Australian Government
Australian Accounting Standards Board
Monday, October 26, 2026
AASB 20 Regulatory Assets and Regulatory Liabilities affects only entities subject to rate regulation under which a regulator can determine how much and when they can charge customers for goods/services supplied under a regulatory agreement. For example, the Standard could be relevant to entities in the electricity, water and gas supply industries.
AASB 20 focuses on rate regulation that entitles an entity to an amount of compensation for the goods/services supplied in a period (the ‘total allowed compensation’), which could include the recovery of infrastructure costs and performance incentives. Differences in timing arise when the compensation for the goods/services supplied in one period is reflected in the regulated rates charged in another period.
The new Standard will help users of the financial statements better understand the effect of differences in timing on an entity’s financial performance, financial position and prospects for future cash flows through the recognition of regulatory assets, liabilities, income and expenses.
AASB 20 applies to annual periods beginning on or after 1 January 2029, with earlier application permitted. It supersedes AASB 14 Regulatory Deferral Accounts.