Brian Allen Eli Seller Matt Conroy
Effectus Group comments on FASB’s Proposed Accounting Standards Update—Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40) Disaggregation of Income Statement Expenses
The comment period for the FASB’s proposed accounting standards update requiring disclosure of disaggregated income statement information recently closed and elicited a robust response with 73 comment letters from a wide spectrum of industry trade groups, individual companies, accounting firms, academic groups and others. In our comment letter, we share our perspective that we generally support the Board’s efforts to provide investors with more detailed and decision-useful information about the types of expenses within cost of sales, SG&A, research and development, and similar captions, that allow for a better understanding and assessment of companies’ performance. We observe in our comment letter though that the proposed Update, if adopted, will impose significant incremental costs on preparers and within our responses to the Board’s questions we recommend that the Board consider approaches to mitigate the burden.
For further perspective on the proposed accounting standard update, please contact Brian Allen at ballen@effectusgroup.com, Eli Seller at eseller@effectusgroup.com, or Matt Conroy at mconroy@effectusgroup.com.
