After nearly five years of proposals, feedback, and increased enforcement, the Financial Accounting Standards Board is shutting down its dormant project to write a new accounting standard for loss contingencies.
The board voted 5-2 during a regular board meeting to remove from its technical agenda its project on disclosures about certain loss contingencies, concluding the existing accounting standard that dates back to 1975 is adequate. “As a result of the increased scrutiny of loss contingency disclosures in recent years, the Board concluded that improvements to financial reporting are more likely to be achieved through robust compliance than through additional standard setting,” said FASB Chairman Leslie Seidman in a written statement.
