A commentary on accounting standards and the disclosure problem: Exploring a way forward

Hamilton Elkins and Gary Entwistle

Journal of International Accounting, Auditing and Taxation, 2018, vol. 33, issue C, 79-89

Abstract: The ‘disclosure problem’ continues to pose a challenge to the accounting standard setting community. To help confront this problem, in this commentary we present an exploratory approach for the review and evaluation of note disclosure standards rooted in the conceptual framework’s enhancing qualitative characteristics of comparability, verifiability, timeliness, and understandability. In our approach, note disclosure – an enhancement – is necessary and justified when it rectifies a material information deficiency in the primary financial statements. Our approach requires that the information deficiency, the traceable enhancing qualitative characteristic, and the materiality rationale, are each clearly evident in the written accounting standard. We demonstrate an application of our approach with a case study using the International Accounting Standard (IAS) 1 disclosure guidance on capital structure.

Keywords: Disclosure problem; Standard setting; Enhancing qualitative characteristics; Conceptual framework; Note disclosure; IAS 1; Capital structure (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jiaata:v:33:y:2018:i:c:p:79-89

DOI: 10.1016/j.intaccaudtax.2018.11.003

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