The Evolution of Accounting Standards in NZ: From ASRB to XRB
The Accounting Standards Review Board (ASRB) of New Zealand played a crucial role in shaping the country’s financial reporting landscape for many years. However, it’s important to note that the ASRB no longer exists in its original form, as significant changes have occurred in New Zealand’s accounting standards framework over the past decade.
In 2011, the ASRB was replaced by the External Reporting Board (XRB), which now oversees the development and issuance of accounting standards in New Zealand. The XRB is an independent Crown Entity established under the Financial Reporting Act 2013, taking on the responsibilities previously held by the ASRB.
Under the XRB’s structure, the New Zealand Accounting Standards Board (NZASB) has been delegated the authority to develop and issue New Zealand’s accounting standards. This change was part of a broader effort to modernise and align New Zealand’s financial reporting framework with international standards.
The current accounting standards framework in New Zealand is designed to cater to different types of entities:
- For-profit entities
- Public benefit entities (PBEs) in the public sector
- Public benefit entities (PBEs) in the not-for-profit sector
Each category is further divided into tiers based on factors such as size, public accountability, and governing legislation. This tiered approach ensures that reporting requirements are appropriate and proportionate for different types of organizations.
For for-profit entities, New Zealand has adopted a strategy of aligning with International Financial Reporting Standards (IFRS). The NZASB issues “New Zealand equivalents to International Financial Reporting Standards” (NZ-IFRSs), which are based on IFRS but may include some modifications to suit the New Zealand context.
It’s worth noting that while NZ-IFRSs are closely aligned with IFRS, there can be some differences. These may include changes in wording to fit the New Zealand legislative environment, additional disclosure requirements, or different effective dates.
For public benefit entities, New Zealand has developed a separate set of standards. These are based on International Public Sector Accounting Standards (IPSAS) but are tailored to meet the needs of New Zealand’s public and not-for-profit sectors.
The transition from the ASRB to the XRB and the adoption of a more comprehensive accounting standards framework has been a significant development in New Zealand’s financial reporting landscape. It has helped to enhance the credibility and comparability of financial reporting across different sectors while also aligning with international best practices.
For those seeking the most up-to-date information on accounting standards in New Zealand, the XRB’s website (www.xrb.govt.nz) is now the primary resource. It provides comprehensive information on current accounting standards, exposure drafts, and other relevant guidance for preparers and users of financial statements in New Zealand.
In conclusion, while the www.asrb.co.nz domain may no longer be active, the legacy of the Accounting Standards Review Board lives on through the work of the XRB and NZASB. These organizations continue to ensure that New Zealand’s accounting standards remain robust, relevant, and aligned with international practices, supporting high-quality financial reporting across all sectors of the economy.