Disclosure Framework—Board's Decision Process
Last updated on January 12, 2017. Please refer to the Current Technical Plan for information about the expected release dates of exposure documents and final standards.
(Updated sections are indicated with an asterisk *)
The staff has prepared this summary of Board decisions for information purposes only. Those Board decisions are tentative and do not change current accounting. Official positions of the FASB are determined only after extensive due process and deliberations.
Project Objective and Overview
Due Process Documents
Decisions Reached at Last Meeting
Tentative Board Decisions Reached to Date
Board/Other Public Meeting Dates
Resource Group and Other Outreach
Project Objective and OverviewThe objective and primary focus of the Disclosure Framework project is to improve the effectiveness of disclosures in notes to financial statements by clearly communicating the information that is most important to users of each entity’s financial statements. (Although reducing the volume of the notes to financial statements is not the primary focus, the Board hopes that a sharper focus on important information will result in reduced volume in most cases.)
The objective of improving effectiveness will require development of a framework that promotes consistent decisions about disclosure requirements by the Board and the appropriate exercise of discretion by reporting entities. To achieve this objective, the Disclosure Framework project comprises two components: the Board’s Decision Process and the Entity’s Decision Process.
The Board’s Decision Process is intended to aid the FASB in identifying disclosures to be considered when setting disclosure requirements for individual accounting standards and evaluating existing disclosures requirement. A disclosure that may be considered by the FASB will not automatically be required. This process involves the FASB and its staff continuing to evaluate the costs, negative consequences and benefits associated with each potential disclosure at the standard level.
Currently four disclosure areas are being evaluated as part of the Disclosure Framework project. Each review will include (1) evaluation of existing disclosure requirements within the Topic after applying the concepts in the Board’s Decision Process and (2) promotion of the appropriate use of discretion by entities specifically within the Topic. The Board’s decision process and the entity’s decision process are being used in conjunction to modify the disclosure sections in the following Topics:
- Fair Value Measurement (820-10-50)
- Defined Benefit Plans (715-20-50)
- Income Taxes (740-10-50)
- Inventory (330-10-50)
The FASB staff has developed a “Q&A: FASB’s Disclosure Framework Project” fact sheet which can be viewed here.
Due Process DocumentsOn March 4, 2014, the FASB issued the Exposure Draft, Conceptual Framework for Financial Reporting: Chapter 8 Notes to Financial Statements. The due date for comment letters was July 14, 2014.
- Download the Exposure Draft, Conceptual Framework for Financial Reporting: Chapter 8 Notes to Financial Statements
- Download the comment letters on the Exposure Draft
- Download the comment letter summary on the Exposure Draft
- Read the press release on the proposed chapter of the Conceptual Framework
- Read the FASB In Focus which summarizes the proposed chapter of the Conceptual Framework
On July 12, 2012, the Board issued Invitation to Comment – Disclosure Framework. The original due date for comment letters was set for November 16, 2012 but due to Hurricane Sandy the comment period was extended two weeks to November 30, 2012.
- Download the Invitation to Comment—Disclosure Framework
- Read the comment letters on the Invitation to Comment
- Read the comment letter summary on the Invitation to Comment
- Read the news release introducing the Invitation to Comment
- Read the FASB In Focus which summarizes the Invitation to Comment
- Listen now or Download In Focus: The FASB Disclosure Framework Project Webcast
Decisions Reached at Last Meeting (February 18, 2015)The Board decided that when setting disclosures requirements, it would not distinguish between a minimum and expanded set of disclosures.
The Board also decided that, in general, the objectives for disclosures within each Topic would be developed using the decision questions from the proposed concepts that are used to identify relevant disclosure requirements
Tentative Board Decisions Reached to Date (as of February 18, 2015)Tentative Board Decisions to Date
*Next StepsThe staff is using comments received on the Exposure Draft, as well as the Topic-specific disclosure reviews being performed to understand how the proposed chapter should be modified. Please refer to the current technical plan for information about the project timeline.
