PCAOB Considering Revenue Recognition Interpretive Guidance for Auditors
Auditors could receive interpretive guidance on the Financial Accounting Standards Board’s (“FASB”) revenue recognition standard. Last month, Public Company Accounting Oversight Board (“PCAOB”) Chief Auditor Martin Baumann said a project is in the works to determine what type of guide the board should release concerning Accounting Standards Update (“ASU”) No. 2014-09, Revenue From Contracts With Customers (Topic 606). To help public companies implement ASU No. 2014-09, Baumann remarked that the PCAOB is considering releasing an Audit Practice Alert. The PCAOB staff has already reviewed Staff Audit Practice Alert (“APA”) No. 12, Matters Related to Auditing Revenue in an Audit of. Read More.
Topics: Accounting Standards Update "ASU", Audit Practice Alert, audits, FASB, FASB Accounting Standards Codification, Financial Accounting Standards Board "FASB", PCAOB, Public Company Accounting Oversight Board "PCAOB", Revenue from Contracts with Customers (Topic 606), Revenue Recognition, Staff Audit Practice Alert
Forthcoming Revenue Standard Proposal to Help Nonprofits
New Financial Accounting Standards Board (“FASB”) guidance could make it easier for nonprofits to record revenue from grants and donations with restrictions. On June 7, the FASB unanimously agreed on a proposal to help nonprofits differentiate between a condition and a restriction in U.S. GAAP for received grants and donations. Accounting Standards Update No. 2014-09, Revenue From Contracts With Customers (Topic 606) removed guidance on “exchange” transactions. Furthermore, many nonprofit organizations have had trouble distinguishing between a condition and restrictions. To address the matter, the FASB will clarify that when a gift comes with a donor-imposed condition, the agreement must. Read More.
Topics: Accounting Standards Update "ASU", Charitable Giving, FASB, Financial Accounting Standards Board "FASB", Nonprofits, Revenue from Contracts with Customers (Topic 606), Revenue Recognition, U.S. GAAP
Survey Reveals Slow Revenue Standard Implementation
Over 70 percent of 300 major public businesses in the U.S. have yet to upgrade their accounting systems in preparation for the Financial Accounting Standards Board’s revenue recognition standard. In a survey conducted by one of the Big Four firms, one-third of respondents said their company are facing implementation challenges and could fall behind schedule. Reasons companies reported for falling behind implementation efforts include insufficient funding or staff, problems interpreting the revenue standard’s technical requirements, and issues collecting data. Public companies have six months to comply with Accounting Standards Update No. 2014-09, Revenue From Contracts With Customers. Survey officials believe. Read More.
FASB Approves Hedge Accounting Standard
The Financial Accounting Standards Board (“FASB”) will move forward with a new accounting standard to simplify hedge accounting guidance. Voted on last Wednesday, the standard will refine and expand hedge accounting for financial and commodity risks. In addition, the standard will help investors and analysts by improving transparency to the presentation of economic results in financial statements. Speaking on the new guidance, FASB Chairman Russell Golden said the standard will enhance the alignment of accounting rules with an entity’s risk management activities and simplify hedge accounting. The final Accounting Standards Update is scheduled for an August release. For public companies,. Read More.
FASB Clarifies the Customer in Service Concession Arrangements
The Financial Accounting Standards Board (“FASB”) is providing relief to companies confused about who is the customer in a service concession arrangement. Issued as Accounting Standards Update No. 2017-10, Service Concession Arrangements (Topic 853): Determining the Customer of the Operation Services, the new guidance states that the grantor is the customer in service concession arrangements. Public companies, in addition to nonprofits that have issued, or are a conduit bond obligor for, securities traded, listed, or quoted on an exchange or an over-the-counter market and an employee benefit plan that submits financial statements to the Securities and Exchange Commission, must apply. Read More.
Topics: Accounting Standards Update "ASU", FASB, Financial Accounting Standards Board "FASB", Revenue from Contracts with Customers (Topic 606), Securities and Exchange Commission "SEC", Service Concession Arrangements (Topic 853)
Decisions Reached on Distinguishing Liabilities from Equity Project
At its May 10 meeting, the Financial Accounting Standards Board (“FASB”) reached the following decisions on its proposed Accounting Standards Update, Distinguishing Liabilities from Equity (Topic 480): I. Accounting for Certain Financial Instruments with Down Round Features, and II. Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception: Display (Earnings Per Share). Impacting companies within the scope of Topic 260, Earnings Per Share, an earnings per share (“EPS”) numerator modification will be required to income offered to common shareholders in basic EPS for equity-classified freestanding financial instruments. Additionally,. Read More.
Topics: Accounting Standards Update "ASU", Distinguishing Liabilities (Topic 480), Earnings Per Share (Topic 260), Equity (Topic 505), FASB, Financial Accounting Standards Board "FASB", liabilities and equity