficit attributable to the Australian Government (1,349,774) (517,485)

The above statement should be read in conjunction with the accompanying notes.

Australian Accounting Standards Board Annual Report 2015-16

Page 38

Statement of Financial Position as at 30 June 2016 Notes 2016 2015 2014

Restated1 Restated1

$ $ $

ASSETS

Financial assets

Cash and cash equivalents 598,700 401,764 493,045

Trade and other receivables 5A 74,434 75,321 53,138

Appropriation receivables 5B 3,156,602 3,504,665 3,934,453

Net defined benefit plan - - 224,000

Total financial assets 3,829,736 3,981,750 4,704,636

Non-financial assets

Furniture and computers - Level 2 1.9 91,076 74,387 101,217

Leasehold improvements and make good - Level 3 1.9 -

93,490 175,325

Intangibles 1.10 - 15,191 30,203

Prepaid expenses 25,824 31,437 9,976

Inventory of publications - - 2,276

Total non-financial assets 116,900 214,505 318,997

Total assets 3,946,636 4,196,255 5,023,633

LIABILITIES

Payables

Suppliers 6A 206,579 55,356 55,300

Other payables1 6B 2,018,847 886,368 1,165,592

Total payables 2,225,426 941,723 1,220,892

Provisions

Employee provisions1 7 692,532 805,737 920,867

Lease restoration provisions - 149,341 144,935

Total provisions 692,532 955,078 1,065,802

Total liabilities 2,917,958 1,896,801 2,286,694

Net assets 1,028,678 2,299,454 2,736,939

EQUITY

Contributed equity 522,000 443,000 363,000

Asset revaluation reserve - 62,247 62,247

Retained earnings 506,678 1,794,206 2,311,692

Total equity 1,028,678 2,299,454 2,736,939

The above statement should be read in conjunction with the accompanying notes.

1. Comparative figures have been restated and some have been reclassified (refer Note 1.12)

Financial report

Page 39

.

Statement of Changes in Equity for the period ended 30 June 2016 Retained earnings Asset revaluation

reserve

Contributed equity/capital

Total equity

2016 2015 2016 2015 2016 2015 2016 2015

Opening balance as at 1 July

Balance carried forward from previous period

1,794,206 2,545,653 62,247 62,247 443,000 363,000 2,299,453 2,970,900

Adjustment for restatement (refer Note 1.12)

(233,961) (233,961)

Adjusted opening balance

1,794,206 2,311,692 62,247 62,247 443,000 363,000 2,299,43 2,736,939

Comprehensive income

Other comprehensive income

Revaluation of infrastructure, plant and equipment (ref Note 1.9)

- - (62,247) - - - (62,247) -

Re-measurement of defined benefit plan (ref Note 3A)

- (222,000) - - - - - (222,000)

Deficit for the period (1,287,527) (295,485) - - - - (1,287,527) (295,485)

Comprehensive income attributable to the Australian Government

(1,287,527) (517,485) (62,247) - - - (1,349,774) (517,485)

Transactions with owners

Departmental capital budget

- - - - 79,000 80,000 79,000 80,000

Closing balance as at 30 June

506,678 1,794,206 - 62,247 522,000 443,000 1,028,678 2,299,454

The above statement should be read in conjunction with the accompanying notes.

Australian Accounting Standards Board Annual Report 2015-16

Page 40

Cash Flow Statement for the period ended 30 June 2016 Notes 2016 2015

$ $

OPERATING ACTIVITIES

Cash received

Appropriations 3,932,940 5,006,907

Goods and services 315,943 333,531

Net GST received 148,993 141,688

States and territories contributions received 500,000 500,000

Other cash received - 38,601

Total cash received 4,897,876 6,020,727

Cash used

Employees 3,749,317 4,020,857

Suppliers 970,782 1,219,019

Net GST paid 43,165 46,092

3rd party receipts transferred to Official Public Account - 826,040

Total cash used 4,763,264 6,112,008

Net cash flows from (used by) operating activities 134,612 (91,281)

INVESTING ACTIVITIES

Cash used

Purchase of Infrastructure, plant and equipment 84,288 29,921

Cash received from the disposal of infrastructure, plant & equipment (1,490) -

Net cash flows used by investing activities 82,798 29,921

FINANCING ACTIVITIES

Cash received

Contributed equity 145,123 29,921

Net cash flows from financing activities 145,123 29,921

Net increase / (decrease) in cash held 196,937 (91,281)

Cash and cash equivalents at the beginning of the reporting period 401,764 493,045

Cash and cash equivalents at the end of the reporting period 598,700 401,764

The above statement should be read in conjunction with the accompanying notes.

Financial report

Page 41

Schedule of Commitments as at 30 June 2016 2016 2015

BY TYPE $ $

Commitments receivable

Sublease rental income1 - 71,886

GST recoverable on commitments 190,482 56,428

Total commitments receivable 190,482 128,314

Commitments payable

Operating leases2,3,4,5,6 2,095,301 620,703

GST payable on commitments - 6,535

Total commitments payable 2,095,301 627,238

Net commitments by type 2,285,783 755,553

BY MATURITY

Commitments receivable

One year or less 25,067 118,434

From one to five years 134,659 9,880

Over five years 30,757 -

Total commitments receivable 190,482 128,314

Commitments payable

One year or less 275,735 579,058

From one to five years 1,481,245 48,180

Over five years 338,322 -

Total commitments payable 2,095,301 627,238

Net commitments by maturity 1,904,819 498,924

(1) Part of the leased area is sub-let and this represents the revenue from the sub-lease.

(2) Operating leases are effectively non-cancellable and comprise a lease for office accommodation,

furniture & fittings. Lease payments are subject to an increase of 3.5% per annum.

(3) In September 2015, the AASB and AUASB entered into a shared occupancy agreement at 530

Collins Street with the Tertiary Education Quality and Standards Agency. The lease runs from the

21st September 2015 to the 22nd February 2022. There is a rent free period from 21st September

2015 to 31st July 2016. The lease cost including the rent free period incentive has been straight

lined. From 1st August 2016 rent will be payable at $15,566 per month. The lease amount includes

the lease of the premises and furniture and fittings.

(4) The AASB has assumed responsibility for the full lease of the 530 Collins Street premises. The AASB

provides office accommodation space to the AUASB. From 1st July 2016 the AASB will make a

monthly management charge to the AUASB to cover the charge for this rent (amongst other items)

but will not separately identify the lease component (i.e. an all-inclusive management charge).

(5) The lease for accommodation at 600 Bourke Street ends on 31st July 2016. Accordingly, operating

lease rental expense is higher for 2015-16 due to the overlap of premises, and the recognition of the

lease incentive on 530 Collins Street.

(6) All copier leases ended prior to 30 June 2016.

