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Chapter 17
Management commentary
2.1 What is management commentary?
Management commentary provides users with context through which to interpret the
financial position, financial performance and cash flows of an entity.
It is not mandatory for entities to publish a management commentary. However, the
International Accounting Standards Board has produced a Practice Statement that
provides guidance when producing management commentary.
2.2 Elements of management commentary
Management commentary should include information that is essential to an
understanding of:
the nature of the business
management’s objectives and its strategies for meeting those objectives
the entity’s resources, risks and relationships
the results of operations and prospects, and
the key performance measures that management use to evaluate the entity’s
performance.
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