10 February 2009

EFRAG concerned about IASB/FASB discussion paper on Financial Statement Presentation

The proposed rule is neither the only, nor the best way to achieve cohesiveness, EFRAG criticizes. EFRAG is also concerned about the proposed method of presenting operating cash flows and criticizes the proposed reconciliation schedule.

EFRAG has a number of concerns on the IASB/FASB paper.

 

To apply an ‘everything in the same order and disaggregated to the same extent’ rule is neither the only, nor the best way to achieve cohesiveness, EFRAG criticizes the IASB/FASB discussion paper. It is very important that the implementation of the cohesiveness principle is done in a way that is thoughtful and pragmatic, EFRAG underlines.

 

EFRAG also does not support the proposal that the new standard should require use of the direct method of presenting operating cash flows. EFRAG doubts that such an approach provides useful additional information and prefers the indirect method of presenting operating cash flows in the statement of cash flows.

 

Also, the proposed reconciliation schedule provides little value to justify the cost of preparing the schedule in the form proposed. EFRAG therefore calls to scale down the proposal which should focus instead on re-measurements and large non-cash items.

 

Deadline for comments is 9 April 2009. 

 

Full paper

 

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