FASB approves new requirements for disclosure of big expenses by segment
Jul 26, 2023
On July 26, 2023, the Financial Accounting Standards Board (FASB) approved new requirements on disclosure of significant expenses provided to executives. It wants the requirements to focus on disclosure of significant expenses not only provided to executives, but also regularly reviewed by them. The requirements, for which the FASB issued a proposal in October, are set to go into effect for annual reporting periods beginning after December 15, 2023, though companies can adopt them early.
The information is limited to companies that already provide segment information to the chief operating decision maker, an accounting designation used by the FASB and its international counterpart, the International Accounting Standards Board. Businesses that don’t currently share this information with their chief executive, chief operating officer or their board’s executive committee won’t have to disclose it to investors. These businesses will have to state in their disclosure that their senior executives don’t receive this data. Companies with only one business segment will also have to report their significant expenses.
Review the news release on the WSJ website.
