Benefits and timing of redesigning financial disclosures
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The most important thing financial statements should do, is to show whether a business is making money or not. Therefore, the clearer and more relevant they are, the more useful they become.
A redesigned set of financial statements reduces preparation time by eliminating low-value or boilerplate disclosures, shortens review cycles through improved clarity, and enhances user trust by focusing on the information stakeholders actually value. As an outcome, you get a more efficient finance team and build stronger communication with your investors and lenders.
So which companies should consider redesigning their disclosures and when should they do it? The strong candidates are the growing companies whose financial statements have evolved organically over time—often accumulating redundant or outdated notes and companies preparing for audits or major transactions.
Redesigning disclosures right away is ideal as finance teams get to harvest the benefits sooner. Realistically, doing this immediately might not be attainable so each company must assess its own situation so that the disclosure redesign is completed before busy season hits. Alternatively, companies can consider redesigning their disclosures upon first-time adoption of new accounting standards such as IFRS 18, the new P&D standard or IFRS 19, the reduced disclosure standard when they are eligible to do so.
Need help redesigning your financial disclosures? Contact VMC.
VMC's views are general insights—not one-size-fits-all advice. Every company's situation is unique.