The above schedule should be read in conjunction with the accompanying notes.

Australian Accounting Standards Board Annual Report 2015-16

Page 42

Schedule of Contingencies as at 30 June 2016

A number of employees have been granted contractual commitments that, should they leave with 7-10 years of service, they will receive a compensation payment as if they were entitled to Long Service Leave under the Victorian Long Service Leave Legislation, provided a Deed of Release is given to the AASB, preventing further claims against the AASB. In addition, should payments be required, FBT will be payable (see also Note 1.12).

NOTES TO AND FORMING PART OF THE FINANCIAL REPORT

Objectives of AASB

The Office of the Australian Accounting Standards Board (Office of the AASB) is a non- corporate Australian Government Entity under the ASIC Act 2001, which provides technical and administrative support to the Australian Accounting Standards Board (AASB). The Office of the AASB is the financial entity and is governed by the Public Governance, Performance and Accountability Act 2013 (PGPA Act).

The office of the AASB is structured to meet one outcome: the formulation and making of accounting standards that are used by Australian entities to prepare financial reports and enable users of these reports to make informed decisions.

Summary of Significant Accounting Policies Note 1:

1.1 Basis of Preparation of the Financial Report

The financial report of the Office of the AASB is required by section 42 of the PGPA Act and is a general purpose financial report.

The financial report has been prepared in accordance with:

 Financial Reporting Rule (FRR) for reporting periods ending on or after 1 July 2015 and

 Australian Accounting Standards and Interpretations issued by the AASB that apply for the

reporting period.

The financial report has been prepared on an accrual basis and in accordance with the historical cost convention, except for certain assets at fair value.

The financial report is presented in Australian dollars.

1.2 Significant Accounting Judgements and Estimates

There are no accounting assumptions or estimates at reporting date that have a significant risk of causing a material adjustment to carrying amounts of assets and liabilities within the next reporting period.

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1.3 Changes in Australian Accounting Standards

(a) Adoption of New Australian Accounting Standard Requirements

New standards, amendments to standards and interpretations that are applicable to future periods have been issued by the AASB. With the exception of the two standards outlined below, it is estimated that other pronouncements, when effective, will have no material impact on future reporting periods, either because the AASB does not conduct the types of transactions addressed by the pronouncements or because the extent to which they may impact the AASB is not expected to be material.

AASB 124 Related Party Disclosures is effective for annual reporting periods beginning on or after 1 July 2016. The new standard includes changes to the definition of related party and will therefore require the AASB to reassess the details of our related parties.

AASB 116 Leases is effective for annual reporting periods beginning on or after 1 January 2019. The new standard introduces a single lessee accounting model and will require the AASB to recognise assets and liabilities in relation to its existing operating lease (refer Note 1.6). The AASB is currently assessing the impact of this standard.

1.4 Revenue

(a) Revenue From Government

Amounts appropriated for departmental output appropriations for the year (adjusted for any formal additions and reductions) are recognised as revenue when the Office of the AASB gains control of the appropriation, except for certain amounts that relate to activities that are reciprocal in nature, in which case revenue is recognised only when it has been earned.

Appropriations receivable are recognised at their nominal amounts.

(b) Resources Received Free of Charge

Resources received free of charge are recognised as own-source revenue when, and only when, a fair value can be reliably determined and the services would have been purchased if they had not been donated. Use of those resources is recognised as an expense.

1.5 Transactions with the Government as Owner

Equity Injections

Amounts appropriated which are designated as ‘equity injections’ for a year (less any formal reductions) and Departmental Capital Budgets are recognised directly in contributed equity in that year.

1.6 Leases

The Office of the AASB has no finance leases.

Operating lease payments are expensed on a straight-line basis, which is representative of the pattern of benefits derived from the leased assets, including lease incentives for rent free periods.

The Office of the AASB also has an agreement for the leasing of its’ previous premises which terminates on the 31 July 2016, which required the Office of the AASB to restore the premises to their original condition at the conclusion of the lease. The amount of $275,000 has been agreed and will be paid in July 2016 (Refer Note 6B).

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1.7 Financial Assets

The Office of the AASB’s financial assets comprises ‘receivables’.

Financial assets are recognised and derecognised upon ‘trade date’.

1.8 Financial Liabilities

The Office of the AASB’s financial liabilities comprises ‘supplier and other payables’.

Financial liabilities are recognised and derecognised upon ‘trade date’.

1.9 Plant and equipment

(a) Asset Recognition

The initial cost of an asset includes an estimate of the cost of dismantling and removing the item and restoring the site. These costs are included in the AASB’s other non-financial assets with a corresponding provision for restoration obligations recognised.

(b) Revaluations

Following initial recognition at cost, plant and equipment are carried at fair value less accumulated depreciation. The regularity of independent valuations depends upon the volatility of movements in market values for the relevant assets.

Any accumulated depreciation as at the revaluation date is restated proportionately with the change in the gross carrying amount of the asset so that the carrying amount of the asset after revaluation equals its revalued amount.

The valuation techniques used are identified in the table below.

Category Valuation technique(s) Inputs used

Plant and equipment - Furniture and Computers

2 Market Approach Adjusted market

transaction

Plant and equipment - Leasehold improvements and make good

3 Depreciated replacement

cost

Replacement Cost New (price per square metre)

There has been no change to the valuation techniques used.

The different levels of the fair value hierarchy are defined below

Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at measurement date.

Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.

Level 3: Unobservable inputs for the asset or liability.

(c) Depreciation

Depreciable plant and equipment assets are written-off to their estimated residual values over their estimated useful lives to the Office of the AASB using the straight-line method of depreciation.

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Depreciation rates applying to each class of depreciable asset are based on the following useful lives:

2016 2015

Plant and equipment - Leasehold improvements and make good Lease term — ten years Lease term — ten years

Plant and equipment - Furniture and Computers Three to ten years Three to ten years

(d) Impairment

All assets are assessed for impairment at the Statement of Financial Position date. The recoverable amount of an asset is the higher of its fair value less costs to sell and its value in use. Where the future economic benefit of an asset is not primarily dependent on the asset’s ability to generate future cash flows, and the asset would be replaced if the Office of the AASB was deprived of the asset, its value in use is taken to be its depreciated replacement cost.

During 2016, as a result of moving premises, all remaining fixtures, fittings and leasehold improvements at 600 Bourke Street were written off, totalling $71,109 (2015:Nil). Some IT equipment including desktop computers were replaced and as a consequence $20,713 (2015: Nil) was written off.

This impairment is reflected under ‘Write-down and impairment of assets’ and the ‘Revaluation of infrastructure, plant and equipment’ sections in the Statement of Comprehensive Income. The total impairment of $91,822 is recognised as a reduction in the Asset Revaluation Reserve of $62,247 relating to the fixtures and fittings, with the remaining $29,575 expensed.

