ASIC today released the results of its reviews of financial reports for years ended 30 June 2012 and announced its areas of focus for 31 December 2012 financial reports.
ASIC Commissioner, Mr John Price said ‘Preparers of financial reports should continue to focus on reporting performance particularly in challenging economic circumstances. Focus areas include recognition of revenue and expenses, asset values and going concern.
‘Our proactive surveillance of financial reports of listed entities and other entities with larger numbers of users will include entities with shadow banking activities such as unlisted debenture issuers. We will also review the financial reports of selected larger proprietary companies’, Mr Price said.
At 31 December 2012, directors and auditors should focus particularly on:
- revenue recognition and expense deferral policies
- asset values and the disclosure of associated assumptions
- off-balance sheet arrangements, and
- going concern assessments.
Directors and auditors should also focus on disclosures of useful and meaningful information for investors and other users. This includes the disclosure of non-IFRS financial information (i.e. financial information determined other than in accordance with the International Financial Reporting Standards (IFRS) that have been adopted in Australia) in accordance with ASIC Regulatory Guide 230 Disclosing non-IFRS financial information.
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