Loan Covenant Changes Under AASB 101

---

Big changes are coming for loan classifications under AASB 101 — and they take effect for entities with a 30 June 2025 year end.

These amendments shift how loan covenants affect whether liabilities are current or non-current, and introduce new disclosure requirements.

Here’s what you need to know:

✅ If you must comply with a covenant on or before the reporting date:

Compliant? Classify as non-current.

Non-compliant? It’s current, even if the bank tests later.

✅ If compliance is after the reporting date (a “future condition”):

The classification stays non-current,

But detailed disclosures are required, including the risk of breach and potential going concern issues.

These changes go beyond classification — they affect your disclosures, risk assessment, and potentially going concern.

🧾 Make sure your 30 June 2025 financials are compliant and complete.