DRSC comments on the IASB’s Exposure Draft ED/2024/6 Climate-related and Other Uncertainites in the Financial Statements – Proposed illustrative examples

On November 15, 2024, the DRSC’s Financial Reporting Technical Committee (FR TC) published its response to the IASB’s Exposure Draft Climate-related and Other Uncertainties in the Financial Statements – Proposed illustrative examples (ED/2024/6).

In this draft, the IASB proposes eight examples for illustrating disclosures on these uncertainties. The comment period for this ED ends on 28 November 2024.

The FR TC welcomes the IASB’s proposals and the objective of the project to close information gaps on climate-related and other uncertainties. The FR TC generally supports the focus of the project and its narrow scope, according to which, for example, changes to the definitions of liabilities or other adjustments to the Conceptual Framework are excluded. Nevertheless, the FR TC believes that adjustments to the IFRS in addition to the proposed non-binding examples will further contribute to the overall objective of the project. In addition, the FR TC considers it necessary to revise the examples in order to clarify the intended statements and to ensure their practical relevance.

Furthermore, the FR TC responded in a comment letter to EFRAG’s respective draft comment letter to the IASB. The FR TC agrees with the key points that EFRAG raises in its draft comment letter. However, the FR TC is sceptical with regard to a few aspects in the draft comment letter, such as the need to develop a sustainability framework.