Concepts Omnibus

FASAB Contact, Robin Gilliam, gilliamr@fasab.gov, 202-512-7356

Request for CommentDue DateOnline Link
to questions for
Respondents		Comment LettersFinal Pronouncements
Omnibus Concepts Amendments (PDF)November 27, 2023Survey LinkComment LettersN/A – Currently Under Due Process

Project Objective

The objective of the concepts omnibus project is to amend existing concepts for note disclosures and management’s discussion and analysis (MD&A). Amending note disclosure concepts in paragraph 68 of Statement of Federal Financial Accounting concepts (SFFAC) 2, Entity and Display, will expand concepts to include the fundamental types of useful information that may be presented in note disclosures and the role of note disclosures as an integral part of the basic financial statements. Amending MD&A concepts in paragraph 69 of SFFAC 2 will consolidate MD&A concepts into one SFFAC.

Click here for a history of the MD&A project.

Click here for a history of the note disclosures project.

HISTORY OF BOARD DELIBERATIONS (reverse chronology)

August 25, 2023

On August 25, 2023, FASAB released for public comment a proposed Statement of Federal Financial Accounting Concepts titled Omnibus Concepts Amendments. Comments on the ED are due by November 27, 2023.

This proposal would identify a set of principles for the Board to use to reduce repetition and improve relevance, clarity, comparability, and consistency of note disclosures. This proposal would also consolidate guidance for the Board on developing management’s discussion and analysis (MD&A) standards by rescinding SFFAC 3, Management’s Discussion and Analysis, and amending paragraph 69 of SFFAC 2, Entity and Display.

July 2023

At the April 2023 meeting, the members agreed to a couple of minor revisions to the Omnibus Concepts Amendments draft exposure draft (ED). The Board had last reviewed the draft at the December 2021 meeting and agreed to the proposed amendments to note disclosures and MD&A concepts in SFFAC 2, paragraphs 68 and 69, respectfully. After extensive MD&A deliberations (February 2022 to February 2023), the Board merged the standards-like content from SFFAC 3 into the proposed MD&A standards. Therefore, the Board agreed to rescind SFFAC 3 in its entirety in the Omnibus Concepts Amendments because the proposed amendments to SFFAC 2 paragraph 69 now reflect the concepts necessary to support development of principles-based MD&A standards.

The Omnibus Concepts Amendments draft exposure draft will be balloted once the MD&A draft exposure draft is also ready to be balloted.

April 18-19, 2023

At the April 2023 meeting, members agreed on final technical edits in preparation for a pre-ballot as follows:

Questions for Respondents

Members agreed to include an excerpt from the Handbook chapter Preamble to Statements of Federal Financial Accounting Concepts to introduce what concepts do. The Board also agreed to remove some language from each question.

Note Disclosures Concepts

Paragraph 68.A – Members agreed that note disclosure concepts should reference disaggregation of an item and not aggregation of an item.

MD&A Basis for Conclusions

Members agreed with restructuring the basis for conclusions for the MD&A concepts to synchronize the text with the basis for conclusions for the MD&A standards.

Paragraph A7 – Members changed “Practice shows that agencies ‘have focused’” to “‘relied primarily’ on SFFAS 15 when preparing MD&As.”

Briefing materials – Topic C.2

April 2022

The Board last reviewed the draft Omnibus Concepts Amendments exposure draft (ED) at the December 2021 meeting. The draft ED proposes to amend the note disclosure and MD&A concepts in paragraphs 68 and 69 in SFFAC 2 and rescind SFFAC 3 in its entirety. Several member suggested edits were incorporated into the draft based on the December meeting discussion.

The Omnibus Concepts proposal has been drafted in conjunction with the Management’s Discussion & Analysis proposal; therefore, the Board agreed to expose both proposals together. Staff will present an Omnibus Concepts pre-ballot draft ED to the Board to review once the MD&A standards draft ED is also ready for pre-balloting.

December 14, 2021

During the December meeting, the Board reviewed the draft Omnibus Concepts Amendments exposure draft (ED), which proposes to amend the note disclosure and MD&A concepts in paragraphs 68 and 69 in SFFAC 2 and rescind SFFAC 3 in its entirety.

