Disclosure Initiative - Principles of Disclosure
- Discussion paper consultation
- Hocine Kebli, Almudena Alcala, Ricardo Torres Ruiz-Olivares
This research project is part of the Disclosure Initiative project, which is a broad-based initiative, exploring how disclosures can be improved in the financial statements. The objective of the Principles of Disclosure research project is to identify disclosure issues and develop new, or clarify existing, disclosure principles in IFRS Standards, with the aim of:
- Helping entities exercise better judgment and communicate information more effectively;
- Improving the effectiveness of disclosures for the primary users of financial statements; and
- Assisting the IASB develop and improve disclosure requirements in IFRS Standards.
IASB Discussion Paper
The IASB published the Discussion Paper DP/2017/1 Disclosure Initiative-Principles of Disclosure ('IASB DP') on 30 March 2017, with comments requested by 2 October 2017.
The IASB DP considers the existing requirements in IAS 1 Presentation of Financial Statements as a starting point with a view to either making amendments to IAS 1 or creating a new disclosure standard to replace parts of IAS 1.
EFRAG/ANC/FRC Discussion Paper
Information on the Discussion Paper Towards a Disclosure Framework for the notes, published in July 2012 by EFRAG in cooperation with the ANC and FRC, can be found at the following project site:
EFRAG's comment letter
In order to provide constituents with the maximum amount of time possible to consider the IASB DP, the EFRAG Board undertook a two-stage process in seeking the views of constituents:
- On 5 May EFRAG published preliminary responses to the questions in the IASB DP. The preliminary consultation document reflected the views of the EFRAG Technical Expert Group and was reviewed by the EFRAG Board as a basis for an initial public consultation.
- On 8 June 2017, EFRAG published a draft comment letter, which superseded the preliminary consultation document. EFRAG requested comments no later than 11 September 2017.
EFRAG conducted various outreach activities during the IASB DP's consultation period and considered the input received in its final comment letter. Below is list of all the events.
|Location||Organisers||Date||Attendance||Link to event|
|Denmark||DASC, DI and EFRAG||14 June 2017||30||here|
|Norway (User)||EFFAS, NFF, NASB and EFRAG||15 June 2017||15||here|
|Norway||NASB and EFRAG||15 June 2017||25||here|
|Belgium (User)||EFFAS, ABAF/BVFA, EFRAG and IASB||3 July 2017||24||here|
|UK||UK FRC and EFRAG||4 July 2017||50||here|
|Lithuania||Lithuanian Ministry of Finance, Lithuanian Accounting Authority and EFRAG||5 September 2017||30||here|
|France||ANC and EFRAG||6 September 2017||30||here|
|Germany||ASCG, AFRAC, Swiss FER and EFRAG||11 September 2017||10||here|
|Poland||PASC, AAP, NCSA and EFRAG||12 September 2017||70||here|
|Italy (User)||AIAF, EFFAS, OIC, EFRAG and IASB||18 September 2017||25||here|
On 12 October 2017, EFRAG published the final comment letter.
In the final comment letter EFRAG fully supports the aims of the IASB's Principles of Disclosure project. EFRAG also agrees with the description of the 'disclosure problem' insofar as it is acknowledged that the problem is multifaceted, includes behavioural aspects and that the requirements in IFRS Standards are not the only root cause. EFRAG considers that, in the next steps of the project, a high priority should be given by the IASB to a comprehensive review of standards-level requirements. The review should, in particular, aim to identify and remove any disclosure requirements that are disproportionate or redundant.
Lastly, EFRAG regrets that a number of other issues identified in its 2012 Discussion Paper Towards a Disclosure Framework for the Notes are not addressed in greater depth, in particular the boundaries of the financial statements and the effects of technology on Financial Reporting.
Detailed responses to the questions contained in the IASB DP are included in EFRAG's final comment letter here.
On 15 November 2017, EFRAG published a feedback statement summarising the comments received in response to its draft comment letter and how they had been considered in the drafting of its final coment letter.
At is March 2018 meeting, the IASB decided to perform targeted Standards-level review of disclosure requirements. Specifically, the IASB tentatively decided to:
- develop guidance for the IASB itself to use when developing and drafting disclosure requirements.;
- identify one or two IFRS Standards on which to test the guidance developed for the Board The objective of applying the guidance to the Standard(s) will be to improve their disclosure requirements to help stakeholders improve the usefulness of disclosures provided to the primary users of financial statements.
See EFRAG's project here.
15/11/2017 - EFRAG's feedback statement on the IASB's Discussion Paper DP/2017/1 Disclosure Initiative - Principles of Disclosure
EFRAG has published a feedback statement following the publication of its final comment letter on the IASB's Discussion Paper DP/2017/1 Disclosure Initiative - Principles of Disclosure.
12/10/2017 - EFRAG's comment letter on the IASB's Discussion Paper DP/2017/1 Disclosure Initiative - Principles of Disclosure
EFRAG has published its comment letter in response to the IASB's Discussion Paper DP/2017/1 Disclosure Initiative - Principles of Disclosure.
08/06/2017 - EFRAG's draft comment letter on the IASB's Discussion Paper DP/2017/1 Disclosure Initiative - Principles of Disclosure
EFRAG has published its draft comment letter in response to the IASB's Discussion Paper DP/2017/1 Disclosure Initiative - Principles of Disclosure and seeks for constituents' views on the proposals. Comments are requested by 11 September 2017.
05/05/2017 - EFRAG's preliminary responses to the questions in the IASB’s DP-2017-1 Disclosure Initiative - Principles of Disclosure
EFRAG has published its preliminary responses to the questions in the IASB's Discussion Paper DP/2017/1 Disclosure Initiative - Principles of Disclosure. Constituents' views will be sought by 11 September 2017.
IMPORTANT UPDATE: On 8 June 2017, EFRAG has published its draft comment letter in response to the IASB DP, which supersedes the preliminary consultation document. You can comment on EFRAG's draft comment letter by clicking here.