The concept of adequate disclosure continues to be one of the most important issues facing accountants, and disclosure may take various forms.
Discuss the various forms of disclosure available in published financial statements.
The classic forms for disclosure are (1) on the face of the financial statements, (2) in the footnotes to the financial statements and (3) in managements' voluntary discussions, typically called Operating and Financial Review (OFR) or Management's Discussion and Analysis (MD&A). The disclosures on the face of the financial statements tend to be mostly required disclosures. The footnotes would have a blend of required and voluntary disclosures and management's discussion would be primarily voluntary comments.
The face of the financial statements may contain details about components in inventory (raw materials, work in process) and classifications of major long term assets ...
The three forms of disclosure are discussed in everyday language suitable for a novice (403 words).