1.10 Intangibles

The Office of the AASB’s intangible assets comprises purchased software and licences for internal use. These assets are carried at cost, less accumulated amortisation.

Software and licences are amortised on a straight-line basis over their anticipated useful life. The useful life of the Office of the AASB’s software and licences is one to five years (2014-15: one to five years).

A total of $4,186 (2015: Nil) was written off intangible assets (software licenses etc.) due to outsourcing all IT activities to the Productivity Commission.

1.11 Taxation

The Office of the AASB is exempt from all forms of taxation, except Fringe Benefits Tax (FBT) and the Goods and Services Tax (GST).

1.12 Restatement of prior year amounts - Fringe Benefits Tax and Long Service Leave

In the previous financial year the AASB accrued amounts in relation to employees’ long service leave relating to their time working for the Australian Accounting Research Foundation (AARF), pre 1 July 2000 as the time served was deemed continuous employment. The AASB has since obtained legal advice that payment for AARF service would exceed employee entitlements under the Long Service Leave (Commonwealth Employees) Act 1976 and it is therefore not permitted to recognise such amounts as long service leave.

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In order to avoid disputes with employees, the AASB has offered compensation in return for a Deed of Release preventing further claims against the AASB. Accordingly the Employee Provisions - Long Service Leave (refer Note 7) has been reduced and Other Payables - Compensation and related FBT expenses (note 3B) increased by $207,981 at 30 June 2014.

In addition the AASB has obtained a private ruling from the ATO confirming that FBT is payable on the compensation amounts. As these amounts relate to service prior to 1 July 2000, the retained surplus at 1 July 2000 has been decreased and Other Payables - Compensation and related FBT expenses (refer Note 3B) has been increased by $199,826.

In addition, in the 2016 financial year it was determined that two ex-employees were entitled to additional long service leave payments due to prior continuous government service that had not been initially recognised as such. As these amounts relate to service prior to 30 June 2014 the Provision for Long Service Leave at 30 June 2014 has increased and Opening retained earnings has decreased by $34,135.

Accordingly, the following adjustments have been made:

30 June 2015

Increase / (Decrease)

30 June 2015 (Restated) 30 June

2014

Increase / (Decrease)

30 June 2014 (Restated)

Statement of Financial Position (extract)

Other payables 478,561 407,807 886,368 757,785 407,807 1,165,592

Employee provisions 979,583 (173,846) 805,737 1,094,713 (173,846) 920,867

Total Liabilities 1,662,840 233,961 1,896,801 2,052,733 233,961 2,286,694

Net Assets 2,533,415 (233,961) 2,299,454 2,970,900 (233,961) 2,736,939

Retained Surplus 2,028,168 (233,961) 1,794,206 2,545,653 (233,961) 2,311,692

Total equity 2,533,415 (233,961) 2,299,454 2,970,900 (233,961) 2,736,939

1.13 Restructure

In order to focus more effectively and efficiently on its core standard setting activities the AASB has, in conjunction with the AUASB, commenced a major restructuring project. The Boards are moving to a shared support model, where both Boards will be supported by a single National Director and combined administrative staff. The AASB is also implementing a more flexible, ‘program management’ approach to standard setting, focusing efforts on turning around critical projects, and bringing in expert resources on a project basis, as needed.

As a result of this change, ten roles in the administrative and technical teams between both organisations have been made redundant and six new roles created.

The restructure is part of a broader strategy to ensure that Australia remains at the forefront of international accounting and auditing practice and that standards are ‘fit for purpose’ in the

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Australian environment. Technological advances, the rise in importance of non-financial reporting, stakeholder demands for clearer and more frequent information, and the need for international alliances with other standard setters and better empirical evidence to effectively influence international developments, all pose potentially significant challenges. The Boards recognise that they will need to be more agile and responsive to meet these challenges.

The changes to the Boards’ operating model are being supported by changes in systems and processes, particularly those regarding accountability, training and employee development. Taken together, these changes will enable the Boards to collaborate and influence more effectively.

Over the year the AASB has made, or is in the process, of making 8 employees redundant. All decisions regarding roles had been made and advised to the relevant employees prior to 30 June 2016. The total cost of the restructure is $1,172,799 which comprises Employee benefits, Separation and redundancies $1,021,501 (refer Note 3A Separation and redundancies), Employee transition advice costs $96,000 (refer Note 3A Separation and redundancies), and employee service related compensation and related FBT costs of $55,470 (refer Note 3B).

During the financial year other amounts were paid to staff that were terminated without being made redundant and are not included in these figures. These included Employee benefits, Separation and redundancies $12,381 (refer Note 3A Separation and redundancies) and Compensation and related FBT costs of $11,060 (refer Note 3B).

Events After the Statement of Financial Position Date Note 2:

There are no major events post 30 June 2016.

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Expenses Note 3:

Note 3A: Employee benefits

2016 2015

$ $

Wages and salaries 2,738,273 2,773,041

Superannuation:

Defined contribution plan 243,789 382,271

Defined benefit plan (refer Note 1 below) - 207,000

Leave and other entitlements 212,939 329,464

Separation and redundancies (refer Note 1.13) 1,129,882 35,675

Total employee benefits 4,324,883 3,727,451

1. The defined benefit plan sponsored by the Office of the AASB closed with effect from 1 May 2015 and all of the Office’s legal and constructive obligations under the plan were settled as at 30 June 2015.

2016 2015

$ $

Note 3B: Suppliers

Goods and services

Board Member Services 75,595 60,664

International Travel 161,110 93,075

Publications/Subscriptions 90,325 95,334

Administration 266,432 163,078

Consultants 139,512 119,049

Compensation and related FBT expenses (refer Note 1.13) 66,530 -

Workers compensation 6,945 10,308

Other 78,040 34,181

Total goods and services expenses 884,489 575,689

Goods and services include $142,252 of related party expenses (2015: $97,323).

Sale of goods and rendering of services Note 4:

Sale of goods and rendering of services includes $192,592 of related party income (2015: $191,771).

Financial Assets Note 5:

Note 5A: Trade and other receivables

Trade and other receivables include $72,684 of related party receivables (2015: $45,110). All trade and other

receivables are expected to be recovered in no more than 12 months and are not overdue.

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Note 5B: Appropriation receivables

2016 2015

$ $

Appropriation receivables are expected to be recovered in:

No more than 12 months 3,156,602 429,063

More than 12 months - 3,075,602

Total appropriation receivables 3,156,602 3,504,665

Appropriation receivables are aged as follows:

Not overdue 3,156,602 3,504,665

Payables Note 6:

Note 6A: Suppliers

Trade creditors and accruals include $1,061 of related party payables (2015: $963).

