Accounting Rules Readied for Detailed ‘Hidden Debt’ Disclosure

Companies would have to reveal the existence of and details about common financing techniques they use that flatter their cash flows but stay out of sight of investors and analysts.

The Financial Accounting Standards Board on Monday issued a proposal calling on companies that use supply chain financing to reveal the key terms of the increasingly popular arrangements. The three-way payment programs allow companies to spread out their bills to suppliers through arrangements with banks and financial institutions. Many companies use this financing, but most don’t say if they do. One credit rating agency refers to supply chain financing as ...