The AICPA’s Financial Reporting Executive Committee (FinREC) submitted comments to the Financial Accounting Standards Board’s (FASB) Exposure Draft, Income Taxes (Topic 740)—Disclosure Framework—Changes to the Disclosure Requirements for Income Taxes.
In the Exposure Draft, the FASB indicates the primary objective is to “improve the effectiveness of disclosures required by generally accepted accounting principles in the notes to financial statements by facilitating clear communication of information that is most important to financial statement users.”
FinREC expressed support in its letter for the FASB’s intent to modify disclosure requirements to result in more effective, decision-useful information about income taxes. As stated in the letter, FinREC believes that the proposed amendments will result in more effective disclosures by focusing on information that is important to the financial statement users.
However, the letter also noted a few matters of particular concern, such as some areas where the proposed requirements could pose operability and auditability issues and impose significant incremental costs.