All trade creditors and accruals are expected to be settled within 12 months.

2016 2015

Restated1

2014

Restated1

$ $ $

Note 6B: Other payables

PAYG 66,155 72,900 83,150

Redundancy & associated FBT costs (refer Note 1.13) 1,099,501 35,675 268,517

Compensation & related FBT costs (refer Note 1.12) 461,244 407,807 ,407,807

Lease commitments 116,947 138,233 251,608

Make good provision on lease (refer Note 1.6) 275,000 - -

Long service leave payable to ex-employees - 184,786 110,950

Maternity leave payable to ex-employees - 44,408 41,001

Other costs - 2,559 2,559

Total other payables 2,018,847 886,368 1,165,592

Other payables are expected to be settled within:

No more than 12 months 2,015,787 858,971 1,024,819

More than 12 months 3,060 27,397 140,773

Total other payables 2,018,847 886,368 1,165,592

1. Comparative figures have been restated (refer Note 1.12).

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Employee Provisions Note 7:

2016 2015

Restated1

2014

Restated1

$ $ $

Leave [Note 1.12 and 7 (i)] 1 692,532 805,737 920,867

Total employee provisions 692,532 805,737 920,867

Employee provisions are expected to be settled in:

No more than 12 months 628,287 218,311 412,990

More than 12 months 64,245 587,426 507,877

Total employee provisions 692,532 805,737 920,867

1. Comparative figures have been restated (refer Note 1.12).

Note 7 (i): Leave

The liability for employee benefits includes provision for annual leave and long-service leave. No provision

has been made for sick leave as all sick leave is non-vesting and the average sick leave taken in future

years by employees of the Office of the AASB is estimated to be less than the annual entitlement for sick

leave.

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Note 8: Cash Flow Reconciliation

2016 2015

Restated1

$ $

Reconciliation of net cost of services to net cash from operating activities:

Net cost of services (4,938,527) (3,996,485)

Add revenue from Government 3,651,000 3,701,000

Adjust for proceeds of disposal of assets (1,490) -

Other movement in retained earnings - Long service leave adjustment -

(467,594)

Other movement in retained earnings - Compensation payments & associated FBT (233,961)

Other movement in retained earnings - defined benefit plan actuarial gain and losses -

(222,000)

Adjustments for non-cash items:

Depreciation / amortisation 80,272 153,599

Lease incentive - amortisation (600 Bourke St) (76,931) (71,013)

Lease - straight line over lease term (600 Bourke St) (61,301) (42,363)

Lease incentive - take up of new lease (530 Collins St) 82,301 -

Provision for required restoration of premises - 4,406

Net write down of non-financial assets 33,762 2,899

Changes in assets/liabilities:

(Increase)/decrease in net receivables 280,833 454,785

(Increase)/decrease in inventories - 2,276

(Increase)/decrease in prepayments 5,613 (21,461)

Increase/(decrease) in superannuation provision - 224,000

Increase/(decrease) in other employee provisions1 812,450 (240,220)

Increase/(decrease) in supplier payables 609,839 56

Increase/(decrease) in other payables1 (109,247) 426,834

Net cash from/(used by) operating activities 134,612 (91,281)

1. Comparative figures have been restated (refer Note 1.12).

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Note 9: Senior Management Personnel Remuneration

2016

2015

Restated3

$ $

Short-term employee benefits:

Salary1,2 1,030,416 873,490

Total short-term employee benefits

1,030,416

873,490

Post-employment benefits:

Superannuation 97,449 103,493

Total post-employment benefits 97,449 103,493

Other short term benefits:

Termination benefits - Separation and redundancies 597,939 -

Total other short term benefits 597,939 -

Other long-term benefits:

Annual leave 92,163 94,285

Long-service leave3 29,953 (97,350)

Total other long-term benefits 122,115 (3,065)

Total Senior Management Personnel Remuneration 1,847,919 973,918

1. For 2016 the increase in salary is attributable to the Chair being employed for a full year (2015 7 months)

partly off-set by the restatement of compensation (note 3) and senior management personnel leaving.

2. Some senior executives received compensation payments not considered remuneration totalling

$15,473 (2015 $127,993) (see note 1.12 and 1.13)

3. The 2015 numbers have been restated to remove the compensation payments of $127,993.

4. The total number of senior executive personnel that are included in the above table is 5 (2015: 7).

Note 10: Remuneration of Auditors

Financial statement audit services were provided free of charge to the entity.

2016 2015

$ $

The fair value of the services provided:

Remuneration to the ANAO for auditing the financial statements for the reporting period 34,000 38,000

34,000 38,000

No other services were provided by the ANAO

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Note 11: Financial Instruments

Note 11A: Fair value of financial instruments

Financial instrument assets

The net fair values of cash and cash equivalents and trade receivables approximates their carrying amounts.

Financial instrument liabilities

The net fair value of trade creditors approximates their carrying amounts.

Note 11B: Credit risk

The Office of the AASB is exposed to minimal credit risk with the maximum exposure arising from defaults of debtors. The amount is equal to the trade receivables of $23,237 (2015 $45,354).

The Office of the AASB has assessed the risk of default on payment and has not identified any impairment.

Note 11C: Liquidity risk

The exposure to liquidity risk is based on the probability that the Office of the AASB will encounter difficulty in meeting its obligations associated with financial liabilities. This is highly unlikely due to government funding and mechanisms available to the Office of the AASB and internal policies and procedures put in place to ensure there are appropriate resources to meet its financial obligations.

All financial liabilities are expected to be settled within 30 days.

Note 11D: Market risk

The Office of the AASB holds basic financial instruments that do not expose it to material market risks. The AASB is not exposed to material ‘currency risk’, ‘other price risk’ or ‘interest rate risk’.

