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The International Accounting Standards Board (IASB) is developing potential ways to improve the requirements of IAS 7 Statement of Cash Flows including:

  1. the disaggregation of cash flow information;
  2. the reporting of information about non-cash transactions;
  3. the transparency of information communicated about cash flow measures not specified in IFRS Accounting Standards;
  4. the consistent application of requirements to classify cash flows as operating, investing or financing; and
  5. the consistent application of the definition of ‘cash equivalents.’

The IASB will also consider how any improvements might apply to the statement of cash flows for financial institutions.

IASB® Update May 2026

The IASB met on 19 May 2026 to discuss:

  • improving disaggregation of cash flow information by strengthening its link with other information; and
  • improving disclosure of changes in liabilities arising from financing activities.

Improving disaggregation of cash flow information by strengthening the link with other information (Agenda Paper 20A)

The IASB tentatively decided to propose adding:

  1. application guidance on aggregating and disaggregating line items in the statement of cash flows that requires an entity:
    1. to use, as the basis for disaggregating line items in the statement of cash flows, the disaggregation of related line items of assets or liabilities presented in the statement of financial position; and
    2. to disclose how the disaggregation of line items in the statement of cash flows differs from the disaggregation of related line items in the statement of financial position, if applicable;
  2. application guidance on labelling and describing line items that requires an entity to use similar labels for items with similar characteristics and different labels for items with different characteristics; and
  3. application guidance specifying that if the information in a note relates to more than one primary financial statement, an entity would be required to cross-refer to that note in each related primary financial statement. 

All 13 IASB members agreed with this decision.

Changes in liabilities arising from financing activities (Agenda Paper 20B)

The IASB tentatively decided to propose clarifying the disclosure objective in paragraph 44A of IAS 7 Statement of Cash Flows. The clarified objective would refer to the ability of users of financial statements to link information disclosed about changes in liabilities arising from financing activities to the statement of financial position and the statement of cash flows.

All 13 IASB members agreed with this decision.

The IASB also tentatively decided:

  1. to propose requiring an entity to satisfy the disclosure objective by:
    1. providing the information about changes in these liabilities using a reconciliation between the opening and closing balances in the statement of financial position; and
    2. disaggregating the opening and closing balances in (i) on the basis of the line items of those liabilities in the statement of financial position and the items of those liabilities disclosed in the notes; and
  2. not to propose requiring an entity that discloses changes in liabilities arising from financing activities to disclose information about changes in additional assets and liabilities (for example, cash and cash equivalents).

Twelve of 13 IASB members agreed with this decision.

The IASB also discussed its previous tentative decision not to define the measure ‘net debt’, taking into account its more recent decisions.

The IASB tentatively decided, in line with its previous decision, not to explore developing additional requirements for an entity to disclose information about its net debt.

Eight of 13 IASB members agreed with this decision.

Next milestone

Exposure Draft