The report, entitled Losing the excess baggage — reducing disclosures in financial statements to what's important, was prepared in response to a request from the IASB (see our earlier story) and outlines the recommendations of the Joint Oversight Group of the ICAS and NZICA on which existing IFRS disclosures can be amended, reduced or eliminated.

The project used the IASB's 2010 Conceptual Framework for Financial Reporting as a guide, and considered disclosure requirements in all existing IASB standards, other than those not dealing with annual financial statements or which are subject to review under current IASB projects.

The report provides a detailed summary of changes to various standards, which if implemented, would have the effect of substantially reducing the volume of disclosures in financial statements. The ICAS and NZICA estimate implementation of the recommendations in the report could result in a 30% reduction in the volume of disclosure.

The reduction of the complexity of financial statements have arisen in many contexts in recent times. In April 2011, the Accounting Standards Board (ASB) of the United Kingdom Financial Reporting Council (FRC) published a report Cutting Clutter: Combating clutter in annual reports, which in common with the ICAS/NZICA report, noted that difficulties in reducing disclosure and applying the 'materiality' concept in the context of disclosure. The International Integrated Reporting Committee (IIRC) is also seeking to simplify and streamline various aspects of reporting through its integrated reporting initiative.

The ICAS/NZICA report has been presented to the IASB and an education session on it is being held at this week's IASB meeting.