Moving from SAK ETAP to SAK EP
SAK Entitas Privat took effect on 1 January 2025 and replaced SAK ETAP. The changes reach consolidated statements, deferred tax, investments, and retained earnings adjustments at the transition date.
Key points
- The transition date is the start of the earliest period presented, not the start of the first reporting year.
- Adjustments from the earlier framework go directly to retained earnings or another equity category where appropriate.
The Financial Accounting Standards Board of the Institute of Indonesia Chartered Accountants (IAI) approved SAK Entitas Privat (SAK EP) on 30 June 2021. It took effect on 1 January 2025, replacing SAK ETAP, and early application was allowed.
SAK EP draws on the 2015 version of the IFRS for SMEs, adapted to Indonesian conditions. It is used by entities without public accountability that issue general purpose financial statements for external users.
What changes
The IAI announcement lists differences from SAK ETAP including consolidated statements, business combinations and goodwill, deferred tax, other comprehensive income, more detailed rules on financial assets and liabilities, and fair value measurement for investment property and biological assets.
Chapter 9 requires a parent to prepare consolidated statements for subsidiaries it controls. Control is the basis. The exception is a subsidiary acquired with the intention of disposal within one year.
Chapter 29 requires deferred tax assets and liabilities on temporary differences, unused tax losses and unused tax credits. Amounts are not discounted, and unrecognised deferred tax assets are reassessed at each reporting date.
Chapter 14 gives three models for investments in associates: cost, equity method and fair value. IAI briefing material says SAK ETAP measured them at cost.
For financial instruments, an entity chooses an accounting policy. The choice is Chapters 11 and 12, or PSAK 55 for recognition and measurement with disclosure still following those chapters.
Transition
Chapter 35 sets the transition, which is retrospective with exceptions in paragraphs 35.9 and 35.10. If a requirement cannot be applied after every reasonable effort, it is applied prospectively.
At the transition date, the start of the earliest period presented, an entity recognises all assets and liabilities SAK EP requires and removes items it does not allow. Items are then reclassified, and all recognised assets and liabilities are measured under SAK EP.
Adjustments go directly to retained earnings, or another equity category where appropriate. For a calendar-year company first applying in 2025 with one comparative year, the calculation points to 1 January 2024 as the transition date.
The files to prepare are covered in the Indonesian article on SAK EP transition working papers.
Frequently asked questions
Can a company already using full Indonesian standards move to SAK EP?
IAI briefing material says an entity that previously reported under a framework more complex than SAK EP may not use it.
Must every requirement be applied retrospectively?
The base rule is retrospective, with exceptions in paragraphs 35.9 and 35.10. If a requirement cannot be applied after every reasonable effort, it is applied prospectively.