IAS 34 — Disclosure of information 'elsewhere in the interim financial report'
The IFRS Interpretation Committee received a request to clarify the meaning of “interim financial report” in IAS 34. The submitter believed that the definition of the term in paragraph 4 of IAS 34 is not sufficiently clear with respect of whether the “interim financial report” covers only the information reported under IFRS (i.e. IFRS interim financial statements) or other elements as well.
The submitter provided two current practices:
- View 1 – all required disclosures should be included in the interim financial statements; and
- View 2 – some of the disclosures required by IAS 34 may be given in the interim financial report, but outside of the interim financial statements.
The Staff believed that the guidance in paragraph 16A of IAS 34 referring to the inclusion of certain required disclosures “elsewhere in the interim financial report” is consistent with View 2. The Staff also proposed to amend the paragraph to clarify the meaning and to require the inclusion of a cross-reference from the interim financial statements to the location of this information.
One Board member was concerned that with the information being outside of the financial statements how the auditors would audit it. The response was that the Interpretation Committee had considered this issue: the information that has been included by cross-reference is considered as part of the financial statements and therefore, it should be audited as well.
The Board member proposed to include the above understanding in the Basis for Conclusions (BfC) for the Board’s decision to amend and clarify IAS 34 about the inclusion of information by cross-reference. Other Board members agreed.
The Board agreed with the Staff proposals for changes to IAS 34 (as modified with the drafting comment for the BfC).