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Note 12: Appropriations

Table A: Annual Appropriations (‘Recoverable GST exclusive’)

2016

$

2015 $

Unspent Annual Appropriations (‘Recoverable GST exclusive) - Opening balance (Table B)

Cash 401,764 493,045

Appropriation Receivables 3,504,665 3,934,453

3,906,429 4,427,498

Ordinary Annual Services

Annual Appropriation - Revenue from Government

Departmental appropriations1 3,651,000 3,701,000

Departmental capital budget2 5 79,000 80,000

3,730,000 3,781,000

PGPA Act - Section 743

Own source income - transferred to the Official Public Account -

826,040

Own source income - not transferred to the Official Public Account 808,268

-

Total Appropriation received - 2015/16 4,538,268 4,607,040

Appropriation applied (current and prior years)3

Employees 3,749,317 4,020,856

Suppliers 970,782 1,219,019

Purchase of plant and equipment5 84,288 29,921

Less net GST received (148,993) (141,688)

Total appropriation applied (current and prior years) 4,655,394 5,128,108

Appropriation allocated to:

Prior year capital 2012/135 - 13,044

Prior year capital 2013/145 65,123 16,877

Prior year capital 2014/155 80,000 -

Prior year ordinary 2012/13 - 227,927

Prior year ordinary 2013/14 - 1,028,925

Prior year ordinary 2014/15 85,004 -

Total Prior years 230,127 1,286,773

Current year 4,425,267 3,841,335

Total appropriation applied (current and prior years) 4,655,394 5,128,108

Excess of appropriations applied over received4 (117,127) (521,068)

Unspent Annual Appropriations (‘Recoverable GST exclusive) - Closing balance (Table B)

Cash 598,700 401,764

Appropriation Receivables 3,156,602 3,504,665

3,755,302 3,906,429

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1. Statement of Comprehensive Income

2. Statement of Changes in Equity

3. Cash flow statement

4. Variances:

a) 2016 - various smaller costs such as consultants contributed to a small overrun which was funded

from prior year appropriations (2014/2015)

b) The Capital budget variance is due to prior year appropriations being applied to current year’s

purchases (conference call system $43,104)

5. Departmental Capital Budgets are appropriated through Appropriation Acts (No.1, 3, 5). They form part

of ordinary annual services, and are not separately identified in the Appropriation Acts.

Table B: Unspent Annual Appropriations (‘Recoverable GST exclusive’)

Authority 2016 2015

Appropriation Act 1 2014/15 3,676,302 3,761,306

Appropriation Act 1 2013/14 - capital budget - 65,123

Appropriation Act 1 2014/15 - capital budget - 80,000

Appropriation Act 1 2015-16- capital budget 79,000 -

Total 3,755,302 3,906,429

Note 13: Compliance with Statutory Conditions for payments from the Consolidated Revenue Fund

On the basis of legal advice received during the current and prior reporting periods, the AASB identified seven payments which did not meet the statutory pre-conditions for a payment from the consolidated revenue fund as set out in section 83 of the Constitution. These breaches were the result of payments made to employees in excess of their entitlements under the Long Service Leave (Commonwealth Employees) Act 1976, due to legacy contractual arrangements. The date and associated value of the payments identified as actual breaches of section 83 of the Constitution are listed below:

• July 2015 $28,565

• September 2015 $88,639

The AASB is satisfied the above payments are not recoverable, and is taking action to limit the likelihood of breaches of a similar nature occurring in the future. The AASB will continue to monitor the risks associated with actual and potential breaches of section 83 of the Constitution in future reporting periods (see also note 1.12).

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Note 14: Budgetary Reports and Explanations of Major Variances

The following tables provide a comparison of the original budget as presented in the 2015-16 Portfolio

Budget Statements (PBS) to the 2015-16 final outcome as presented in accordance with Australian

Accounting Standards for the AASB. The Budget is not audited and where applicable, the original budget

numbers have been reclassified to align with the financial statement.

Note 14A: Major Budget Variances for 2016

Explanations of major variances Footnote reference and affected statement

Due to the office move, leasehold improvement assets were written off in September 2015 1 (SoCI and SoFP)

The depreciation rate for some Intangibles was lower than budgeted, partly due to the outsourcing of IT services to the Productivity Commission

2 (SoCI and SoFP)

Retrenchment and associated costs, partly offset by lower employee numbers resulted in higher costs 3 (SoCI, SoFP and CFS)

Due to the provision for FBT on compensation payments, staff recruitment costs and consultant costs

4 (SoCI, SoFP and CFS)

Operating Lease Rentals higher due to move to new offices in September 2015 and not finalising old lease until July 2016.

5 (SoCI, SOFP and CFS)

Board Members services received free of charge - Nil effect overall 6 (SoCI)

Increase in prepaid expenses due to prepayment of international trips taken in July and an annual fee to June 2017 for press clippings paid in June 2016

7 (SoFP)

Make Good Provision now recognised as a payable (Paid July 2016) 8 (SoFP)

GST is not budgeted for in the Cash flow Statement 9 (CFS)

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Statement of Comprehensive Income for the period ended 30 June 2016 Actual Budget estimate

Original Variance

2016 2016 2016

$ $ $

EXPENSES

Employee benefits 3,6 4,324,883 3,336,618 988,265

Supplier expenses4 884,489 726,468 158,021

Operating lease rentals - minimum lease payments5 489,653 384,046 105,607

Depreciation1 69,267 145,760 (76,493)

Amortisation2 11,005 33,261 (22,256)

Finance costs 2,601 4,406 (1,805)

Write-down and impairment of assets1 33,762 - 33,762

Total expenses 5,815,660 4,630,559 1,185,101

LESS:

OWN-SOURCE INCOME

Own-source revenue

Sale of goods and rendering of services 213,634 207,270 6,364

Rental income 59,144 59,269 (125)

Audit Services received free of charge 34,000 34,000 -

Board members services received free of charge6 68,865 - 68,865

Contributions from state and territories 500,000 500,000 -

Gain on sale of assets 1,490 - 1,490

Total own-source revenue 877,133 800,538 76,594

Net cost of services 4,938,527 3,830,021 1,108,506

Revenue from Government - departmental appropriations 3,651,000 3,651,000 -

Deficit attributable to the Australian Government (1,287,527) (179,021) (1,108,506)

OTHER COMPREHENSIVE INCOME

Revaluation of infrastructure, plant and equipment1 (62,247) - (62,247)

Total other comprehensive income (62,247) - (62,247)

Total comprehensive income attributable to the Australian Government (1,349,774) (179,021) (1,170,753)

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Statement of Financial Position as at 30 June 2016 Actual Budget estimate

Original Variance

2016 2016 2016

$ $ $

ASSETS

Financial assets

Cash and cash equivalents 598,700 401,510 197,190

Trade and other receivables 3,231,036 3,503,000 (271,966)

Total financial assets 3,829,736 3,904,510 (74,774)

Non-financial assets

Plant and equipment1 91,076 138,526 (47,450)

Intangible assets2 - 42,874 (42,874)

Prepaid expenses7 25,824 9,976 15,848

Inventory of publications - 3,276 (3,276)

Total non-financial assets 116,901 194,652 (76,751)

Total assets 3,946,636 4,099,162 (152,526)

LIABILITIES

Payables

Suppliers 206,579 83,340 123,239

Other payables3,4,5,8 2,018,847 51,797 1,967,050

Total payables 2,225,426 135,137 2,090,289

Provisions

Employee provisions3 692,532 480,625 211,907

Other provisions8 - 224,550 (224,550)

Total provisions 692,532 705,175 (12,643)

Total liabilities 2,917,958 840,311 2,077,647

Net assets 1,028,678 3,258,851 (2,230,173)

