No. of Points


Category 1: The nature of the business

Point 1

(a) the industries in which the entity operates;

(b) the entity’s main markets and competitive position within those markets;

(c) significant features of the legal, regulatory and macro-economic environments that influence the entity and the markets in which the entity operates;

Point 2, Point 3

(d) the entity’s main products, services, business processes and distribution methods;

Point 4

(e) the entity’s structure and how it creates value.

Category 2: Objective and strategy

Point 5 , Point 7

Management should disclose its objectives and strategies in a way that enables users of the financial reports to understand the priorities for action as well as to identify the resources that must be managed to deliver results. For example, information about how management intends to address market trends and the threats and opportunities those market trends represent provides users of the financial reports with insight that may shape their expectations about the entity’s future performance.

Point 6

Management should also explain how success will be measured and over what period of time it should be assessed.

Point 8

Management should discuss significant changes in an entity’s objectives and strategies from the previous period or periods.

Point 9, Point 10

Discussion of the relationship between objectives, strategy, management actions and executive remuneration is also helpful.

Category 3: Key resources, risks and relationships


Point 11, Point 12

Management commentary should set out the critical financial and non-financial resources available to the entity and how those resources are used in meeting management’s stated objectives for the entity. Disclosure about resources depends on the nature of the entity and on the industries in which the entity operates.

Point 13 to Point 17

Analysis of the adequacy of the entity’s capital structure, financial arrangements (whether or not recognized in the statement of financial position), liquidity and cash flows, and human and intellectual capital resources, as well as plans to address any surplus resources or identified and expected inadequacies, are examples of disclosures that can provide useful information.


Point 18

Management should disclose an entity’s principal risk exposures and changes in those risks, together with its plans and strategies for bearing or mitigating those risks, as well as disclosure of the effectiveness of its risk management strategies. This disclosure helps users to evaluate the entity’s risks as well as its expected outcomes. Management should distinguish the principal risks and uncertainties facing the entity, rather than listing all possible risks and uncertainties.

Point 19

Management should disclose its principal strategic, commercial, operational and financial risks, which are those that may significantly affect the entity’s strategies and progress of the entity’s value. The description of the principal risks facing the entity should cover both exposures to negative consequences and potential opportunities.

Point 20

Management commentary provides useful information when it discusses the principal risks and uncertainties necessary to understand management’s objectives and strategies for the entity. The principal risks and uncertainties can constitute either a significant external or internal risk to the entity.


Point 21

Management should identify the significant relationships that the entity has with stakeholders, how those relationships are likely to affect the performance and value of the entity, and how those relationships are managed.

Point 22

This type of disclosure helps users of the financial reports to understand how an entity’s relationships influence the nature of its business and whether an entity’s relationships expose the business to substantial risk.

Category 4: Results and prospects