Climate-related and Other Uncertainties in the Financial Statements [Research]
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Next steps: |
The IASB, having reviewed the application of IFRS Accounting Standards and explored possible standard-setting enhancements, will next discuss the project's direction. |
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Last updated: |
March 2024 |
Overview
The purpose of this Climate-related Risks in the Financial Statements project is to explore whether and how financial statements can better communicate information about climate-related risks.
In the IASB’s Third Agenda Consultation, stakeholders expressed a view that entities might: (i) apply IFRS Accounting Standards inconsistently to climate-related risks; and (ii) disclose insufficient information in the financial statements about climate-related risks.
In response to that feedback, the IASB decided to add this maintenance project to its Work Plan at its meeting on March 23, 2023, which will aim to:
- research the causes of stakeholders’ concerns about inconsistent application and insufficient information;
- research whether the IFRS Foundation’s educational material on the effects of climate-related matters on financial statements and the application of the ISSB's future standard on climate-related disclosures help to address these concerns; and
- consider whether and what actions might be needed.
This project and the work of the International Sustainability Standards Board (ISSB) complement each other in facilitating connectivity in general purpose financial reports. The IASB will consider the work of the ISSB to the extent that it applies to the financial statements.
In September 2023, the IASB decided to rename the project to "Climate-related and Other Uncertainties in the Financial Statements" to stress that the principles-based IASB standards apply to any risk an entity incurs.
As part of this project, the IASB has now brought together in one place all its available materials supporting companies in their reporting of the effects of climate-related and other uncertainties in the financial statements.
Access the project summary on the IASB’s Web site.
Other developments
September 2023
In September 2023, the IASB staff updated the work plan to indicate that the Board plans to make a decision on the project direction in H1 2024.
July 2023
On January 30, 2023, the IASB staff updated the work plan to indicate that the Board plans to review the results of the research by its staff in September 2023.
March 2023
On March 23, 2023, the IASB has launched a new project aimed at exploring ways for entities to provide better information about climate-related risks in their financial statements.