EQUITY

Contributed equity 522,000 522,000 -

Asset revaluation reserve1 - 62,247 (62,247)

Retained earnings 506,678 2,674,603 (2,167,923)

Total equity 1,028,678 3,258,851 (2,230,173)

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59

Statement of Changes in Equity for the period ended 30 June 2016 Retained earnings Asset revaluation reserve Contributed equity/capital Total equity

Actual Budget Estimate Actual Budget Estimate Actual Budget Estimate Actual Budget Estimate

Original Variance Original Variance Original Variance Original Variance

2016 2016 2016 2016 2016 2016 2016 2016 2016 2016 2016 2016

Opening balance

Balance carried forward from previous period

1,794,206 2,853,624 (1,059,418) 62,247 62,247 - 443,000 443,000 - 2,299,453 3,358,871 (1,059,418)

Comprehensive income

Other comprehensive income

Revaluation of infrastructure, plant and equipment

- - - (62,247) (62,247) (62,247) (62,247)

Deficit for the period

(1,287,527) (179,021) (1,108,506) (1,287,527) (179,021) (1,108,506)

Total comprehensive income

(1,287,527) (179,021) (1,108,506) (62,247) (62,247) (1,349,774) (179,021) (1,170,753)

of which

Attributable to the Australian Government

(1,287,527) (179,021) (1,108,506) (62,247) (62,247) (1,349,774) (179,021) (1,170,753)

Contribution by owners

Departmental capital budget

79,000 79,000 - 79,000 79,000 -

Closing balance as at 30 June

506,676 2,674,603 (2,167,927) - 62,247 (62,247) 522,000 522,000 - 1,028,678 3,258,851 (2,230,172)

Australian Accounting Standards Board Annual Report 2015-16

Page 60

Cash Flow Statement for the period ended 30 June 2016

Actual Budget estimate

Original Variance

2016 2016 2016

$ $ $

OPERATING ACTIVITIES

Cash received

Appropriations 3,932,940 3,707,000 225,940

Goods and services9 315,943 267,000 48,943

Net GST received9 148,993 - 148,993

Contributions received 500,000 500,000 -

Total cash received 4,897,876 4,474,000 423,876

Cash used

Employees3 3,749,317 3,284,000 465,317

Suppliers4,5 970,782 1,190,000 (219,218)

Net GST paid9 43,165 - 43,165

Total cash used 4,763,264 4,474,000 289,264

Net cash flows from operating activities 134,612 - 134,612

INVESTING ACTIVITIES

Cash used

Purchase of infrastructure, plant and equipment 84,288 79,000 5,288

Disposal of infrastructure, plant and equipment (1,490) - (1,490)

Total cash used 82,798 79,000 3,798

Net cash flows used by investing activities (82,798) (79,000) 3,798

FINANCING ACTIVITIES

Cash received

Contributed equity 145,123 79,000 66,123

Total cash received 145,123 79,000 66,123

Net cash flows from financing activities 145,123 79,000 66,123

Net increase in cash held 196,9367 - 196,937

Cash and cash equivalents at the beginning of the reporting period 401,764 402,000 (236)

Cash and cash equivalents at the end of the reporting period 598,700 402,000 196,700

Appendices

Page 63

APPENDIX A

AASB LEGISLATIVE REQUIREMENTS The AASB is required to advance and promote the main objects of Part 12, section 224, of the ASIC Act:

(a) to facilitate the development of accounting standards that require the provision of financial information that:

(i) allows users to make and evaluate decisions about allocating scarce resources; (ii) assists directors to discharge their obligations in relation to financial reporting; (iii) is relevant to assessing performance, financial position, financing and investment; (iv) is relevant and reliable; (v) facilitates comparability; and (vi) is readily understandable.

(b) to facilitate the Australian economy by:

(i) reducing the cost of capital; (ii) enabling Australian entities to compete effectively overseas; and (iii) having accounting standards that are clearly stated and easy to understand.

(c) to maintain investor confidence in the Australian economy (including its capital markets).

Part 12, section 227, of the ASIC Act provides, among other things, that:

(1) The functions of the AASB are:

(a) to develop a conceptual framework, not having the force of an accounting standard, for the purpose of evaluating proposed accounting standards and international standards;

(b) to make accounting standards under section 334 of the Corporations Act 2001 for the purposes of the corporations legislation (other than the excluded provisions);

(c) to formulate accounting standards for other purposes;

(d) to participate in and contribute to the development of a single set of accounting standards for world-wide use; and

(e) to advance and promote the main objects of this Part.

(2) In carrying out its functions under paragraphs (1) (a) and (d) the AASB must have regard to the interests of Australian corporations which raise or propose to raise capital in major international financial centres.

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APPENDIX B

ATTENDANCE AT AASB MEETINGS The AASB met 7 times during 2015-16 for a total of 12 meeting days. In addition to preparation for these meetings, which requires consideration of detailed technical papers, members considered and voted on accounting standards and other pronouncements out of session and also attended or made presentations at seminars and other meetings related to their role as a Board member. Consequently the time committed by members is substantially more than the meeting days attended.

Member attendance is shown in the table below:

Members

Number of days eligible to attend

Number of days attended

Apologies (days)

K Peach (Chair) 12 12 0

M Blake 12 10 2

P Carlson 12 11 1

A Crawford 12 10 2

K Crook 12 12 0

R Fikkers 12 9 3

P Gibson 12 10 2

A Kearnan 12 10 2

S Mitsas 12 9 3

C Ridley 12 12 0

T Rulton 12 11 1

M Smit 12 10 2

A Tarca 12 12 0

M Wilson 12 9 3

For details of terms of appointments, please refer to the Organisational Structure section of this Report commencing on page 27.

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APPENDIX C

OTHER INFORMATION

EXTERNAL SCRUTINY

The AASB’s accounting records are audited each year by the ANAO.

AASB annual reports are scrutinised by the Senate Economics Legislation Committee and the Parliamentary Joint Committee on Corporations and Financial Services.

PURCHASING

The AASB’s general policy is that the purchase of any major capital items follow the Commonwealth Procurement Guidelines.

Information on expenditure on contracts and consultancies is also available on the AusTender website, www.tenders.gov.au.

PROCUREMENT INITIATIVES TO SUPPORT SMALL BUSINESS

The AASB supports small business participation in the Commonwealth Government procurement market. Small and Medium Enterprises (SME) and Small Enterprise participation statistics are available on the Department of Finance’s website (www.finance.gov.au/procurement/statistics-on-commonwealth-purchasing-contracts)

Officials of the AASB apply procurement practices that do not unfairly discriminate against SMEs and provide appropriate opportunities for SMEs to compete. Officials consider the benefits of doing business with SMEs when scoping the requirements and evaluating value for money.

