Accounting Plan Highlights How Businesses Spend Their Money

Public companies would be forced to reveal key details about expenses like worker pay and raw materials under a proposal released Monday by US accounting standard-setters.

The Financial Accounting Standards Board’s proposed disclosures aim to help investors and analysts better understand how companies spend and earn their money. It’s a response to years of investor complaints that corporate financial statements lump expenses into catch-all categories like “selling, general, and administrative,” with scant details about the biggest costs in these buckets.

The details could offer “critically important” information so investors can better understand a company’s ...