The guide can help individuals with this process and, thus, help improve the quality of reporting. It is also designed to fit within the context provided by applicable accounting standards. It targets significant judgments across narrative and financial reporting, including accounting treatment, materiality, and disclosures. ![]() The framework identifies core principles and provides a structured process to guide decision makers through how to make, assess, and document significant judgments. I believe that this professional judgment framework is vital for the future of the profession,” said Sir David Tweedie, former Chair of the International Accounting Standards Board and former ICAS President. “Confidence in financial reporting and in principles-based standards requires us to demonstrate collectively that, as professionals, we are capable of making sound judgments. The guide includes a framework for audit committee members and further material on ethical decision making as well as recommendations for standard setters to ensure that standards provide the scope for professional judgment. It also provides a useful training guide for students or those new to decision making who wish to share the experience of those who have been there and done it before. Irrespective of whether you are an auditor, preparer, audit committee member, or regulator, this practical guide provides a structure that aims to help you come to a sound judgment when you have a complex financial or narrative reporting decision to make. ![]() The result is a new publication, A Professional Judgment Framework for Financial Reporting Decision Making, which offers practical guidance for decision makers involved in narrative and financial reporting. With this in mind, a group of senior Chartered Accountants, including finance directors, audit partners, audit committee chairs, regulators, and standard setters, have shared their experience to distil the key principles they use for making a sound judgment. The success of narrative and financial reporting relies on our ability to be able to make sound judgments and demonstrate our reasoning for these judgments. Making a judgment in a complex world, with principles-based accounting standards, is not an easy task.
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