The QBCC (Queensland Building and Construction Commission) has recently updated their accounting regulations for QBCC licensees when changing their maximum turnover limits.
The changes to their regulations are designed to tighten the rules around the accounting records that can be provided to the QBCC via Minimum Financial Requirements (MFR) Reports.
In short, the changes require the licensee to adopt all applicable Australian Accounting Standards when lodging the MFR Reports.
We’re here to walk you through everything you need to know about the changes, how to navigate them, and what they mean for your specific licensee category.
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The overall takeaway from the change is that Special Purpose Financial Statements (SPFS) are no longer accepted by the QBCC when lodging an MFR Report from 1 July 2022, instead requiring General Purpose Financial Statements (GPFS) to be prepared.
Fortunately, you are only required to use General Purpose Financial Reports when changing your maximum revenue limit. The different categories are listed below:
An example of this may be changing from Self Certifying Category 2 (SC2) ($800k limit) to Category 1 ($3m limit). There is no requirement at the time of this blog to use General Purpose Financial Reports when lodging your annual return to QBCC.
The QBCC defines your net tangible assets (NTA) as the total assets of your business less any intangible assets. Before looking at the formula, let’s look at a few definitions:
Allowable assets (tangible assets) are things such as real estate, cash, plant and equipment, and tools of the trade.
Disallowed assets include a wide range of things such as:
Intangible assets include things such as:
From these, your NTA is then calculated using the following formula:
NTA = [assets] – [liabilities] – [intangible assets] – [disallowed assets]
Your NTA is what the QBCC uses to determine which financial category you fall into, and in turn what your maximum allowable revenue is.
General purpose financial statements(GPFS), are financial reports that are normally only prepared by bigger businesses such as large public companies.
Your GPFS should relay information regarding your business’s financial performance and position, giving details about your company’s:
To submit a GPFS, you must submit the approved form in PDF format online to the ATO, they do not accept paper or email submissions. If you are unsure of how to submit a GPFS and the needs applicable to you, please contact us today and we can ensure that you are compliant with all the new QBCC regulations.
The next step you should take to prepare for the new changes from the QBCC is to speak to your accountant. It’s possible that if they’re not a specialist in industries impacted by this change, they may not have the experience or capability to help prepare a GPFS, in which case you should contact us today.
We understand the stringent demands placed on you by the QBCC and other industry players. Changing market conditions and cash flow management issues create challenges for industry professionals, particularly with rising costs and the limited availability of materials. We can customise a tailored package to suit your building and construction accounting needs.
At QC Accountants, we offer a full range of services relating to QBCC reporting — including preparing general purpose financial reports for licensees, preparing and lodging the MFR, and helping you ensure that you have the necessary assets for your business.
For many of the businesses we work with, having a dedicated team to assist with accounting and taxation gives them peace of mind. More importantly, it gives them the ability to make informed financial decisions that will allow them to nurture their businesses – both today and into the future.
So contact us today, and let us take care of the hard work for you.