Common themes
We set out to analyse the common themes emerging from legislation and guidance around narrative reporting. Our analysis focuses on one paper, The International Accounting Standards Board (IASB) Management Commentary discussion paper, which is based on a review of guidance and requirements across several jurisdictions. In its analysis of existing principles and requirements relating to narrative reporting, the paper noted many 'common threads'. These emerged particularly strongly in three areas:
Key audience >
Principles and qualitative characteristics >
Frameworks >
These three shared elements provided a sound basis for progress in this area, removing the need to start again from first principles.
The project team focused its review on the guidance in place in the following countries:
- Canada - new updated guidance in May 2004
- Germany - new legislation in December 2004
- UK - new legislation in early 2005 and replaced by guidance in January 2006
- US - new guidance on the MD&A issued by the SEC in December 2003
- The Technical Committee of the International Organization of Securities Commissions (IOSCO) guidance on MD&A issued in February 2003
The project team also reviewed guidance issued in Australia (including a new mandatory directors' report introduced from July 2004) and the EU Modernisation Directive, which, to a degree, drove the recent developments in Germany and the UK.
