For contractors falling under financial categories SC1, SC2, 1, 2, or 3, there are some updates you need to know about the Minimum Financial Requirements Regulation (MFR Regulation). These changes will make things easier for you when submitting financial reports to the Queensland Building and Construction Commission (QBCC).
In July 2021, the Australian Accounting Standards Board (AASB) made some changes to accounting standards that affected the MFR Regulation. These changes meant that certain for-profit entities, including contractors, couldn’t use Special Purpose Financial Statements (SPFS) anymore for reporting. Instead, they had to use General Purpose Financial Statements, which can be more complicated and costly.
This switch to General Purpose Financial Statements increased the costs for many contractors. Understandably, there were concerns from the industry about these higher expenses. In response to these concerns, the Queensland Government has revised the MFR Regulation. Now, contractors falling under the financial categories mentioned earlier have the option to use SPFS again for their reporting. This change should help reduce costs and simplify the process for these contractors.
If you’re a contractor looking to adjust your maximum revenue to fit within one of these financial categories, these new provisions could benefit you as well. These changes apply to financial information included in MFR Reports from the quarter ending December 31, 2023, onwards.
Are you a small contracting business and want to learn more? Contact our Walker Hill Accounting team today! support@walkerhill.com.au.
