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AASB 114 - Segment Reporting
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Summary 
Developments, Key Differences & History 
Compared to IFRS 
Interpretations 
Rejection Notices 
Questions & Answers 
Articles 
AASB website 

 
Not-for-profits under AIFRS standards 
as reported in ANT 13/2006:  
 
Q: How are “not for profits” (NFPs) affected by the new Australian equivalents to International Financial Reporting Standards (AIFRS) standards? 
 
A: Since the AASB has the power to issue sector neutral standards i.e. standards to cover reporting entities in the private and public sector, “not for profit” reporting entities are covered by and will be required to comply with the new AIFRS. An NFP is defined as “an entity whose principal objective is not the generation of profit”. 
 
As part of the convergence process the AASB has included special requirements for NFP's into the new standards where these are appropriate to allow for this sector's special needs. These are generally special paragraphs inserted with the notation “AUS” prior to the number. These standards also contain the “not for profit” definition. An example is paragraph 9.1 of AASB 102 which allows NFP's to measure inventories held for distribution at the lower of cost and current replacement cost rather than the normal “cost and net realisable value” calculation. 
 
The AASB has also exempted NFP's from two standards, AASB 114 “Segment Reporting” and AASB 120 “Government Grants”. However it has also issued AASB 1004 “Contributions” which deals with the accounting treatment for contributions received by not-for-profits. All the remaining AASB standards and their requirements apply to NFP's in the same way as for profit entities. 
 
The AASB has recently published a staff paper identifying all the NFP requirements that are contained in the standards and explaining the reasons for their existence. It also provides guidance to NFPs with “for profit” subsidiaries by comparing all the relevant different requirements which may impact their consolidation. The paper can be downloaded from the AASB website http://www.aasb.com.au. 
 
 
Application of AASB 114 
as reported in ANT43/2004:  
 
Q: How are “not for profits” (NFPs) affected by the new 2005 standards? 
 
A: Since the AASB has the power to issue sector neutral standards i.e. standards to cover reporting entities in the private and public sector, "not for profit” reporting entities are covered by and will be required to comply with the new 2005 standards. An NFP is defined as "an entity whose principal objective is not the generation of profit." 
 
As part of the convergence process the AASB has included special requirements for NFP's into the new standards where these are appropriate to allow for this sector's special needs. These are generally special paragraphs inserted with the notation "AUS" prior to the number. 
 
The AASB has also exempted NFP's from two standards, AASB 114: Segment Reporting and AASB 120: Government Grants. The Board has however reissued AASB 1004, now called “Contributions” which deals with contributions received by not-for-profits. All the remaining AASB standards and their requirements apply to NFP's in the same way as for profit entities.