CONSULTANTS

During 2015-16, eight new consultancy contracts were entered into involving total actual expenditure of $153,463 inclusive of $13,951 GST. No ongoing consultancy contracts were active during the 2015-16 year, involving total actual expenditure of nil.

Consultants are only engaged where there are specific gaps in our capabilities. These include, HR, IT and Legal.

Annual reports contain information about actual expenditure on contracts for consultancies. Information on the value of contracts and consultancies is available on the AusTender website.

EXEMPT CONTRACTS

The AASB has a contract with the IFRS Foundation. The contract gives the AASB rights to IFRS copyright material.

Australian Accounting Standards Board Annual Report 2015-16

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This contract and value has been exempted by the Chair from being published in AusTender on the basis that it would disclose exempt matters under the Freedom of Information Act 1982.

ADVERTISING AND MARKET RESEARCH

The AASB does not carry out any advertising or market research.

FREEDOM OF INFORMATION

Information Publication Scheme

The AASB is subject to the Freedom of Information Act 1982 (FOI Act) and publishes information to the public as part of the Information Publications Scheme (IPS). The AASB displays on its website a plan showing information in accordance with the IPS requirement (www.aasb.gov.au/FOI.aspx).

DISABILITY REPORTING

Since 1994, Commonwealth departments and agencies have reported on their performance as policy adviser, purchaser, employer, regulator and provider under the Commonwealth Disability Strategy. In 2007-08, reporting on the employer role was transferred to the Australian Public Service Commission’s State of the Service Report and the APS Statistical Bulletin. Those reports are available at www.apsc.gov.au. From 2010-11, departments and agencies are no longer required to report on those functions.

The Commonwealth Disability Strategy has been overtaken by a new National Disability Strategy 2010-2020 which sets out a ten year national policy framework to improve the lives of people with disability, promote participation and create a more inclusive society. A high level two-yearly report will track progress against each of the six outcome areas of the Strategy and present a picture of how people with disability are faring. The first of these reports became available in 2014, and can be found at www.dss.gov.au.

OCCUPATIONAL HEALTH AND SAFETY

The AASB has less than 50 employees and is therefore not required to establish an Occupational Health and Safety Committee (OHSC) under section 34 of the Occupational Health and Safety Act 2001.

The function of the OHSC is to provide the mechanism for continuing consultation between management and staff on OHS matters. All employees, and Board members, when attending meetings, are covered under Comcare and Comcover. No accidents or dangerous occurrences, or relevant investigations, took place during the 2015-16 financial year.

Appendix C: Other information

Page 67

ECOLOGICALLY SUSTAINABLE DEVELOPMENT AND ENVIRONMENTAL PERFORMANCE REPORTING

The AASB does not have specific responsibilities in relation to the administration of environmental sustainability legislation.

The nature of the AASB’s activities limits the impact of the AASB’s operations on the environment, however, the AASB is mindful of its responsibilities to minimise negative impacts. Accordingly, the AASB has in place policies and procedures designed to minimise environmental impacts by complying with government policies relating to waste, energy and travel.

The principal environmental impact minimisation activities employed are:

 waste management, through a fully commingled and organic recycling program;

 energy efficient practises in lighting, air-conditioning and computer use; and

 limited water use.

Travel restrictions limiting meetings to only essential obligations. Teleconferencing and videoconferencing are used whenever possible.

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Appendix C: 2011

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program

APPENDIX D

AGENCY RESOURCE STATEMENT AND RESOURCES FOR OUTCOMES

The significant changes in financial results from the previous year are discussed in the Chair’s Review. Explanations of variances from the budgeted financial statements for the financial year as set out in the Portfolio Budget Statement/Portfolio Additional Estimate Statement, and their implications are set out in note 14 and 14A to the financial statements.

Agency summary resource table by outcomes Office of the AASB: Resources for outcomes 2015-16 Budget Actual expenses Variation

Outcome 1:

The formulation and making of accounting standards that are used by Australian entities to prepare financial reports and enable users of these reports to make informed decisions

Output Group 1.1:

AASB

Departmental expenses

Ordinary annual services (Appropriation Bill No. 1)

3,651,000 4,859,925 1,208,925

Revenues from independent sources (section 31) 766,539 772,778 6,239

Expenses not requiring appropriation 213,020 182,957 (30,063)

Less revenue to be carried forward - - -

Total for Outcome 1 4,630,559 5,815,660 1,185,101

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Appendix C: 2011

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APPENDIX E

LIST OF REQUIREMENTS Description Requirement Page

Letter of transmittal

A copy of the letter of transmittal signed and dated by accountable authority on the date final text approved, with statement that the report has been prepared in accordance with section 46 of the Act and any enabling legislation that specifies additional requirements in relation to the annual report

Mandatory iii

Aids to access

Table of contents Mandatory iv

Alphabetical index Mandatory 75

Glossary of abbreviations and acronyms Mandatory v

List of requirements Mandatory 69

Details of contact officer Mandatory vi

Entity’s website address Mandatory vi

Electronic address of report Mandatory vi

Review by accountable authority

A review by the accountable authority of the entity Mandatory 7

Overview of the entity

A description of the role and functions of the entity Mandatory 11

A description of the organisational structure of the entity Mandatory 27

A description of the outcomes and Programs administered by the entity Mandatory 11

A description of the purposes of the entity as included in the corporate plan Mandatory 12

Where outcome and program administered by the entity differ from any Portfolio Budget Statement, Portfolio Additional Estimates Statement or other portfolio estimates statement that was prepared for the entity for the period, including details of variation and reasons for change

If applicable, Mandatory

11

Australian Accounting Standards Board Annual Report 2015-16

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Description Requirement Page

Report on the Performance of the entity

Annual performance statements

Annual performance statement in accordance with program 39(1)(b) of the Act and section 16F of the Rule Mandatory 11

Report on Financial Performance

A discussion and analysis of the entity’s financial performance Mandatory 11

A table summarising the total resources and total payments of the entity Mandatory 68

If there may be significant changes in the financial results during or after the previous or current reporting period, information on those changes, including: the cause of any operating loss of the entity; how the entity has responded to the loss and the actions that have been taken in relation to the loss; and any matter or circumstances that it can reasonably be anticipated will have a significant impact on the entity’s future operation or financial results

If applicable, Mandatory

46

Management and Accountability

Corporate Governance

Information on compliance with section 10 (fraud systems) Mandatory 30

A certification by accountable authority that fraud risk assessments and fraud control plans have been prepared Mandatory 30

A certification by accounting authority that appropriate mechanisms for preventing, detecting incidents of, investigating or otherwise dealing with, and recording or reporting fraud that meet the specific needs of the entity are in place

