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Disclosure initiative: Targeted standards-level review of disclosures

Date recorded:

Cover Paper (Agenda Paper 11)

The purpose of this meeting was for the Board to decide whether the staff can begin the balloting process on Exposure Draft (ED) Targeted Standards-level Review of Disclosures—Amendments to IAS 19 and IFRS 13.

Due process steps and permission to begin the balloting process (Agenda Paper 11A)

This paper summarised the due process steps taken in the project and asks the Board whether the staff can begin the balloting process.  It also summarised the staff’s proposed structure for the upcoming ED and their analysis and recommendation regarding the length of the comment period.

Staff analysis

The staff’s analysis highlighted that, whilst the minimum comment period is 120 days, the Board should opt for a longer period in this instance as the project deals with a new approach to developing and drafting disclosure sections of IFRS Standards, which is likely to have significant consequences, and a longer period would allow staff more time to perform additional consultation activities. The staff therefore recommend that the Board allow a comment period of 180 days for the ED.

The staff’s analysis also demonstrates that the Board has completed all the required due process steps and some of the optional steps necessary to issue an ED. The staff’s tentative plan for the ED package is for it to contain the following sections:

  • (a) Amendments
  • (b) Illustrative Examples
  • (c) Basis for Conclusions
  • (d) Project Summary

Board discussion

The Vice-Chair stated that, although the Board should be cautious of the trend of allowing longer and longer comment periods, 180 days are warranted in this case. Constituents should have the time to test the disclosure system. One Board member said that the staff should gather evidence during the comment period as to how the disclosures for IFRS 9 and IFRS 15 have been implemented in practice. While both Standards were written before the Disclosure Initiative project, they both have objective-based disclosures. One Board member stated that the ‘Guidance for the Board’ should acknowledge how users will consume information in the future, rather than how they have consumed in the past.

Board decisions

All of the Board members supported the 180 day comment period and gave permission to ballet. Two Board members indicated that they might dissent from the proposals presented in the ED, but both Board members indicated that it depended on how the proposals are drafted.

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