Business, Legal & Accounting Glossary

Definition: Disclosure

Quick Summary of Disclosure

the action of making new or secret information known. The making known of a fact that had previously been hidden; a revelation. For example, in many US states, you must disclose major physical defects in a house you are selling, such as a leaky roof or potential flooding problem.

What is the dictionary definition of Disclosure?

Dictionary Definition

  1. The act of revealing something.
  2. legal The making known of a previously hidden fact or series of facts to another party; the act of disclosing.
  3. legal A previously hidden fact or series of facts that is made known.


  1. Accounting: Statutory or good faith revelation of a material fact (or an item of information that is not generally known) on a financial statement or in the accompanying notes (footnotes).
  2. Auditing: Compulsory reporting of all positive and negative information about the audited firm in an audit report. Its objective is to enable creditors and investors to draw an informed conclusion about the firm’s financial position.
  3. Banking: Statutory statement of complete information about a consumer or home mortgage loan. It is required to contain certain items of information such as:
    1. the actual interest rate,
    2. its computation,
    3. an itemised total of all charges and fees, and
    4. the minimum monthly payment.
  4. Insurance: Statutory revelation by the applicant (in the application for an insurance policy) of all known information about the risk to be covered.
  5. Litigation: See discovery.
  6. Securities issue: Statement of all known risk factors associated with a bond or stock investment, published as a disclosure document by the issuer of the security.

Full Definition of Disclosure

The Convention Of Disclosure means that all material facts must be disclosed in the financial statements. For example, in case of sundry debtors not only the total amount of sundry debtors should be disclosed, but also the amount of good and secured debtors, the amount of good, but amount of unsecured debtors and amount of doubtful debts should be stated. Full disclosure does not mean disclosure of each and every item of information. It only means disclosure of such information which is of significance to owners, investors & creditors.

Disclosure is the release of relevant information. Disclosure requirements play a major role in Generally Accepted Accounting Principles (GAAP), which dictate whether and where disclosure must be made on financial statements of business events. In investing, disclosure is commonly used in the term “full disclosure,” the requirement to release all information pertaining to a security or business transaction. A series of laws, beginning with the Securities Act of 1933 and continuing through the passage of Sarbanes-Oxley, has expanded full disclosure requirements for publicly traded companies, mutual funds, securities brokers, and others to a growing list of activities, including initial public offerings, proxy solicitations, and tender offers. The goal of full disclosure is to ensure transparency so all investors who participate in markets operate on a level playing field. Company management and boards of directors have strong incentives to seek full disclosure in public offerings. First, full disclosure of any potential problems tends to limit their legal liability should problems arise. Second, investors tend to discount the value of securities whose business they can’t understand or who they believe are hiding material information.

Synonyms For Disclosure

reporting, revelation, publication, exposure, disclose

Cite Term

To help you cite our definitions in your bibliography, here is the proper citation layout for the three major formatting styles, with all of the relevant information filled in.

Page URL
Modern Language Association (MLA):
Disclosure. PayrollHeaven.com. Payroll & Accounting Heaven Ltd. September 24, 2021 https://payrollheaven.com/define/disclosure/.
Chicago Manual of Style (CMS):
Disclosure. PayrollHeaven.com. Payroll & Accounting Heaven Ltd. https://payrollheaven.com/define/disclosure/ (accessed: September 24, 2021).
American Psychological Association (APA):
Disclosure. PayrollHeaven.com. Retrieved September 24, 2021, from PayrollHeaven.com website: https://payrollheaven.com/define/disclosure/

Definition Sources

Definitions for Disclosure are sourced/syndicated and enhanced from:

  • A Dictionary of Economics (Oxford Quick Reference)
  • Oxford Dictionary Of Accounting
  • Oxford Dictionary Of Business & Management

This glossary post was last updated: 22nd April, 2020 | 22 Views.