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IASB Chair discusses strengthening the relevance of financial reporting

  • IFRS - IASB Image

Jun 20, 2019

On June 20, 2019, the In­ter­na­tional Ac­count­ing Stan­dards Board (IASB) made avail­able a speech by IASB Chair Hans Hoogervorst at the IFRS Foundation Conference in London, in which he discussed the Board’s plans to maintain and strengthen the relevance of financial reporting in primary financial statements and management commentary.

Mr Hoogervorst began with an overview of the primary financial statements (PFS) project and provided comments related to subtotals (definition of operating profits and profit before financing and tax), labeling non-GAAP measurement as ‘management performance measures’, improvements to disaggregation, the disclosure of ‘unusual’ items of income or expenses, and the impact the PFS proposals will have to the quality and usefulness of the income statement.

Next, Mr Hoogervorst commented on the importance of management commentary (a topic he also covered in similar speech at the Climate-Related Financial Reporting Conference in April 2019) to provide broader financial information, such as the impact of intangibles. He mentioned the need to update the Management Commentary Practice Statement to accommodate new advances made in the environmental, sustainability and governance reporting space.

For more information, see the transcript of his speech on the IASB’s website.

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