Home' Annual Report : Annual Report 2013 - Driving a competitive future Contents 76 | FINANCIAL REPORT
NOTES TO THE
FOR THE YEAR ENDED 31 DECEMBER 2013
1. ADOPTION OF NEW AND REVISED
CPA Australia adopts all of the new and revised Standards
and Interpretations issued by the Australian Accounting
Standards Board (AASB) that are relevant to the operations
and effective for the current annual reporting period. For
the reporting period to 31 December 2013, CPA Australia
adopted the revised AASB 119 Employee Benefits.
2. SUMMARY OF SIGNIFICANT
a) Basis of preparation
The financial report has been prepared on an accruals basis
and is based on historical costs and does not take into
account changing money values or, except where stated,
current valuations of non-current assets. Cost is based on the
fair values of the consideration given in exchange for assets.
The accounting policies have been consistently applied,
unless otherwise stated.
The report is presented in Australian Dollars and all values
are rounded to the nearest thousand dollars ($'000) unless
otherwise stated under the option available under ASIC
Class Order 98/100.
b) Statement of compliance
The financial report is a general purpose financial report
that has been prepared in accordance with the Accounting
Standards, Interpretations and other authoritative
pronouncements of the Australian Accounting Standards
Board and the Corporations Act 2001. Accounting standards
include Australian equivalents to International Financial
Reporting Standards (A-IFRS). CPA Australia is a not-for-profit
entity that complies with A-IFRS which ensures that financial
statements and notes of the Consolidated Entity comply
with International Financial Reporting Standards (IFRS).
CPA Australia is not applying paragraphs specific to
CPA Australia is limited by guarantee and domiciled
The financial statements were authorised by the Board
of Directors on 21 February 2014.
c) Basis of consolidation
The consolidated financial statements incorporate the
financial statements of the Company and entities controlled
by the Company. Control is achieved where the Company
has the power to govern the financial and operating policies
of an entity so as to obtain benefits from its activities.
All inter-group transactions, balances, income and expenses
are eliminated in full on consolidation.
d) Income tax
In assessing its income tax liability, CPA Australia applies
the principles of mutuality to its revenues and expenses.
Revenue in the form of member receipts represents
mutual income and is not subject to income tax. Expenses
associated with such mutual activities are not tax deductible
for income tax purposes. All other receipts and payments
of CPA Australia are classified for income tax purposes in
accordance with income tax legislation.
Deferred income tax is provided on all temporary differences
at the balance sheet date between the tax bases of assets
and liabilities and their carrying amounts for financial
Deferred income tax liabilities are recognised for all taxable
Deferred income tax assets are recognised for all deductible
temporary differences, carry-forward of unused tax assets
and unused tax losses, to the extent that it is probable that
taxable surplus will be available against which the deductible
temporary differences and the carry-forward of unused tax
assets and unused tax losses can be used.
The carrying amount of deferred income tax assets is
reviewed at each balance sheet date and reduced to the
extent that it is no longer probable that sufficient taxable
surplus will be available to allow all or part of the deferred
income tax asset to be utilised.
Deferred income tax assets and liabilities are measured at
the tax rates that are expected to apply to the year when
the asset is realised or the liability is settled, based on tax
rates (and tax laws) that have been enacted or substantively
enacted at the balance sheet date.
Income taxes relating to items recognised directly in equity
are recognised in equity and not in the income statement.
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