PwC agrees with the proposed change to limit the disclosures to derivatives, repurchase agreements and reverse repurchase agreements, and securities borrowing and securities lending transactions that are either offset or subject to a master netting arrangement or similar agreement.
PwC encourages the Board to continue its outreach to investors and other stakeholders as it decides which alternatives to proceed with and develops them into a proposal. PwC generally supports the Board's effort to improve the relevance and comparability of financial reporting by developing a framework for setting disclosure requirements.
PwC generally believes that the draft framework identifies the appropriate matters to consider when determining whether a modification is appropriate. It identifies the significant differentiating factors that could support financial reporting differences between public and private companies.
PwC supports the proposal to provide information about the impact of reclassifications from accumulated other comprehensive income to net income in a single footnote. Most of the information to be disclosed is already included elsewhere in the financial statements. Consolidating it and providing a roadmap to the related disclosures will provide users with improved information without the operational challenges and costs that would have resulted from requiring separate presentation on the face of the income statement of the effects of the reclassifications on individual line items, particularly when such information is not readily available.
PwC suggests enhancements to the proposed guidance in the event that others believe it will be helpful to preparers and financial statement users and will improve consistency as to when and how to prepare financial statements using the liquidation basis of accounting.
PwC agrees that improved disclosures about liquidity and interest rate risks could provide a deeper understanding of an entity's risk profile. While the Firm encourages the Board to continue its outreach to analysts and preparers as it further develops the proposed disclosures, it offers a number of recommendations for the Board's consideration.