Mandatory 30

A certification by accountable authority that all reasonable measures have been taken to deal appropriately with fraud relating to the entity

Mandatory 30

An outline of structures and processes in place for the entity to implement principles and objectives of corporate governance Mandatory 30

A statement of significant issues reported to Minister under paragraph 19(1)(e) of the Act that relates to non-compliance with Finance law and action taken to remedy non-compliance

If applicable, Mandatory

55

External Scrutiny

Information on the most significant developments in external scrutiny and the entity’s response to the scrutiny Mandatory 65

Appendix E: List of Requirements

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Appendix C: 2012

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Description Requirement Page

Information on judicial decisions and decisions of administrative tribunals and by the Australian Information Commissioner that may have a significant effect on the operations of the entity

If applicable, Mandatory

n/a

Information on any reports on operations of the entity by the Auditor-General, (other than report under section 43 of the Act), a Parliamentary Committee or the Commonwealth Ombudsman

If applicable, Mandatory

n/a

Information on any capability reviews on the entity that were released during the period If applicable, Mandatory

n/a

Management of Human Resources

An assessment of the entity’s effectiveness in managing and developing employees to achieve entity objectives Mandatory 31

Statistics on the entity’s APS employees on an ongoing and non- ongoing basis; including the following:

 Statistics on staffing classification level;  Statistics on full-time employees;  Statistics on part-time employees;  Statistics on gender;  Statistics on staff location;  Statistics on employees who identify as Indigenous

Mandatory 31

Information on any enterprise agreements, individual flexibility arrangements, Australian workplace agreements, common law contracts and determinations under subsection 24(1) of the Public Service Act 1999.

Mandatory 31

Information on the number of SES and non SES employees covered by agreements etc. identified in paragraph 17AG(4)(c) Mandatory 31

The salary ranges available for APS employees by classification level Mandatory 31

A description of non-salary benefits provided to employees Mandatory 32

Information on the number of employees at each classification level who received performance pay If applicable, Mandatory

n/a

Information on aggregate amounts of performance pay at each classification level If applicable, Mandatory

n/a

Information on the average amount of performance payment, and range of such payments, at each classification level If applicable, Mandatory

n/a

Information on aggregate amount of performance payments If applicable, Mandatory n/a

Australian Accounting Standards Board Annual Report 2015-16

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Description Requirement Page

Assets management

An assessment of effectiveness of assets management where asset management is a significant part of the entity’s activities If applicable, mandatory

n/a

Purchasing

An assessment of entity performance against the Commonwealth Procurement Rules Mandatory 65

Consultants

A summary statement detailing the number of new contracts engaging consultants entered into during the period; the total actual expenditure on all new consultancy contracts entered into during the period (inclusive of GST); the number of ongoing consultancy contracts that were entered into during a previous reporting period; and the total actual expenditure in the reporting year on the ongoing consultancy contracts (inclusive of GST)

Mandatory 65

A statement that “During 2015-16, [specified number] new consultancy contracts were entered into involving total actual expenditure of $[specified million]. In addition, [specified number] ongoing consultancy contracts were active during the period, involving total actual expenditure of $[specified million]”.

Mandatory 65

A summary of the policies and procedures for selecting and engaging consultants and the main categories of purposes for which consultants were selected and engaged

Mandatory 65

A statement that “Annual reports contain information about actual expenditure on contracts for consultancies. Information on the value of contracts and consultancies is available on the AusTender website”.

Mandatory 65

Australian National Audit Office Access Clauses

If an entity entered into a contract with a value of more than $100,000 (inclusive of GST) and the contract did not provide the Auditor-General with access to the contractor’s premises, the report must include the name of the contractor, purpose and value of the contract, and the reason why a clause allowing access was not included in the contract.

If applicable, Mandatory

n/a

Appendix E: List of Requirements

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Appendix C: 2012

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Description Requirement Page

Exempt contracts

If an entity entered into a contract or there is a standing offer with a value greater than $10,000 (inclusive of GST) which has been exempted from being published in AusTender because it would disclose exempt matters under the FOI Act, the annual report must include a statement that the contract or standing offer has been exempted, and the value of the contract or standing offer, to the extent that doing so does not disclose the exempt matters.

If applicable, Mandatory

65

Small business

A statement that “AASB supports small business participation in the Commonwealth Government procurement market. Small and Medium Enterprises (SME) and Small Enterprise participation statistics are available on the Department of Finance’s website”

Mandatory 65

An outline of the ways in which the procurement practices of the entity support small and medium enterprises Mandatory 65

If the entity is considered by the Department administered by the Finance Minister as material in nature - a statement that AASB recognises the importance of ensuring that small businesses are paid on time. The results of the Survey of Australian Government Payments to Small Business are available on the Treasury’s website.”

If applicable, Mandatory

n/a

Financial Statements

Inclusion of the annual financial statements in accordance with subsection 43(4) of the Act Mandatory 33

Other Mandatory Information

If the entity conducted advertising campaigns, a statement that “During 2015-16, the AASB conducted the following advertising campaigns: [name of advertising campaigns undertaken]. Further information on those advertising campaigns is available on [entity’s website] and in the reports on Australian Government advertising prepared by the Department of Finance. Those reports are available on the Department of Finance’s website.”

If applicable, Mandatory

n/a

If the entity did not conduct advertising campaigns, a statement to that effect If applicable, Mandatory

66

A statement that “Information on grants awarded to AASB during 2015-16 is available at [entity’s website] If applicable, Mandatory

n/a

Outline of mechanisms of disability reporting including reference to website for further information Mandatory 66

Australian Accounting Standards Board Annual Report 2015-16

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Description Requirement Page

Website reference to where the entity’s Information Publication Scheme statement pursuant to Part II of FOI Act can be found Mandatory 66

Correction of material errors in previous annual report If applicable, Mandatory n/a

Information required by other legislation Mandatory 65

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Appendix C: 2011

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APPENDIX F

INDEX A Appropriations, 40, 43, 54, 55, 60 Audit committee, 29 Auditing and Assurance Standards Board (AUASB), 29, 32 Australian National Audit Office (ANAO), 52 Australian Securities and Investments Commission Act 2001 (ASIC Act), 32, 63

B Balance sheet, 38 Budget, 39, 59

C Cash flow, 40, 51, 60 Chair’s review, 7 Contact details, vi

F Financial Reporting Council (FRC), 27, 28

G Governance arrangements, 29

I

Independent Auditor’s Report, 34 Information publication scheme, 66 International accounting standards (IASs), 28 International Valuation Standards Council (IVSC), 26

M Membership, 28

N New Zealand Accounting Standards Board (NZASB), 28

S Schedule of commitments, 41 Schedule of contingencies, 42 Statement of changes in Equity, 39, 59 Statement of comprehensive income, 37, 57