The Board discussed the conclusions reached by the project team that developed the discussion paper Management Commentary, published in 2005. The Board considered those conclusions in the context of the Board�s proposals for phase A of the Conceptual Framework (see the exposure draft An improved Conceptual Framework for Financial Reporting: Chapter 1 The Objective of Financial Reporting and Chapter 2 Qualitative Characteristics and Constraints of Decision-useful Financial Reporting Information).
The Board tentatively decided that:
- work on the management commentary project will be based on the �in process� work for phase A of the Conceptual Framework project; and
- the management commentary framework is subordinate to the Conceptual Framework. Consequently, the objective, users and qualitative characteristics of management commentary will mirror those described in the Phase A exposure draft.
The Board considered the types of information to be included in management commentary. In the discussion paper, a proposal was made to identify key elements that reflect the type of content the Board expects to see in management commentary rather than defining the elements themselves. At this meeting, the Board decided tentatively to require the following specific content elements beyond those described in the discussion paper:
- the strategy used for evaluating management (including executive remuneration)
- the strategy used for minimising taxes and how that strategy integrates with the entity�s uncertain tax position
- a discussion of key resources, including unrecognised intangible assets
- a discussion of financing obligations.
Additionally, the Board tentatively decided to develop presentation requirements for management commentary that link to IFRS 8 Segment Reporting.
The Board instructed the staff to begin drafting an exposure draft of a proposed guidance statement: this is tentatively scheduled for publication in the fourth quarter of 2008.