FinREC Comments on IASB’s Exposure Draft, Conceptual Framework for Financial Reporting 

Published December 22, 2015

The Financial Reporting Executive Committee (FinREC) of the American Institute of CPAs (AICPA) has submitted comments to the International Accounting Standards Board (IASB) on its Exposure Draft ED/2015/3, Conceptual Framework for Financial Reporting.

FinREC wrote in its comment letter that it supports the Board’s effort to revise the Conceptual Framework to improve financial reporting by providing a more complete, clear, and updated set of concepts.  “We believe the revised Conceptual Framework will serve as a useful tool in standard setting,” the November 24 FinREC letter to IASB stated.

FinREC made specific recommendations about proposed changes in the Exposure Draft.  Among the comments are that FinREC supports the way “prudence” is described within the concept of neutrality, as the exercise of caution when making judgments under conditions of uncertainty, and that a complete set of financial statements should include a statement of cash flows.

Additionally, the FinREC letter stated, “We observe that the revised Conceptual Framework does not distinguish between revenue and expenses and gains and losses.  We believe that making that distinction would be helpful.  We also observe that other income statement concepts such as other comprehensive income are not fully developed.  Furthermore, we believe the Conceptual Framework should contain more-well-defined principles on when it is relevant to recycle and when it is not.”




A A A


 
© 2017 Association of International Certified Professional Accountants. All rights reserved.