The draft statement PUB00396 explains:
- when a person qualifies as a cash basis person and can account for income and expenditure on a cash basis instead of an accrual basis, and
- the adjustment that must be made when a person ceases to qualify as a cash basis person.
Practical examples are also included to illustrate the difficult concepts and calculations, particularly deferral threshold and cash basis adjustment.
In CA ANZ view, the statement should help readers understand the concept of "cash basis person", the effect of being a cash basis person and the adjustment required if a person ceases to be a cash basis person or conversely if a person qualifies as a cash basis person.
CA ANZ supports the statement, that should help readers understand the concept of “cash basis person”.