The Disclosure Framework project was prompted, in large part, (although not solely by), recommendations contained in the Report and Recommendations of the SEC Advisory Committee on Improvements to Financial Reporting (aka CIFiR or The Pozen Committee).
As noted in FASB's summary of its Aug. 24 meeting at which the Disclosure Framework project was discussed, the board essentially agreed with the decision approach recommended by the staff, shown in the board handout, including the fact that the Disclosure Framework would be approached more from the perspective of a Concepts Statement than an individual accounting standard (Accounting Standards Update) per se.
Something that jumped out at me in reading FASB's meeting summary was a sentence that seemed to very crisply identify the objective of the Disclosure Framework project, in terms even more precise than those used when the project was first announced in FASB's 7/28/09 press release.
Specifically, FASB stated in its summary last week that:
The desired result [of the Disclosure Framework project] is a net
reduction in disclosure volume and a net increase in the
utility of the information disclosed.
One caveat before leaping on the 'reduction in disclosure volume' and 'increase in utility' goals: (I remind you of the disclaimer posted on the right side of this blog) - keep in mind the operative term, "net" - that there will be a "net" reduction in disclosure volume (so, leaving the door open for new disclosures to be added, with a concurrent reduction in some other disclosures).
Still, the hoped for net decrease in disclosure combined with a net increase in utility of those disclosures would be a welcome development for all those involved in the financial reporting process including preparers, auditors, investors, directors, educators, and others.
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