What should be included in significant accounting policy disclosures in the notes?

• A. Market share of customers
• B. Selection criteria for policies
• C. Changes in policies
• D. Key sources of estimation uncertainty

Answer: (A)

Disclosures about significant accounting policies explain how the company chooses and applies its policy framework, and where estimation matters. The key items to include are: the criteria used to select among acceptable accounting policies, so readers understand why a particular policy was chosen; any changes in accounting policies during the period and the reasons for those changes, which helps with comparability and transparency; and the key sources of estimation uncertainty, since estimates underpin many to-be-recognized amounts and can materially affect results.

Market share of customers isn’t an accounting policy disclosure; it’s a business metric and doesn’t illuminate how policies are chosen, applied, or where estimates drive numbers. Including the criteria for policy selection, changes in policies, and estimation uncertainty ensures stakeholders can assess how policies influence reported figures.