The members provided several suggested edits to the draft ED:

  • Consider incorporating the proposed guidance in paragraph 68D of the note disclosures concepts into the proposed MD&A concepts
  • Ensure that the context of the RSI is included in the proposed amendments to SFFAC 2, paragraph 69
  • Review paragraphs 7A and 7B for consistency with the changes to the summary
  • Review the document for consistency throughout the sections

Staff also noted that they were concurrently drafting an ED for MD&A standards. Once the Board approves the updated draft Omnibus Concepts Amendments ED, staff plans to expose both proposals together.

Staff noted that the plan is to bring a pre-ballot draft ED to the Board to review once the MD&A standards draft ED is also ready for pre-balloting. The members agreed with staff’s plan.

Briefing materials – Topic C

October 2021

The objective of the concepts omnibus project is to amend existing concepts for note disclosures and management’s discussion and analysis (MD&A). Amending note disclosure concepts in paragraph 68 of Statement of Federal Financial Accounting Concepts (SFFAC) 2, Entity and Display, will expand concepts to include the fundamental types of useful information that may be presented in note disclosures and the role of note disclosures as an integral part of the basic financial statements. Amending MD&A concepts in paragraph 69 of SFFAC 2 will consolidate MD&A concepts into one SFFAC.

Staff has developed a concepts omnibus draft exposure draft to include amendments to note disclosures and MD&A concepts in SFFAC 2. Staff presented the draft exposure draft at the June 2021 meeting. Some members wanted to progress further on the MD&A standards project before exposing the MD&A concept amendments. It should be noted that “concepts statements are intended to set forth objectives and fundamentals on which financial accounting and reporting standards will be based.” Therefore, the MD&A concepts should be established before the standards are finalized. Staff plans to bring the concepts omnibus draft exposure draft back to the Board for deliberations at the December 2021 meeting.

June 22-23, 2021

The Board reviewed a draft combined concepts statement exposure draft that included amendments to SFFAC 2 for both note disclosure and MD&A concepts.

The Board made the following revisions to the section titled How Would This Proposal Improve Federal Financial Reporting and Contribute to Meeting the Federal Financial Reporting Objectives?

  • The Board agreed to the following updated first paragraph, second sentence:
    Note disclosures are necessary to enhance understandability of the financial statement for users and to provide insight into the complexity and amount of information reported.
  • The Board agreed to the following updated second paragraph, first sentence:
    Users rely on MD&A to communicate management’s insights about the reporting entity’s financial position and condition to increase the understandability and usefulness of the agency financial report.

The Board agreed to the two proposed questions in the Questions for Respondents section.

The Board made the following revisions to the Scope section.

  • The Board agreed to merge the first and second paragraphs for the following updated scope paragraphs about note disclosures concepts:
    This Statement updates concepts related to the role of note disclosures as an integral part of the basic financial statements and the fundamental types of useful information that may be presented. The Board may use these concepts to help to identify efficient and effective ways information supporting the fair presentation of amounts in the financial statements can be disclosed.
  • The Board agreed to the following scope paragraph about MD&A concepts:
    This Statement consolidates the Board’s concepts for MD&A by rescinding SFFAC 3 and updating SFFAC 2, paragraph 69 to provide a conceptual overview of information that may be included in MD&A.
  • The Board agreed to add “quantitative and qualitative” to paragraph 5.D:
    Financial and non-financial related information to demonstrate accountability—Note disclosures may also provide quantitative and qualitative information that demonstrates an entity’s accountability to its citizens, including information that may be helpful in assessing the results of management’s decision-making on the entity.

The Board tentatively agreed to the following for MD&A concepts:

  • Paragraph 6 will rescind SFFAC 3.
  • Paragraph 8.A
    RSI includes management’s discussion and analysis (MD&A) of the reporting entity. MD&A is an important vehicle to communicate management’s insights about the reporting entity, including the reliability of information reported to increase the understandability and usefulness of the agency financial report.
  • Paragraph 8.B
    MD&A summarizes information about the financial position, financial condition, and performance of the reporting entity by discussing the entity’s mission, organization, and key financial and performance information.

Briefing materials – Topic A