News Article - 23 February 2007
Category:

The International Accounting Standards Board (IASB) has published its plans to amend requirements which state that entities must disclose in their financial statements details of related parties.

Now available for public comment, the plans outline changes to international accounting standard (IAS) 24 Related Party Disclosures.

According to the IASB, the main change proposed is to reduce the requirements in IAS 24 for certain bodies which are related because they are controlled or influenced by the state.

"The proposals aim to remove a significant burden of disclosure from some entities, particularly in jurisdictions with extensive state control of, and significant influence over, businesses," said Sir David Tweedie, IASB chairman.

For those entities which fall into the category of being state-controlled, the cost of complying with the standard may outweigh the benefits posed to users of their financial statements, the board suggested.

Comments are being invited on the exposure draft until May 25th 2007, with the changes also being issued in response to requests asking for a clearer definition of a related party.

The main objective of IAS 24 is to ensure that statements contain disclosures needed for highlighting the possibility hat the entity's financial stance may have been affected by related parties.

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