On November 28, the IIF submitted industry perspectives in response to the International Accounting Standards Board (IASB) Exposure Draft (ED) on Climate-related and Other Uncertainties in the Financial Statements. The ED proposes eight examples illustrating how an entity applies the requirements in IFRS Accounting Standards to report the effects of climate-related and other uncertainties in its financial statements.

In the letter, The IIF welcomed the objective of the IASB to help to improve the reporting of the effects of climate-related and other uncertainties in financial statements. Stakeholder feedback to the IASB suggests there are strong expectations and need for additional information on these matters, but we caution against the IASB making financial statements the home of all this additional information while requirements and application in the sustainability-related space is still being developed.

We provided feedback regarding the additional disclosure requirements proposed in the Exposure Draft (ED) and provided a number of recommendations, including on the following topics:

• Concerns about the sufficiency of information on immaterial climate-related information should not be addressed by additional disclosure in the financial statements.
• We are concerned about a reliance on a materiality catch-all where some of the examples pertain to events that have no impact on an entity’s financial position or performance results in disclosure of information that is immaterial within the context of the financial statements.
• When it comes to the disclosure of climate-related impacts to credit risk we would suggest that our members help the IASB develop practices and reporting that responds to these demands, especially examples where we expect there to be disclosure.
• The Illustrative Examples would benefit from being positioned as educational materials.