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FASB and CICA invite comments on disaggregated information.

The Financial Accounting Standards Board and the Canadian Institute of Chartered Accountants Accounting Standards Board jointly issued an Invitation to Comment titled Reporting Disaggregated Information by Business Enterprises. It marks the first time the FASB developed a comment document with another standard-setting body.

Standards on disaggregated information, both in the United States and in Canada, currently are being reconsidered. Analysts and others have raised concerns about the effects of recent changes in consolidation policy on the usefulness of reporting this information. These changes include ending the practice of excluding from consolidation those subsidiaries whose operations are not homogenous with their corporate parents.

"A shared objective of national and international standard-setting bodies," said FASB Chairman Dennis R. Beresford, "is to work together to 'internationalize' accounting standards, and an important step toward achieving that goal is for two or more countries to adopt a common improvement to their existing accounting standards."

The primary issues addressed in the invitation to comment include

1. Whether current industry and geographic segment requirements result in adequate informative disclosures.

2. Whether disaggregated information should be required in interim reports.

3. Whether there are other bases of disaggregation that would be helpful to users.

4. Whether enterprises should be allowed to omit segment disclosures if the disclosures are competitively harmful.

Comments are requested by September 30, 1993. Single copies of the document are available gratis until that date from the FASB order department by calling (203) 847-0700, ext. 555.

Research report available. In February, the FASB published a research report, Reporting Disaggregated Information, that reexamined standards for reporting financial data by industry segment, geographic area and other bases for disaggregating business entities. The study, in part, traces the evolution of current disaggregated disclosure standards in the United States and worldwide and describes disaggregated disclosures issues confronting the FASB. It is recommended reading for those planning to respond to the invitation to comment.

Copies of the report are available for $25, prepaid, from the FASB order department, P.O. Box 30816, Hartford, Connecticut 06150. Connecticut orders should add 6% sales tax.
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Title Annotation:Canadian Institute of Chartered Accountants Accounting Standards Board
Publication:Journal of Accountancy
Date:Jul 1, 1993
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