Notes - Overview
Wreck Bay Aboriginal Community Council
ABN: 62 564 797 956
Notes to and forming part of the financial statements
for the period ended 30 June 2020
The Basis of Preparation
The financial statements are general purpose financial statements and are required by subsection 42 of Public Governance, Performance and Accountability Act 2013.
The financial statements have been prepared in accordance with:
Public Governance, Performance and Accoutability (Financial Reporting) Rule 2015 (FRR); and
Australian Accounting Standards and Interpretations - Reduced Disclosure Requirements issued by the Australian
Accounting Standards Board (AASB) that apply for the reporting period.
The financial statements have been prepared on an accrual basis and in accordance with historical cost convention, except for certain assets and liabilities at fair value. Except where stated, no allowance is made for the effect of changing prices on the results or the financial position. The financial statements are presented in Australian dollars.
New Accounting Standards
All new/revised/amending standards and/or interpretations that were issued prior to the sign-off date and are applicable to the
current reporting period did not have a material effect, and are not expected to have a future material effect, on the Council's
Nature of change in accounting policy, transitional provisions¹, and adjustment to financial statements
AASB15 Revenue from Contracts with Customers / AASB 2016-8 Amendments to Australian Accounting Standards - Australian Implementation Guidance for Not-for-Profit Entities and AASB 1058 Income for Not-For-Profit Entities
AASB 15, AASB 2016-8 and AASB 1058 became effective 1 July 2019.
AASB 15 establishes a comprehensive framework for determining whether, how much and when the revenue is recognised. It replaces existing revenue recognition guidance, including AASB 118 Revenue, AASB 111 Construction Contracts and Interpretation 13 Customer Loyalty Programmes. The core principle of AASB 15 is that an entity recognises revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.
AASB 1058 is relevant in cirumstances where AASB 15 does not apply. AASB 1058 replaces most of the not-for-profit (NFP) provisions of AASB 1004 Contributions and applies to transactions where the consideration to acquire an asset is significantly less than fair value principally to enable the entity to further its objectives, and where volunteer services are received.
The details of the changes in accounting policies, transitional provisions and adjustments are disclosed below and in the relevant notes to the financial statements.
AASB 16 Leases
AASB 16 became effective on 1 July 2019.
This new standard has replaced AASB 117 Leases, Interpretations 4 Determining whether an Arrangement contains a Lease, Interpretations 115 Operating Leases - Incentives and Interpretation 127 Evaluation the Substance of Transactions Involving the Legal Form of a Lease.
AASB 16 provides a single lessee accounting model, requiring the recognition of assets and liabilities for all leases, together with options to exclude leases where the lease term is 12 months or less, or where the underlying asset is of low value. AASB 16 substantially carries forward the lessor accounting in AASB 117, with the distinction between operating leases and finance leases being retained. The details of the changes in accounting policies, transitional provisions and adjustments are disclosed below and in the relevant notes to the financial statements.
Application of AASB 15 Revenue from Contracts with Customers / AASB 1058 Income for Not-For-Profit Entities
The Council adopted AASB 15 and AASB 1058 using the modified retrospective approach, under which the cumulative effect of the initial application is recognised in retained earnings at 1 July 2019. Accordingly, the comparative information presented for 2019 is not restated, that is, it is presented as previously reported under the various applicable AASB's and related interpretations.
Under the new income recognition model the Council shall first determine whether an enforceable agreement exists and whether the promises to transfer goods or services to the customers are 'sufficiently specific'. If an enforceable agreement exists and the promises are 'sufficiently specific' (to a transaction or part of a transaction), the Council applies the general AASB 15 principles to determine the appropriate revenue recognition. If these criteria are not met the Council shall consider whether AASB 1058 applies.
AASB 15 and AASB 1058 did not have any impact on the Council on transition.
AASB 16 did not have any impact on the Council on transition.
The Council is exempt from all forms of taxation except for Fringe Benefits Tax (FBT) and the Goods and Services Tax (GST).
Events after the Reporting Period
The Covid-19 pandemic of 2020 is still ongoing as at 30 June 2020 and it is expected that it continue for some time. Effects
experienced by the Council due to the pandemic include reduced camping fee income and daycare income reduced on expectation.
The pandemic will continue to impact the Councils camping fee income and daycare revenue, however it is difficult to estimate the
total future impact due to the uncertainty of when the Covid-19 restricitons will be fully lifted.