Analysis of International Reactions to IASB/FASB new Approach towards the Presentation of an Entity’s Performance
Author:
Assistant Prof. Victor-Octavian MÜLLER, Univ. Prof. Dumitru MATIŞ, Ph. D., Assistant Prof. Ionel-Alin IENCIU, Ph. D.
JEL:
M41
DOI:
Keywords:
performance presentation, statement of comprehensive income, disaggregation of expenses, financial reporting
Abstract:
The way an entity presents its performance is of vital importance within the communication process with its environment. The present article analyzes both quantitatively and qualitatively the reactions of the accounting world to two IASB/FASB proposals regarding the presentation of an entity’s performance. These proposals formulated within the discussion paper Preliminary Views on Financial Statement Presentation (October 2008) focus on the presentation of comprehensive income within a single statement and the disaggregation of expenses both by their nature and function. While in the first case, the reactions have been relatively balanced, in the second case respondents showed a strong disagreement. Moreover, for the first proposal, the results indicated significant differences between the negative position of European organizations and the positive opinion of US organizations, respectively between the unfavorable position of the industry & services cluster and the favorable opinion of financial analysts and accounting profession. \r\n\r\n\r\n