Disclosure Framework / Disclosure Initiative [joint with FASB]

Date recorded:

Project Update (IASB Agenda Papers 11A–11B)


The IASB staff provided a project update on the IASB’s Disclosure Initiative—in particular the Principles of Disclosure and Targeted Standards-level Review of Disclosures projects.

Specifically, the staff provided an overview of the background of the Disclosure Initiative and the Principles of Disclosures Discussion Paper (PoD DP). Further, the staff gave an update on the planned Guidance for the IASB for developing and drafting disclosure objectives and requirements and introduced the three-step approach:

  • Step 1: How will the IASB use disclosure objectives in the future?
  • Step 2: What process will the IASB use to develop the content of disclosure objectives and requirements?
  • Step 3: How will the IASB draft disclosure objectives and requirements?

In addition, the staff touched on the selection of Standards for targeted review of disclosures (see summary below at the IASB only Disclosure Initiative session).

Staff recommendation

As this was an education session, the staff did not recommend any decisions. The staff asked the FASB members how the FASB approaches the development of guidance for itself for its Disclosure Framework project and if they have any advice or thoughts on the IASB developing guidance for itself to use in developing disclosure objectives and requirements in the future. The staff also asked the FASB members how they selected Standards for review and if they have any advice reviewing the disclosure requirements of similar Standards to some of those shortlisted by the IASB—for example Income Taxes, Defined Benefit Plans and Fair Value Measurements.


The FASB discussed the three-step approach and expressed agreement with the approach. One FASB member stated that their project became controversial when they started discussing materiality and that communication is very important in this regard.

The Boards discussed testing of disclosure requirements and how best to filter all possible disclosure requirements down to the ones that fit the cost-benefit criterion. One FASB member asked how materiality and disclosure requirements interact. The IASB staff replied that this is not something the Board is dealing with but the published Practice Statement on materiality should help to start a conversation in practice. An IASB Board member added that the 2014 amendments to IAS 1 clarified that materiality applies to all items in the financial statements.

The FASB Chairman warned that even objective-based disclosures would be turned into checklist-style requirements by accounting firms and preparers. Also, preparers might assess that an objective-based disclosure might not be applicable to the entity, although it might be objectively material. Especially small preparers might require a list of disclosures.

Disclosure Framework (FASB Agenda Paper 11C)


The FASB staff gave an update on the FASB’s Disclosure Framework project. After introducing the background of the project, the staff presented the areas of focus for the project.

Staff recommendation

There paper did not contain any recommendations.


There was no significant discussion of the FASB’s project.

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