Nonprofits Receive Updated Consolidation Reporting Guidance
Helping nonprofits with consolidated reporting disclosures, the Financial Accounting Standards Board (“FASB”) recently issued Accounting Standards Update (“ASU”) No. 2017-02, Not-for-Profit Entities—Consolidation (Subtopic 958-810): Clarifying When a Not-for-Profit Entity That Is a General Partner or a Limited Partner Should Consolidate a For-Profit Limited Partnership or Similar Entity. ASU No. 2017-02 clarifies when nonprofits that are general partners should consolidate their holdings in a for-profit limited partnership. The ASU will move the current content from Subtopic 810-20, Consolidation—Control of Partnerships and Similar Entities, that was deleted in ASU 2015-02 and move it to Subtopic 958-810 for nonprofits. The FASB says the. Read More.
FASB Lease Standard Meets its First Test
Defining what qualifies as a lease could be the first obstacle for the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Update No. 2016-02, Leases (Topic 842). During a discussion at the AICPA Conference on Current SEC and PCAOB Developments last month, panelists debated how varying arrangements are disclosed under the updated lease definition. One Big Four firm partner said some lease arrangements aren’t clearly stated, making it difficult for those receiving or providing a service. Xcel Energy’s Richard Briggs also seeks clarity in the lease definition, saying his company will have to determine whether some arrangements with farmers to install. Read More.
Restricted Cash Amendments Approved
Accounting Standards Update (“ASU”) No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash, has been issued by the Financial Accounting Standards Board. The new amendments cover diversity in practice when companies with restricted cash or restricted cash equivalents must disclose any changes on cash flow statements. Impacted companies must now explain the change in the total of cash, cash equivalents, and amounts usually labeled as restricted cash or restricted cash equivalents. Such amounts are to be included with cash and cash equivalents when reconciling both the beginning and end of period total amounts disclosed on cash flow statements. ASU. Read More.
The ASBCA Issues Two CAS Decisions
By: John Ford , Senior Consultant, Government Contractor Services Group Recently, the Armed Services Board of Contract Appeals (“ASBCA” or “the Board”) issued two decisions relating to the Cost Accounting Standards (“CAS”) that should be of interest to contractors. In the first decision, Raytheon Company, Space and Airborne Systems, ASBCA No. 58608 (August 19, 2016), the Board decided that the contracting officer had abused her discretion by failing to consider all the factors listed in Federal Acquisition Regulation (“FAR”) 9903.305 in determining whether increased costs to the government resulting from an accounting practice change were material. As a large contractor doing billions. Read More.
Revenue Recognition Narrow-Scope Amendments and Practical Expedients Issued
The Financial Accounting Standards Board has issued Accounting Standards Update (“ASU”) No. 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients. ASU No. 2016-12 clarifies guidance in certain areas and adds practical expedients. The updated guidance and practical expedients in the amendments include the following: Assessing the Collectibility Criterion in Paragraph 606-10-25-1(e) and Accounting for Contracts That Do Not Meet the Criteria for Step 1 (Applying Paragraph 606-10-25-7). ASU No. 2016-12 clarifies the collectibility criterion in Step 1, and adds a new criterion to paragraph 606-10-25-7 which clarifies when revenue is recognized for a contract that. Read More.
Credit Loss Standard Coming in June
According to Financial Accounting Standards Board (“FASB”) member Lawrence Smith, the standard setter is on track to publish Accounting Standards Update No. 2012-260, Financial Instruments — Credit Losses (Subtopic 825-15). Despite numerous delays, Smith said that the updated guidance for writing down bad loans and securities is scheduled to be issued by June 30th. The FASB also plans to meet again later this month to consider the standard’s costs and benefits, as well as revisit the previously agreed upon 2019 effective date for public entities.