As the Financial Accounting Foundation thinks about a proposed tactical strategy, ABA is suggesting the company think about making sure that post-implementation evaluations (PIRs) are performed regularly which FAF takes a management function in assisting bridge the space in between financier expectations and reporting on ecological sustainability.
FAF offers oversight of the Financial Accounting Standards Board and the Governmental Accounting Standards Board. The company sent a draft tactical strategy for public remark in May, with the file spelling out FAF’s overarching objectives. ABA sent remarks the other day stating it supported the basic instructions of the draft strategy however had 2 suggestions.
First, FASB ought to perform routine PIRs of essential accounting requirements and upgrade the evaluations throughout a financial cycle, based upon coexisting financier requirements. As examples, ABA kept in mind that PIRs performed on the CECL requirement and reasonable worth requirement might generate various results based upon the financial conditions throughout which the evaluations occurred. Second, FAF ought to engage with stakeholders, regulators and Congress to bridge the space in between monetary accounting expectations and procedures and sustainability reporting.
“We are not advocating at this time that FASB (or a new board overseen by FAF) necessarily needs to issue sustainability reporting standards,” ABA stated in its remarks. “However, we believe the nascent state of sustainability reporting requires FAF to take a leadership role in helping stakeholders to bridge the gap of investor expectations between long-held financial reporting concepts and sustainability reporting.”