The International Accounting Standards Board is considering changes to its rules that would require companies to disclose more information about how their acquisitions have performed.

In a discussion paper released on Thursday, the IASB said investors want more information on whether takeovers live up to expectations and believe current disclosures required under IFRS rules — such as the annual test for goodwill impairment — are not sufficient.

The board’s preliminary view is that the requirement to disclose the primary reasons for an acquisition should be replaced with a requirement to disclose the strategic rationale for undertaking an acquisition and management’s objectives for the acquisition at the acquisition date.

Additionally, the information a company discloses about an acquisition’s subsequent performance “should reflect the information and metrics the company’s management uses to monitor and measure the acquisition’s progress against the objectives of the acquisition.”

“Investors want better information about how acquisitions are performing to help them hold a company’s management to account,” IASB Chair Hans Hoogervorst said in a news release. “Our suggested solution aims to meet investors’ needs without being too costly for companies.”

The IASB sets accounting rules that are mandatory in more than 140 countries. According to the discussion paper, investors have said companies typically do not provide enough information to help them assess whether management’s objectives for an acquisition are being met — for example, whether the synergies management expect from an acquisition are being realized.

The board said it considered improving the impairment test by requiring a company to report at an earlier date if its goodwill had lost value, but concluded “there is no alternative that can target goodwill better and at reasonable cost.”

There is also “no clear evidence that amortizing goodwill would significantly improve the information that companies report to investors,” the IASB said.

Stakeholders have until Sept. 15 to comment on the discussion paper. The focus “is very much on a set of disclosures to help investors really understand acquisitions and whether they have gone well or not,” IASB Vice Chair Sue Lloyd told Reuters.

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