Report of the Effects Analysis Consultative Group published

  • EACG (Effects Analysis Consultative Group) (mid blue) Image

28 Nov 2014

The Effects Analysis Consultative Group - an independent group of experts that was established by the IFRS Foundation Trustees as a result of its strategy review in 2012 - presented its final report to the Trustees who welcomed the conclusions of the report on topics such as fieldwork and the reporting of likely effects.

The Effects Analysis Consultative Group (EACG) was established in 2013 to provide independent advice to the IASB on how it should consider the effects of changes it develops to its financial reporting requirements (IFRS). Membership of the EACG includes representatives from a geographically and professionally diverse group of stakeholders.

The report that has now been presented to the Trustees and that is also publicly available is intended to support the IASB in further embedding effects analyses within its due process, with the objective of strengthening the standard-setting process.

The EACG’s report identified a series of recommendations among which are the following:

The IASB should assess and explain how general purpose financial reports are likely to change because of new requirements, and why those changes will improve the quality of general purpose financial reports. Furthermore, the IASB should explain why it considers those changes to be justifiable, demonstrating how it assessed the likely effects on the direct costs to preparers of meeting the new requirements and the related costs to users.

The IASB should work co-operatively with local standard-setters so that it can plan its fieldwork and outreach to see whether there are opportunities to organise fieldwork in ways that are mutually beneficial for the IASB and those local jurisdictions.

The IASB should plan its fieldwork so that it is proportionate to the changes in financial reporting being proposed. A more pervasive or significant potential change would normally warrant a more comprehensive assessment programme. The type, and depth, of fieldwork undertaken should also reflect the stage of development of the project.

The IASB should aim to undertake consultation that is geographically broad-based so that its Standards are written with principles that can be applied globally. Other accounting standard-setters can help by providing the IASB with analysis and information about factors and possible effects that might be unique to their jurisdiction.

The IASB should make available information about the nature of fieldwork and outreach that it has undertaken. This information should be made available throughout the development of the project.

The format of the analysis of the likely effects of a proposed change in financial reporting should reflect the stage of the proposals. When a new Standard is issued, the IASB should generally prepare a separate Effects Analysis Report.


The full EACG report as well as the press release are available on the IASB's website.

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