TEI Questions the Utility of Proposed Updates to ASC 740

On December 12, 2016, TEI submitted a comment letter to the Financial Accounting Standards Board concerning proposed changes to the disclosure requirements in ASC 740 (accounting for income taxes).  TEI commended the FASB’s efforts to update this complex accounting standard, but also expressed its view that required tax disclosures are becoming confusingly detailed, subjective, and duplicative.  TEI urged the FASB to reconsider whether the proposed updates truly achieve the FASB’s overarching cost-benefit and decision-usefulness objectives or simply add low value detail and confusion to tax footnotes at a high cost to preparers. 

The comments were prepared by TEI’s Financial Reporting Committee whose chair is Eric Johnson.

Download the submission.