What Is the Way Forward for IASB’s Research Programme under the Evidence-Supported Approach? Some Analyses and Comments Based on the 2015 Agenda Consultation

Abstract

The purpose of this paper is twofold: (1) the paper reviews the International Accounting Standards Board (IASB's) evidence-supported approach to standard setting, in particular the very broad definition of evidence that does not distinguish between scientific evidence used for developing the normative foundation (the standards) and observations in practice. Based on comparisons with medicine and auditing, we argue that there are good reasons for the IASB to separate scientific evidence from other sources of information. As producers of scientific evidence, the academic community must consider whether better alignment between publishing incentives and standard setting can be achieved. (2) Examining the 2015 Agenda Consultation, the ‘top-five’ research projects were identified: ‘Disclosure Initiative – Principles of Disclosure’, ‘Primary Financial Statements’, ‘Financial Instruments with Characteristics of Equity’, ‘Business Combinations under Common Control’, and ‘Goodwill and Impairment’. In order to further support evidence-informed standard setting, we provide research-based comments on these projects (based on the European Accounting Association's Agenda Consultation comment letter).

Keywords:

• standard setting
• research programme
• evidence
• IFRS
• agenda consultation

Disclosure Statement

No potential conflict of interest was reported by the authors.

Notes

1 Similar to the US model under SEC final rule no. 33-817, Conditions for use of non-GAAP financial measures.

2 https://www.putnam.com/literature/pdf/II853.pdf

3 The objective of the EFRAG (2014) paper is to review, based on prior literature, what are the arguments underlying the debate on impairment versus amortisation and goodwill and also what is the empirical evidence supporting arguments favourable or not to the different options.