What They Mean When They Use Quantifiers – An Empirical Investigation of IASB’s Staff Analysis Paper on ED 9

Abstract

In order to assure transparency of the process of formation of a new International Financial Reporting Standard (IFRS), the International Accounting Standards Board (IASB) follows a strict due process. Part of this process is the analysis of comment letters sent to the IASB on the specific accounting problem under consideration. This analysis is prepared by IASB’s staff and informs the board of the IASB as well as the public on issues raised by the various interest groups. In the course of their analysis the staff uses verbal quantifiers in order to evaluate the amount of comment letters raising a certain issue or the frequency by which an issue has been raised. Unfortunately, these quantifiers are not officially defined. Against this background an analysis on the (numerical) meaning of these quantifiers is performed for the IASB’s Joint Venture project. It turns out that there is a certain ranking among the quantifiers, at least on an average basis. Besides this ranking, no further conclusions can be drawn from the quantifiers to the actual numbers underlying. In order to really be transparent in the due process, the paper therefore proposes to use actual numbers instead of verbal quantifiers within the analysis of comment letters or at least to explicitly define a numerical meaning of the quantifiers used.