Disclosure Framework : Board 's Decision Process

Entity-wide disclosures are required under Accounting Standards Codification (ASC) 280-10-50-40 through 280-10-50-42. The disclosures are required because every corporation does not report information in a similar fashion, and the disclosures would provide comparability of the financial statements among entities. For example, if a corporation uses a geographic approach in its financial statements, disclosing certain information about the products or services sold will make comparability to other companies much easier. The disclosures will also help with comparability within an entity if they decide to choose another method of reporting operating segments in the future. There are three types of entity-wide disclosures; products and services, geographic areas, and/or major customers. Every public company has to comply with the disclosures, even if the company has one reportable segment. The only exception to the entity-wide disclosures is if it is impractical to provide the information, such as it would be extremely costly to the corporation, or if the “internal reporting systems are not capable of gathering financial information by product or service by geographic area.” A disclosure should be made when entity-wide disclosures are impractical.

The purpose of this report is to research the accounting and reporting standards of the Financial Accounting Standards Board (FASB) and report the impact FASB may have on our company. The following research explains the history and purpose of FASB, the accountability requirements on public corporations, the effectiveness of FASB in setting standards in order to improve financial reporting in the public

The FASB mission is to “establish and improve standards of financial accounting and reporting that foster financial reporting by nongovernment entities that provides decision- useful information to investors and other users of financial reports.” (www.FASB.org)

This research project will analyze the recent changes in the disclosure requirements for income taxes. On July 26, 2016 the Financial Accounting Standards Board (FASB) published for comment a proposed Accounting Standards Update (ASU) on Income Taxes (Topic 740): Disclosure Framework—Changes to the Disclosure Requirements for Income Taxes. The FASB had received 52 comment letters by the due date of September 30, 2016. The Board issued the amendments in the proposed Update on Topic 740 as part of the disclosure framework project. The new ASU would change, add, and cancel previous income tax accounting disclosure standards. The new amendments would include requirements for all entities (public and private) to disclose certain

This paper will analyze these views as they apply to the discloser of segment information for public entities as required by topic 280 of the FASB accounting standards codification, and discussed in Statement of Financial Standards No. 131 (“SFAS 131). The paper is structured as follows: Section II provides an overview of the objective and general purpose of financial reporting and the qualitative characteristics off useful financial information as determined by the Financial Accounting Standards Board (“FASB”), section III introduces the concept of segment reporting and outlines the requirements for disclosures of segment information for public companies, section IV evaluates the relevance of

The purpose of this research report is to understand of two important concepts from the Conceptual Framework for Financial Reporting----the objective of general purpose financial reporting and qualitative characteristics of useful financial information. In this report, Myer Holdings Ltd is as an example to describe these two concepts. This report includes the analysis on whether the disclosure of PPE from Myer Holdings Ltd meets the requirements of AASB 116, especially the requirements of objective

In order to help users of financial statements better understand the public entity 's operations and make more informed decisions about the public entity 's operating matters, publicly-held companies are required to disclose the segments and related information about the different types of activities in which the company engages and the different economic environments in which the company operates. According to FASB Accounting Standards Codification, public entity is a business entity or a not-for-profit entity that issues securities in public market or is required to files financial statements with SEC. FASB provides guidance regarding the disclosure in the notes to financial

In their comment letters to FASB, Ernst and Young gave their support to FASB’s attempt to develop a disclosure framework, but are worried the exposure draft does not go far enough to implement change.41 Ernst and Young would like to see the FASB evaluate disclosure requirements every five years for relevance or add a mechanism that will cause requirements to “sunset [if not] reaffirmed.”42 KPMG and Ernst and Young were critical of FASB exclusion of employee benefit disclosures from the framework, while Deloitte & Touche and PricewaterhouseCoopers believed that they can be excluded. EY and KPMG are concerned that the exclusion of employee benefits will create confusion when new standards are issued.43 Deloitte

The definition of disclosure in was confused, the concept of disclosure in AASB 111 & AASB 118 always resulted in revenue information which was inadequate or confused for investors to read a revenue information on financial statement. Such as, in AASB 111 & AASB 118 some of revenue information without explaining how the revenue should be in the financial statements.

