Disclosure Framework American Accounting Association Financial Accounting and Reporting Section February 23, 2011 Akwasi A. Ampofo, FASB Project Manager Phil Shane, FASB Academic Fellow. Disclaimer. The views expressed are my personal views and do not represent positions of the FASB.
Disclosure FrameworkAmerican Accounting AssociationFinancial Accounting and Reporting SectionFebruary 23, 2011Akwasi A. Ampofo, FASB Project Manager Phil Shane, FASB Academic Fellow
The views expressed are my personal views and do not represent positions of the FASB.
Positions of the FASB are arrived at only after extensive due process and deliberations.
(1) The most frequently required disclosures relate to amounts recognized in the financial statements, particularly to disaggregating them and providing relevant measures other than the measure in the financial statements—disaggregation of recognized amounts represents 26 percent of all required disclosures.
(2) Six subjects—stockholders' equity, leases, pensions, income taxes,
other postretirement employee benefits, and commitments and contingencies—account for 43 percent of all required disclosures; five standards—SFAS 13, 87, 88, 106, and 109—account for 28 percent.
(3) Few disclosures explicitly provide information on future cash inflows or outflows.
(4) Few disclosures provide measures of unrecognized items.
(5) Increased disclosure requirements over time with few disclosures eliminated.
Q1. How could the FASB staff’s disclosure categories be improved? What is missing?
Q2. Can the Board and staff derive principles of disclosures (deductive) from the categories of disclosures (inductive)? If yes, explain.
Q3. How would you differentiate between categories 4 and 5 of FASB staff disclosure categories? That is, what is the difference between risk and uncertainty regarding disclosures?
Q4. Do you think creating a 6th category for disclosures that do not fit into categories 1 to 5 is appropriate? Why or why not?
Q5. Do you have any suggestions to reduce disclosure overload in financial reporting?
Q6. What additional feedback would you provide to the disclosure framework project team?