EFRAG draft comment letter on the IASB's exposure draft of amendments to IAS 7

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11 Feb 2015

The European Financial Reporting Advisory Group (EFRAG) has issued a draft comment letter on the IASB exposure draft (ED) proposing amendments that would improve disclosure in financial statements on an entity’s financing activities and liquidity.

On 18 December 2014, the IASB issued ED/2014/6 Disclosure Initiative (Proposed amendments to IAS 7). The main objectives of the proposal are to (1) improved information about an entity's financing activities, excluding equity items and (2) Improved disclosures about the liquidity of an entity.

In its draft comment letter, EFRAG stated that consensus on the amendments has not been reached; however, the draft comment letter does provide different views from constituents on the reconciliation of cash flows from financing activities and disclosures about restrictions on cash and cash equivalents.

In addition, the EFRAG stressed that the IFRS Taxonomy should not be integrated into the IASB’s standard setting process because it believes that it will alter the IASB’s principle-based approach to standard setting.

Comments on the draft comment letter are due by 16 April 2015.

For more information, see the press release and draft comment letter on the EFRAG’s website.

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