Additionally, the FASB will host a public roundtable meeting on the Board’s decision process under the disclosure framework and on materiality in Norwalk, Connecticut on March 17, 2017. The roundtable meeting is an important part of the Board’s due process on the Exposure Drafts. The first session of the roundtable will be an opportunity for those who have submitted a comment letter on the Exposure Draft of Chapter 8 or any of the four Topical reviews (defined benefit plans, fair value measurement, income taxes, and inventory) to discuss with the FASB the effects of the proposed concepts on disclosures. The second session is an opportunity for those who have submitted a comment letter on either materiality Exposure Draft (Chapter 3 or proposed Update on Topic 235) to discuss their feedback with the FASB.
To ensure that a variety of perspectives is received, the Board is seeking participation from preparers, auditors, investors, and others. Those who desire to participate in one of the roundtable sessions should notify the FASB by submitting an online participation form by February 27, 2017. The roundtable meeting can accommodate a limited number of participants. Depending on the number of responses received, the Board may not be able to accommodate all requests to participate.
Board/Other Public Meeting DatesThe Board meeting minutes are provided for the information and convenience of constituents who want to follow the Board’s deliberations. All of the conclusions reported are tentative and may be changed at future Board meetings. Decisions become final only after a formal written ballot to issue a final standard.
|February 18, 2015||Board Meeting—Board’s Decision Process|
|November 19, 2014||Board Meeting—Materiality|
|September 10, 2014||Board Meeting—Comment Letter Summary and Possible Next Steps|
|November 6, 2013||Board Meeting—Interim Reporting, Scope of the Board’s Decision Process, and Permission to Ballot|
|October 9, 2013||Board Meeting—Additions and other Changes to the Board’s Decision Process and Interim Reporting|
|August 7, 2013||Board Meeting—The needs of providers of resources to not-for-profit entities and Line Items Decision Questions|
|July 25, 2013||Board Meeting—Role of the Notes, and SEC Disclosure Overlap within the Financial Report, and Other Regulatory Disclosure Overlap outside the Financial Report|
|June 19, 2013||Board Meeting—Forward-Looking Disclosure Information, Decision Questions, and Changes to the Technical Plan|
|February 13, 2013||Board Meeting—Comment Letter Summary and Analysis of Comments and Possible Next Steps|
|April 25, 2012||Board Meeting —Interim Disclosures and Cost Consequence|
|August 24, 2011||Board Meeting—Decision Process for Disclosures about Line Items|
|August 18, 2010||Board Meeting—Objectives, Principles, and Criteria for Use in Setting Standards for Required Disclosures of Financial Information|
July 8, 2009
Board Meeting—Agenda Announcement
Public OutreachOn December 1, 2014, the FASB held a forum to discuss financial disclosures at Pace University in New York City.
Read the media meeting recap from the forum discussion on financial disclosures
Download and listen to the audio replay of the forum
In 2012, the FASB, in conjunction with the Center for Audit Quality (CAQ), held two forums on disclosure effectiveness designed to encourage dialogue among a wide range of financial reporting stakeholders on improving the effectiveness of disclosures in notes to financial statements and other parts of the financial reporting package. The forums were held at Columbia University’s Center for Excellence in Accounting and Security Analysis in New York City on October 4, and at the Stanford University Graduate School of Business in Stanford, California, on October 8.
- Download the Summary of Observations from Two Forums on Disclosure Effectiveness
- Read the media advisory about the disclosure effectiveness forums
Resource GroupThe Board established a resource group to help identify key issues with existing disclosures and evaluate proposed solutions. The membership of that group includes academics, analysts, auditors, preparers, and regulators. The staff consults informally with members of the resource group as needed. The group met with Board members and staff on October 28, 2011. Future meetings will be scheduled if necessary.
Background InformationOn July 8, 2009, the FASB chairman announced (press release) the addition of a new agenda project aimed at establishing an overarching framework intended to make financial statement disclosures more effective, coordinated, and less redundant. The project was added in response to requests and recommendations received from several constituents, including the Investors Technical Advisory Committee (ITAC) and the Securities and Exchange Commission’s (SEC) Advisory Committee on Improvements to Financial Reporting (Recommendations 1.2 and 1.3).
The staffs of the Board and the European Financial Reporting Advisory Group (EFRAG) have cooperated in the development of the ideas discussed in this Invitation to Comment and a similar discussion paper issued by EFRAG.
*Contact InformationNick Cappiello
Assistant Project Manager
Postgraduate Technical Assistant
Postgraduate Technical Assistant