IASB Publishes Discussion Paper on More Effective Financial Statement Disclosures

April 2017

The International Accounting Standards Board (IASB) on 30 March 2017 published the Discussion Paper, Disclosure Initiative—Principles of Disclosure (Discussion Paper), proposing recommendations to improve communication in financial reporting through improved disclosures. The comment deadline is 2 October 2017.

In response to stakeholder comments that disclosures can include too much non-relevant information and too little relevant information, and that some information is disclosed ineffectively, the IASB has been working on developing clearer principles governing what, how, and where information should be disclosed in the financial statements. The IASB believes that the recommendations in the Discussion Paper will help companies communicate their disclosures more effectively.

The suggestions made by the IASB in the Discussion Paper include:

  • Seven principles of effective communication, which could be included in a general disclosure standard or described in non-mandatory guidance
  • Possible approaches to improve disclosure objectives and requirements in International Financial Reporting Standards (IFRS)
  • Principles of fair presentation and disclosure of performance measures and non-IFRS information in financial statements, to ensure that such information is not misleading.

The IASB is likely to use information from the consultation feedback to amend IFRS 1, First-time Adoption of International Financial Reporting Standards, as part of the IASB’s Disclosure Initiative.

The Discussion Paper is available on this link. 

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