The Financial Accounting Standards Board (FASB) has issued a proposed framework intended to improve its process for evaluating existing and future disclosure requirements in notes to financial statements.
The proposed framework is a result of the FASB’s efforts to improve the effectiveness of disclosures to financial statements. Specifically, the framework is designed to aid the FASB in identifying what types of information the Board should consider when deciding on required disclosures. If approved, it would become part of the FASB’s Conceptual Framework, which provides the foundation for making standard-setting decisions.
Once the Board has identified what should be broadly considered based on the framework, the FASB would:
- Identify information to be disclosed in the notes that is likely to be helpful to those making decisions about providing resources and that would be relevant to a significant number of the organizations to which it applies
- Not require disclosure regarding assumptions and expectations about uncertain future events that are not reflected in the financial statements
- Consider the costs and potential consequences of providing a disclosure in the notes
The proposed concepts statement also contains a discussion of what the FASB should consider when determining which disclosures should be required at interim periods for those companies who produce such statements.
Comments on the proposed concepts statement (titled Conceptual Framework for Financial Reporting: Chapter 8: Notes to Financial Statements
) are due by July 14, 2014.
The full text of the proposed concepts statement is available by clicking here.
Readers should not act upon information presented without individual professional consultation.
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