Notes to the Financial Statements for the Year Ended 31 December 2020
FINANCIAL REPORT
1 . Corporate Information
The financial statements of KU Children ’ s Services ( the Company ) for the year ended 31 December 2020 were authorised for issue in accordance with a resolution of the Directors on 31 March 2021 .
The Company is incorporated as a company limited by guarantee . The financial statements are presented in Australian dollars , which is KU Children ’ s Services ’ functional and presentation currency .
2 . Application of new and revised Australian Accounting Standards
2.1 Amendments to Accounting Standards that are mandatorily effective for the current reporting period
The Company has adopted all of the new and revised Standards and Interpretations issued by the Australian Accounting Standards Board ( AASB ) that are relevant to its operations and effective for an accounting period that begins on or after 1 January 2020 .
New and revised Standards and amendments thereof and Interpretations effective for the current year that are relevant to the Company include :
• AASB 2018-7 Amendments to Australian Accounting Standards – Definition of Material
• AASB 2019-1 Amendments to Australian Accounting Standards – References to the Conceptual Framework
• AASB 2019-5 Amendments to Australian Accounting Standards – Disclosure of the Effect of New IFRS Standards Not Yet Issued in Australia .
• AASB 2019-4 Amendments to Australian Accounting Standards – Disclosure in Special Purpose Financial Statements of Not-for-Profit Private Sector Entities on Compliance with Recognition and Measurement Requirements
In the current year , the Directors have elected to apply AASB 2020-4 Amendments to Australian Accounting Standards – COVID-19 Related Rent Concessions before its mandatory application date . AASB 2020-4 amends AASB 16 Leases and is effective for annual periods that begin on or after 1 June 2020 .
The amendments introduce a practical expedient into AASB 16 . The practical expedient permits a lessee to elect not to assess whether a COVID-19- related rent concession is a lease modification . A lessee that makes this election does account for any change in lease payments resulting from the COVID-19-related rent concession the same way it would account for the change applying AASB 16 if the change were not a lease modification .
The practical expedient applies only to rent concessions occurring as a direct consequence of COVID-19 and only if all of the following conditions are met :
• The change in lease payments results in revised consideration for the lease that is substantially the same as , or less than , the consideration for the lease immediately preceding the change
• Any reduction in lease payments affects only payments originally due on or before 30 June 2021 ( a rent concession would meet this condition if it results in reduced lease payments on or before 30 June 2021 and increased lease payments that extend beyond 30 June 2021 )
• There is no substantive change to other terms and conditions of the lease .
Impact on accounting for changes in lease payments applying the exemption The Company has applied the practical expedient retrospectively to all rent concessions that meet the conditions in AASB 16.46B , and has not restated prior period figures .
The Company has benefited from a $ 616,317 month waiver of lease payments on its leases . The waiver of lease payments has been accounted for as a negative variable lease payment in profit or loss . The Company has derecognised the part of the lease liability that has been extinguished by the forgiveness of lease payments , consistent with the requirements of paragraph 3.3.1 of AASB 9 Financial Instruments .
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