25 • when a currency is exchangeable into another currency; and • how a company estimates a spot rate when a currency lacks exchangeability. The Group has assessed that the following amendment to the standards do not have a material impact on the Group currently. It will be reconsidered in future as and when it does become applicable. AASB 7 and AASB 9 Classification and Measurement of Financial Instruments (Amendments) – Effective 1 January 2026 Under AASB 9 Financial Instruments, it was unclear whether the contractual cash flows of some financial assets with ESG-linked features represented sole payments of principal and interest (SPPI), which is a condition for measurement at amortised cost. This could have resulted in financial assets with ESG-linked features being measured at fair value through profit or loss. Although the new amendments are more permissive, they apply to all contingent features, not just ESG-linked features. While the amendments may allow certain financial assets with contingent features to meet the SPPI criterion, companies may need to perform additional work to prove this. Judgement will be required in determining whether the new test is met. The amendments introduce an additional SPPI test for financial assets with contingent features that are not related directly to a change in basic lending risks or costs – e.g. where the cash flows change depending on whether the borrower meets an ESG target specified in the loan contract. Under the amendments, certain financial assets including those with ESG-linked features could now meet the SPPI criterion, provided that their cash flows are not significantly different from an identical financial asset without such a feature. The amendments also include additional disclosures for all financial assets and financial liabilities that have certain contingent features that are: • not related directly to a change in basic lending risks or costs; and • are not measured at fair value through profit or loss. The amendments clarify the key characteristics of contractually linked instruments (CLIs) and how they differ from financial assets with nonrecourse features. The amendments also include factors that a company needs to consider when assessing the cash flows underlying a financial asset with non-recourse features (the ‘look through’ test). The amendments require additional disclosures for investments in equity instruments that are measured at fair value with gains or losses presented in other comprehensive income (FVOCI). The Group is still in the process of determining the impact of the amendment on the Group. AASB 18 Presentation and Disclosure in Financial Statements (New standard – Effective 1 January 2027 Under current Accounting Standards, companies use different formats to present their results, making it difficult for investors to compare financial performance across companies. AASB 18 promotes a more structured income statement. In particular, it introduces a newly defined ‘operating profit’ subtotal and a requirement for all income and expenses to be allocated between three new distinct categories based on a company’s main business activities. The Group is still in the process of determining the impact of the new standard on the Group. AASB 2014-10 Amendments to Australian Accounting Standards – Sale or Contribution of Assets between an Investor and its Associate or Joint Venture AASB 2015-10 Amendments to Australian Accounting Standards – Effective Date of Amendments to AASB 10 and AASB 128 AASB 2017-5 Amendments to Australian Accounting Standards – Effective Date of Amendments to AASB 10 and AASB 128 and Editorial Corrections AASB 2021-7(a-c) Amendments to Australian Accounting Standards – Effective Date of Amendments to AASB 10 and AASB 128 and Editorial Corrections Resolves the conflict regarding how much of the gain on disposal the parent can recognise when control of a subsidiary is lost in a transaction with an associate or a joint venture. The Group has assessed that the amendment to the standards does not have an impact on the Group.
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