View all newsletters
Receive our newsletter - data, insights and analysis delivered to you
  1. News
October 11, 2017updated 03 Jan 2021 5:40pm

IFRS Foundation report case studies reveal how to improve disclosure and communication

By Stephanie Wix

The IFRS Foundation has published a case study report providing examples of how communication has been improved in IFRS financial statements of companies from different jurisdictions.

The report Better Communication in Financial Reporting—Making disclosures more meaningful includes case studies of six companies from different industries; Fonterra Co-operative Group Limited, Wesfarmers Limited, PotashCorp, ITV plc, Orange S.A. and Pandora A/S..

International Accounting Standards Board (IASB) chairman Hans Hoogervorst recognised that providing financial information in compliance with IFRS can be challenging for companies and he identified three common concerns raised by businesses; that there was not enough relevant information, too much irrelevant information and that information is communicated ineffectively.

However the case studies revealed that the six companies prioritised information relevant to stakeholders and presented it in a clear and simple manner which was easier for investors to read and understand for their decision making. The key factors that made the improvements possible, according to the report, were that; senior management supported the changes, companies engaged with investors to identify most relevant information, departments participated in the process, and the companies’ auditors, regulators and national standard-setters supported the process.

Yet the report also revealed that improving communication of information varied across jurisdictions because some are in the early stages of IFRS implementation. For example, Pandora A/S follows alternative performance measures not defined according to IFRS, as they believe non-GAAP measures provide valuable information to investors.

NEWSLETTER Sign up Tick the boxes of the newsletters you would like to receive. A roundup of the latest news and analysis, sent every Wednesday.
I consent to GlobalData UK Limited collecting my details provided via this form in accordance with the Privacy Policy
SUBSCRIBED

THANK YOU

Thank you for subscribing to International Accounting Bulletin