This increased disclosure is a result of the efforts of the SEC and the FASB. The pronouncements issued by these organizations include many disclosure requirements that are designed to improve the financial reporting process. Numerous reasons can be cited for this increased emphasis on disclosure requirements. Some of the more significant reasons include (a) the complexity of the business environment, (b) the necessity for timely financial information, and (c) the use of accounting as a control and monitoring device. Notes to Financial Statements 3. (S.O. 2) Notes are an integral part of the financial statements of a business enterprise. Although they are normally drafted in somewhat technical language, notes are the accountant 's means of amplifying or explaining the items presented in the main body of the statements. Many of the note disclosures which are common in financial accounting are discussed and presented throughout the text. The more common note disclosures are as follows: a. Significant Accounting Policies. This information is designed to inform the statement reader of the accounting methods used in preparing the information included in the financial statements. Accounting policies of a given entity are the specific accounting principles and methods currently employed and considered most appropriate in the circumstances to present fairly the financial statements of the

In addition, a number of new business practices had developed that were not contemplated at the time of the original paper. Finally, several surveys of our members highlighted serious deficiencies in the financial reporting framework, problems that hampered their ability to analyze companies and make wellinformed financial decisions. Consequently, those CFA Institute staff and volunteer members who have the responsibility of advocating for high-quality financial reporting thought that the time had arrived for the views in the white paper to be refreshed and extended to better reflect the changed circumstances. Once the work was underway, however, the project scope was expanded to consider both conceptual issues as well as revisions to financial statement display—that is, the business reporting model in its entirety. A special group of CFA Institute volunteer members was assembled—the Business Reporting Subcommittee—and tasked with developing the new paper. The Subcommittee comprised a subset of members from two existing standing CFA Institute committees: (1) the Global Financial Reporting Advocacy Committee (GFRAC), which was responsible for addressing proposals of the International Accounting Standards Board (IASB), and (2) the Financial Accounting Policy Committee (FAPC), which had similar responsibilities for proposals of the U.S. Financial Accounting Standards Board (FASB). The Subcommittee held extensive discussions over the next

The article discusses that in 1976 the U.S. Supreme Court ruled in one case that omitted financial statement information altering a reasonable investor’s decision proves the material nature of the information. The article continues by describing that lower courts earlier ruled that all financial information whether material or not must have full disclosure in a company’s financial statements. The rejection of the lower courts’ ruling by the U.S. Supreme Court gives the investor the ability to focus on the aspects of the financial statements that are most important by allowing the elimination of minute details (Sauer 2007, 317-357). In essence, this ruling allows for the elimination of financial information below the determined materiality threshold unless otherwise required by the ruling of a regulatory body.

ICAEW made nine recommendations about financial reporting disclosures in 2013 to solve current disclosure overload problem. This report will mainly argue against recommendation four. Choosing this prospect because one of the objectives of the Financial Conduct Authority (FCA) is to protect consumers from being taken advantage of by other informed participants in the capital market. Among all the suggestions, disclosing different reports for different users has the most significant influence on investors and capital market.

In the recent years, as the reporting environment becomes more and more complex, there has been a substantial increase in report length, and financial reports have simply become too long for investors to read, boilerplate, redundant, immaterial, irrelevant data, making disclosures difficult to assess. The purpose of financial reporting of conceptual framework is to provide financial information about entity that is useful to investors, clutter in financial reporting contradicts the objective of general purpose financial reporting outlined in the IFRS framework,

Disclosure is the communication of various details regarding the activities of the business which are to be disclosed either statutorily or otherwise, and it is to convey a true and fair view of the operating results and financial position to the users of financial reports. The study points out that the effective corporate reporting can only be achieved by a voluntary change in the corporate reporting philosophy. In order to achieve high standards of corporate reporting