Business trusts to adopt new financial reporting framework from 2018

Registered business trusts will have to adopt a new financial reporting framework from 2018, the Monetary Authority of Singapore (MAS) said yesterday.

The move follows changes announced in 2014, when the Accounting Standards Council (ASC) said Singapore-incorporated companies listed on the Singapore Exchange must apply a new reporting framework for annual periods beginning on or after Jan 1, 2018.

The ASC's decision, however, did not cover financial statements of registered business trusts and authorised collective investment schemes, including real estate investment trusts, which come under the MAS' purview.

Taking into account feedback from the industry and having considered practices in comparable jurisdictions, the MAS said on Thursday that business trusts should prepare financial statements in accordance with the new framework, also from Jan 1 next year.

Business trusts listed on the Singapore Exchange include Hutchison Port Holdings Trust and Keppel Infrastructure Trust.

However, authorised collective investment schemes will not have to adopt the new framework.

Their reporting practices are consistent with those in other major fund jurisdictions such as Britain and the United States, the MAS noted.

The MAS will also amend prospectus disclosure requirements, replacing references to "FRS" - the current financial reporting standards - with the new framework, with effect from 2018.

It will provide transitional relief for historical financial statements in prospectuses lodged on or after Jan 1, 2018.

In addition to restating up to three years of historical audited financial statements fully to the new framework in the prospectus, issuers of shares, debentures and units in business trusts will also have the option of using the transitional relief provided by the MAS.

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A version of this article appeared in the print edition of The Straits Times on January 20, 2017, with the headline Business trusts to adopt new financial reporting framework from 2018. Subscribe