The International Accounting Standards Board (Board) issued in September 2017 new non-mandatory guidance to help companies make materiality judgements when preparing their financial statements. The guidance is called IFRS Practice Statement 2 Making Materiality Judgements.
In this video, Board Member Françoise Flores introduces the Practice Statement and explains:
- why the Board decided to develop it;
- how the concept of materiality helps companies determine what information to include in their financial statements;
- the consequences of not making sound materiality judgements on the quality of financial statements; and
- how the Practice Statement links to the Board's work under the theme of Better Communication in Financial Reporting.