The Governmental Accounting Requirements Board launched a ideas assertion Thursday to supply a conceptual framework for its work on word disclosure necessities for state and native governments.
GASB has been researching and reexamining its present word disclosure necessities, and the brand new doc is a part of that.
The ideas included within the steering give GASB some standards it could use to persistently consider the long run necessities for footnotes to monetary statements within the standard-setting course of. In addition they might assist stakeholders, resembling authorities accountants, perceive the basic ideas underlying word disclosure necessities that can be contained in future GASB pronouncements.
Ideas Assertion No. 7, “Communication Strategies in Normal Function Exterior Monetary Stories That Include Primary Monetary Statements: Notes to Monetary Statements,” spells out particular ideas, together with:
- The aim of notes to monetary statements;
- The supposed customers of word disclosures;
- The sorts of info that ought to be disclosed in notes;
- The sorts of data which are inappropriate for word disclosures; and,
- The quantity of significance that info disclosed in notes to monetary statements ought to have.
A key idea within the steering is “essentiality.” The doc says notes to monetary statements are important to creating financial, social, or political selections or assessing accountability. The ideas assertion additionally identifies the traits of important info: The data has or is anticipated to have a significant impact on customers’ analyses for making selections or assessing accountability; and a breadth or depth of customers make the most of or are anticipated to make the most of the knowledge of their analyses for making selections or assessing accountability.
In accordance with the assertion, info disclosed in notes to monetary statements ought to correspond to the reporting models offered within the monetary statements.
GASB issued an publicity draft on this subject again in early 2020 and later issued a revised draft in July 2021 to have in mind the suggestions it acquired on the earlier draft and ask for additional feedback on the proposed revisions.