Audit Lowe Down – Incorrect presentation of your liabilities could significantly affect your balance sheet
Lowe Lippmann Chartered Accountants
In a previous blog, we discussed the changes to the accounting standards relating to classification of current / non-current liabilities on the balance sheet.
We have been receiving a number of questions on this topic and have provided some practical scenarios below as well as some actions for you as we approach 30 June reporting dates.
| Scenario | Current / non-current | Actions for consideration |
|---|---|---|
| Borrowing facility is expiring within 12 months of the reporting date. | Current | Obtain written evidence from the bank prior to reporting date that the facility will be extended and the appropriate terms and conditions. |
| Breach of a bank covenant reported prior to year end but no response from financial institution at reporting date. | Current | Obtain written evidence from the bank prior to reporting date that the covenant breach is either subject to a period of grace of at least 12 months from the reporting date or is subject to a waiver. |
| Breach of a bank covenant as at reporting date reported to the financial institution after year end. | Current | No action possible if breach not reported until after reporting date since not possible to obtain waiver / period of grace prior to the reporting date. |
| Likely to breach a covenant after the year end. | n/a | Not assessed as part of current / non-current presentation but disclosure of existence of covenant and likely breach is required. Communicate with financial institution as soon as possible to include likely outcome (if waiver or period of grace) in the disclosure. |
Please do not hesitate to contact your Lowe Lippmann Relationship Partner if you wish to discuss any of these matters further.
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Transfer Balance Cap indexation & Superannuation changes Following the recent release of the December 2025 quarterly CPI figures by the Australian Bureau of Statistics’, the general transfer balance cap ( TBC ) will increase from $2 million to $2.1 million from 1 July 2026. This is applicable for superannuation fund members considering starting their first retirement phase income stream in 2026–27. This could provide tax effective retirement pension and non-concessional contribution opportunities for some members. The Australian Taxation Office needs to formally confirm this increase.
Mandating cash acceptance The Government recently announced that it was delivering on its commitment "to mandate cash acceptance for essential purchases by finalising regulations that require fuel and grocery retailers to accept cash from 1 January 2026." The changes mean that, from 1 January 2026 , most food and grocery retailers must accept cash for in-person transactions of $500 or less between 7am and 9pm. Small businesses with aggregate annual turnover under $10 million are generally exempted from this mandate. However, this mandate still applies to small businesses that choose to share a trademark with a large retailer. The Government noted that, in addition to the cash mandate for fuel and groceries, consumers also already have the option to pay their bills, including utilities, phone bills and council rates, in cash at their local Australia Post outlet through Post Billpay. The Government will review this mandate after three years, to ensure it is functioning as intended. We prepared a Special Topic article within our Practice Update - December 2025, if you want to read more on this topic – click here .
Preparing your business for Payday Super changes starting 1 July 2026 From 1 July 2026, employers will have to pay their employees’ compulsory Superannuation Guarantee ( SG ) contributions at the same time as they pay their salary and wages (ie. ordinary time earnings, OTE ). This is a change in the frequency of the payment rather than its calculation. With less than six months remaining, we believe it is very important to start preparing your business for these changes. We will outline some actionable steps that can be taken now to help manage the process to be compliant with the new changes leading up to 1 July 2026. These changes will apply to all Employers, whether they have pay cycles weekly, fortnightly, monthly or irregularly. SG contributions must generally arrive in an employee’s chosen super fund within 7 business days of each payday . Please note that in November 2025 we released a Tax Alert after the payday super rules received Royal Assent and became law summarising the changes employers need to be aware of - to read click here .
