Are you in compliance?

Don't miss out! Sign up today for our weekly newsletters and stay abreast of important GRC-related information and news.

Get updates on Compliance Week offerings, including new features, databases, research, and other resources, along with announcements of upcoming Webcasts, conferences, seminars, CPE/CLE opportunities and more.

Published every Thursday, Compliance Week Europe offers a condensed summary of risk, audit, and compliance news either originating in Europe, or of special interest to European compliance professionals. This newsletter will follow developments by the European Commission, as well as those of national governments across the region, or any U.S.-based news that might have consequence across the Atlantic. Frequency: weekly; Thursday a.m.

A fresh edition of Compliance Week delivered via e-mail and online every Tuesday morning, relentlessly focused on the disclosure, reporting and compliance requirements of our 25,000+ paying subscribers.

Published every Friday, Compliance Weekend was launched at the behest of subscribers, and offers a quick Plain English review of the week's key developments. We hope you enjoy this supplement to Compliance Week's Tuesday edition.

FASB Soon to Reveal Ideas on Disclosure Overload

Tammy Whitehouse | June 5, 2012

The Financial Accounting Standards Board will soon publish a discussion paper to outline its proposed solution for how to address rising concerns about disclosure overload.

In the coming weeks, the board will issue for public comment a discussion paper that will address three different areas that could affect present and future disclosure requirements, said FASB Chairman Leslie Seidman during a keynote address at Compliance Week 2012. “Let me emphasize that the purpose of this project is to improve disclosure effectiveness, not to single-mindedly reduce disclosure volume,” she said.

Seidman said disclosure requirements represent one of the most comment concerns she hears from virtually all stakeholders who have an interest in financial reports. “Many of those stakeholders tell me that financial reports are just too long—and, as a result, that they have become much less effective tools for communicating with investors,” she said. “Yet investors continue to say they want more information, particularly when there is a business downturn or failure. Often the information that these investors want is available in the financial statements—but it is hidden in plain sight.”

The board is working on developing a framework that would help the board establish consistent disclosure requirements focused on what matters most to users of financial statements, she said. In the discussion paper, the board will ask for feedback on the framework, which also will explain how reporting entities should evaluate which disclosures they need to make based on their own circumstances. That might even include helping a company determine when a particular disclosure is unnecessary and can be excluded from financial statement, she said.

The paper also will ask for view on how to organize disclosures to make it easier for users to find the information that is most critical. As an example, Seidman said, board members wonder if it would be helpful to users of financial statements to have a different ordering of disclosures. “We understand that some companies organize some of their notes in the order in which the disclosures became effective,” she said. “Surely there is a more logical order than that.”