This chapter introduces the general concepts of financial statement presentation and disclosure that underlie the detailed guidance that is covered in the remaining chapters of this guide.
ASC 205, Presentation of Financial Statements, provides the baseline authoritative guidance for presentation of financial statements for all US GAAP reporting entities. ASC 205-10-45-1A lists the required financial statements under US GAAP.
The presentation rules in ASC 205 closely align with SEC regulations, except for certain circumstances in which the SEC may prescribe incremental requirements.
The presentation and disclosure requirements discussed in this guide presume that the related accounting topics are considered to be material and applicable to the reporting entity. That assumption applies throughout the guide and will not be restated in every instance. Accounting topics or transactions that are not material or not applicable to a reporting entity generally do not require separate presentation or disclosure, unless otherwise indicated.
This guide details the required presentation and disclosures for each topical area. In addition, S-X 4-01 requires that financial statements not be misleading. As a result, reporting entities may need to supplement required disclosures with additional information to provide context or further clarification that they believe would be meaningful to users.
Comparative financial statements provide historical context for a reporting entity's financial performance and enable users to identify trends or other relationships. Comparative periods should be presented on a consistent basis with any changes disclosed as a change in accounting policy or correction of an error (see FSP 30).
Figure FSP 1-1 depicts the reporting periods required by the SEC for financial statements of public companies.