New Zealand International Financial Reporting Standards 2007-2014

NZ IFRS and New Zealand GAAP

NZ GAAP was established by the approval of financial reporting standards and authoritative guidance by the former New Zealand Accounting Standards Review Board (ASRB), an independent Crown entity (now the External Reporting Board (XRB)).

Before the adoption of IFRS, the previous standards were sector-neutral in that they applied equally to entities in all sectors. The ASRB decided that with adoption of IFRS there should continue to be one set of standards for application by all entities. However, IFRS are developed for application by profit-oriented entities and, therefore, in order for IFRS also to be applied by public benefit entities it is necessary in the case of some of the IFRSs to modify or introduce additional requirements on measurement and recognition applicable to public benefit entities.

A description of the process to convert the previous NZ GAAP to NZ IFRS is contained in an article in the New Zealand Chartered Accountants Journal.

In most cases, the intended overall effect of modifying or introducing additional requirements for public benefit entities is intended to reflect differences between the sectors, including differences in user information needs that warrant a different accounting treatment or additional guidance for public benefit entities. Occasionally, it may also be appropriate to modify an IFRS for public benefit entities and/or introduce additional requirements for other reasons.

In reaching a view on whether modifications should be made or guidance added, the ASRB was mindful of the approach adopted by the AASB and the IPSASB.

More information on the former ASRB can be found on the website of the now External Reporting Board.

Government Adoption of NZ IFRS

The Minister of Finance announced in 2003 that the Government reporting entity would adopt New Zealand equivalents to International Financial Reporting Standards (NZ IFRS) for its financial year beginning 1 July 2007.

The first publication to be published in accordance with the NZ IFRS accounting standards was the Forecast Financial Statements published on 17 May 2007 as part of Budget 2007. The Economic and Fiscal Update also included a chapter on the Impact of the Transition to NZ IFRS.

The month-end financial statements produced during 2007/08 financial year complied with NZ IFRS.

The audited Financial Statements of the Government of New Zealand for the Year Ended 30 June 2008 were the first audited statements to be prepared in compliance with NZ IFRS.

The Treasury’s Role

The Treasury was responsible for ensuring that the financial statements of the Government of New Zealand (FSGNZ) from 1 July 2007 until 30 June 2014 comply with NZ IFRS. Treasury also had a role in facilitating implementation of NZ IFRS across the public sector, although individual entities were responsible for ensuring their own NZ IFRS preparedness for reporting from 1 July 2007.

Media and Analyst Briefing on the Government's Transition to NZ IFRS

The Treasury hosted a briefing for media and analysts on 9 May 2007. The purpose of the briefing was to:

• Outline the impact of NZ IFRS on the Crown’s accounts (using preliminary results to December 2006);
• Explain changes to the format of the key financial statements, and consequential changes to fiscal indicators;
• Identify how to interpret the measurement and presentation changes when looking at forecasts;
• Provide an opportunity to address any questions and provide guidance regarding the above points.

Material from the Briefing for Download

Media and Analyst Briefing on the publication of the first audited set of NZ IFRS compliant financial statements

The Treasury hosted a “lock-up” for media and analysts on release of the Financial Statements of the Government of New Zealand for the year ended 30 June 2008 on 6 October 2008.

The purposes of this briefing included:

• Providing an opportunity to address any questions and provide guidance on the NZ FRS financial statements.
• Providing information on the additional presentation and disclosures associated with NZ IFRS

Material from the Briefing for Download

Useful Sites for NZ IFRS Implementation

• External Reporting Board (XRB) - http://xrb.govt.nz .
  • Specifically, XRB’s old accounting standards framework page has NZ IFRS information.

• International Accounting Standards Board - www.iasb.org - which includes summaries of IFRS.
• Websites of the major accounting firms contain useful summaries of IFRS, presentation and disclosure checklists and pro-forma IFRS financial statements. Although their focus is typically the international standards (i.e. without the New Zealand specific requirements), they are nevertheless useful in considering the New Zealand equivalents to these standards.

Feedback and Enquiries

We welcome any enquiries or feedback from entities relating to NZ IFRS implementation within the Government reporting entity. In the first instance please contact: