Appendix B — Comparison of U.S. GAAP and IFRS Accounting Standards

B.3 Disclosures

As indicated above, the measurement guidance in ASC 820 is largely converged with that in IFRS 13. However, there are differences between the disclosure requirements in ASC 820 and those in IFRS 13, largely because of the guidance in ASU 2018-13. (Very few of these differences existed before ASU 2018-13.) ASU 2018-13 updated several aspects of the U.S. GAAP fair value disclosure requirements; however, the same updates were not made to IFRS Accounting Standards. The Background Information and Basis for Conclusions of ASU 2018-13 provides the rationale for the divergence between the two sets of standards. Paragraph BC78 of ASU 2018-13 states:

The amendments in this Update relate to disclosures only and remove disclosures that are no longer considered cost beneficial, clarify the specific requirements of disclosures, and add disclosure requirements identified as broadly relevant. The amendments create differences in disclosures based on the FASB’s and the IASB’s differing assessments on financial statement users’ needs and the application of the concepts in the Concepts Statement to the disclosures required by Topic 820.

Therefore, because the disclosure requirements under IFRS 13 and other IFRS Accounting Standards differ from those under U.S. GAAP, entities reporting under IFRS Accounting Standards should carefully consider these disclosure requirements as part of their annual and interim reporting.

One notable difference between the disclosure requirements under U.S. GAAP and those under IFRS Accounting Standards is that IFRS Accounting Standards require that entities provide a quantitative sensitivity analysis for recurring fair value measurements of financial instruments classified in Level 3 of the fair value hierarchy. ASU 2018-13 only requires entities that are not nonpublic entities to provide a narrative description of the uncertainty of a Level 3 fair value measurement that results from the use of unobservable inputs if those inputs reasonably could have been different as of the reporting date.

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This publication provides comprehensive guidance; however, it does not address all possible fact patterns, and the guidance is subject to change. Consult a Deloitte & Touche LLP professional regarding your specific issues and questions.