IASB proposes changes to conceptual framework

Project would alter the foundational underpinning for IFRS financial reporting.

The International Accounting Standards Board (IASB) proposed changes to its conceptual framework, which provides a foundational underpinning for financial reporting under IFRS.

In an exposure draft, Conceptual Framework for Financial Reporting, the IASB proposes changes that would include:

  • A new chapter on measurement, describing appropriate measurement bases (historical cost and current value, including fair value) and the factors to consider when selecting a measurement basis.
  • Confirming that the statement of profit or loss is the primary source of information about a company's performance, and adding guidance on when income and expenses could be reported outside the statement of profit or loss in other comprehensive income.
  • Refining the definitions of the basic building blocks of financial statements, including assets, liabilities, equity, income, and expenses.
  • Placing more emphasis on the importance of providing information needed for investors to assess management's stewardship.
  • Reintroducing an explicit reference to "prudence" and explaining clearly what it means.

The IASB plans to issue a final conceptual framework next year. Comments are sought by Oct. 26 and can be made at the IFRS website.

SPONSORED REPORT

Tax reform changes are now in effect

With all the recent tax law changes, this year it’s more important than ever to make sure your clients’ tax situations are squared away before year end. This report provides necessary guidance to ensure 2019 starts without a hitch.

PODCAST

Using drones to enhance audits

Hermann Sidhu, CPA, global assurance digital leader at EY, walks us through EY’s exciting new project to use drones to help audit large warehouses and outdoor inventories.