On February 22, 2022, SEC Acting Chief Accountant Paul Munter issued a Statement titled “Statement on the FASB’s Agenda Consultation: Engagement with Investors and Other Stakeholders Vital to Development of High Quality Accounting Standards.”
After a brief review of the FASB’s Agenda Consultation project Dr. Munter states:
“It is critically important that the FASB, and the Trustees of the Financial Accounting Foundation (the “FAF”) in its important oversight role over the FASB, continue to improve processes for obtaining and considering investor and other stakeholder feedback, and for clearly communicating with those stakeholders regarding how that feedback has impacted the standard-setting process. On behalf of Commission staff in OCA, in this statement, we highlight below why engagement with investors and other stakeholders is vital to the FASB’s ability to develop high quality accounting and financial reporting standards, and we provide observations on the FASB’s standard-setting process, its agenda consultation, and the related ITC feedback from investors and other stakeholders.”
The Statement then provides the Acting Chief Accountant’s observations on the Agenda Consultation project in areas including:
- The Importance of Investors and Other Stakeholders to the Standard-Setting Process
- Overall Feedback and Making the Case for Change
- Disaggregation of Financial Reporting Information
- Climate-Related Transactions and Disclosures
- Digital Assets
As you read the Statement, you may want to focus on Dr. Munter’s discussion of the costs of preparing disaggregated information, the FASB’s goodwill project, and accounting and disclosures for digital assets.
The conclusion of the Statement includes this thought:
The financial reporting system’s collective objective of providing investors with high quality financial reporting demands that all stakeholders seek ways to improve and better address the needs of investors. In that regard, it is important that both the FAF and FASB focus on continued improvement in the fulfillment of their respective roles and responsibilities in the financial reporting system—especially in their efforts to more promptly address significant and evolving investor needs within the context of the financial statements.
As always, your thoughts and comments are welcome.