In July 2024, the International Accounting Standards Board (IASB) published the Exposure Draft Climate-related and Other Uncertainties in the Financial Statements.
The Exposure Draft proposes eight examples illustrating how an entity applies the requirements in IFRS Accounting Standards to report the effects of climate-related and other uncertainties in its financial statements.
The IASB developed these illustrative examples in response to strong demand from stakeholders, particularly from investors. They expressed concerns that information about climate-related uncertainties in financial statements was sometimes insufficient or appeared to be inconsistent with information provided outside the financial statements. To respond to these concerns, the IASB’s proposed examples aim to:
- improve transparency of information in financial statements; and
- strengthen the connection between financial statements and other parts of a company’s reporting, such as sustainability disclosures.
The eight illustrative examples focus on areas such as materiality judgements, disclosures about assumptions and estimation uncertainties, and disaggregation of information. The principles and requirements illustrated in these examples apply equally to other types of uncertainties beyond climate-related uncertainties.
The deadline for submitting comment letters is 28 November 2024.
