Debarment Penalty for Violating the Service Contract Act
Earlier this year, the Department of Labor (“DoL”) debarred a company and its owner/manager for three years for violations of the McNamara-O’Hara Service Contract Act (SCA) (41 U.S.C. Sec. 6701 et. seq.). Debarment is a severe punishment, so the Federal Acquisition Regulation (FAR) allows government contractors the opportunity to demonstrate why debarment is not necessary in certain situations. However, statutory debarments are a different matter. The SCA prescribes a three-year debarment for violations of the act unless there are unusual circumstances. This particular case (DoL Wage and Hour Division (“WHD”) vs. Garcia Forest Service, LLC & Samuel Garcia and Flor. Read More.
Write-Down Guidance to Stay in ASC 323-10-35-31
The Financial Accounting Standards Board (“FASB”) has opted to keep the guidance related to write-downs of equity method investments in Accounting Standards Codification (ASC) 323-10-35-31, Investments — Equity Method and Joint Ventures – Overall – Subsequent Measurement in lieu of making the previously proposed amendments to its upcoming Financial Instrument standard. In regard to the guidance, ASC 323-10-35-31 applies the concept of a decrease in value that is deemed “other than temporary” for writing down equity investments believed at their historical rate. Although the write-down guidance remains intact, the issue has been met with disapproval by FASB members. Thomas Linsmeier. Read More.
Auditing Standard on Related Parties Gains SEC Approval
Adopted by the Public Company Accounting Oversight Board (“PCAOB”) in June, the Securities and Exchange Commission recently approved PCAOB Auditing Standard (AS) No. 18, Related Parties, and its related amendments. Impacting financial statement audits for fiscal years starting on or after December 15, 2014, AS No. 18 features requirements for auditors concerning key areas of the audit related party transactions, significant unusual transactions, and relationships and transactions with its executive officers. AS No. 18 was adopted after the PCAOB determined the aforementioned transactions and relationships may increase the risk of misstatement in a company’s financial statement disclosures. In addition, the. Read More.
New Global Management Accounting Principles Released
To enhance business decision-making concerning data overload, scattered workforces and the rate of change, the American Institute of Certified Public Accountants (“AICPA”) and Chartered Institute of Management Accountants (“CIMA”) have published Global Management Accounting Principles . The framework explains how the Principles should be utilized in various practice areas, such as investment appraisal and cash management. Using feedback from their joint survey, the AICPA and CIMA’s Principles focus on: breaking down silos through effective communication; identifying the most important and dependable data for examination; pushing analysis that discloses the effect on organizational value; and encouraging integrity and trust that allows for long-term sustainability. Additional information regarding. Read More.
SSARS on Clarification and Recodification Released
Symbolizing the American Institute of Certified Public Accountants’ (“AICPA”) Accounting and Review Services Committee’s efforts to update its standards for practitioners, Statement on Standards for Accounting and Review Services (SSARS) No. 21, Statements on Standards for Accounting and Review Services: Clarification and Recodification, has been issued. Approved in August, SSARS No. 21 clarifies the service differences of accounting (preparation) and reporting (compilation or review). Impacting reviews, compilations and engagements for periods concluding on or after December 15, 2015, SSARS No. 21 features components such as Preparation of Financial Statements, Compilation Engagements and Review of Financial Statements. SSARS No. 21 also. Read More.
COSO to Update Enterprise Risk Management-Integrated Framework
Announced via press release on October 21st, the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) will begin a project to update its Enterprise Risk Management–Integrated Framework (the Framework). Published in 2004, the Framework has been used to increase a company’s ability to manage uncertainty and consider the amount of risk to accept when attempting to enhance its stakeholder value. With this project, COSO aims to improve the Framework’s content and significance so organizations can achieve higher value from enterprise risk management programs. The planned improvements are expected to create a more suitable application of enterprise risk management. In addition, the. Read More.