AICPA Publishes Revenue Recognition Audit and Accounting Guide
Offering guidance for applying the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Update (“ASU”) No. 2014-09, Revenue From Contracts With Customers, the American Institute of Certified Public Accountants (“AICPA”) has issued Audit and Accounting Guide (AAG): Revenue Recognition. The publication addresses issues to consider when auditors examine the revenue disclosed in financial statements, internal controls, fraud risks, and the assessment auditors must make on the accuracy of management’s estimates. The AICPA’s revenue recognition guide is based on the efforts of the task forces that worked under their Financial Reporting Executive Committee since the FASB issued its landmark standard and the International Accounting. Read More.
Topics: American Institute of Certified Public Accountants "AICPA", Financial Accounting Standards Board "FASB", International Accounting Standards Board "IASB", Revenue from Contracts with Customers (Topic 606), Revenue Recognition
New Technical Auditing Questions and Answers Issued for Investment Companies
The following Technical Questions and Answers guidance has been added under Section 6910, Investment Companies, by the American Institute of Certified Public Accountants: Section 6910.36, Determining Whether Loan Origination Is a Substantive Activity When Assessing Whether an Entity Is an Investment Company Section 6910.37, Considering the Length of Time It Will Take an Investment Company to Liquidate Its Assets and Satisfy Its Liabilities When Determining If Liquidation Is Imminent Section 6910.38, Determining If Liquidation Is Imminent When the Only Investor in an Investment Company Redeems Its Interest, and the Investment Company Anticipates Selling All of Its Investments and Settling All. Read More.
SEC’s Bricker Discusses Credit Loss Standard
The Financial Accounting Standards Board’s (“FASB”) standard for reporting credit losses was the subject of Wesley Bricker’s speech at last week’s American Institute of Certified Public Accountants’ National Conference on Banks & Savings Institutions. Bricker, the Security and Exchange Commission’s (“SEC”) Interim Chief Accountant, addressed the importance of implementing Accounting Standards Update No. 2016-13, Financial Instruments—Credit Losses (Topic 326). In particular, Bricker encouraged companies to work with their audit committees and auditors to review implementation plans so the new standard meets the reporting objectives. He also noted that the implementation process requires collaboration between all stakeholders when applying the standard’s. Read More.
Topics: American Institute of Certified Public Accountants "AICPA", Credit Loss Model "CECL", FASB Financial Instruments project, Financial Accounting Standards Board "FASB", Financial Instruments - Credit Losses (Topic 326), Securities and Exchange Commission "SEC"
Banks Urged to Prepare for FASB Credit Loss Standard
Banking institutions are advised to act fast on implementation plans for Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments — Credit Losses (Topic 326). At the AICPA National Conference on Banks and Savings Institutions last week, Louis Thompson of the Office of the Comptroller of the Currency told depository institutions to start preparing for the Financial Accounting Standards Board’s (“FASB”) current expected credit loss (“CECL”) standard. Thompson emphasized that due to the substantial changes in writing down bad loans and securities, implementation efforts should require full commitment and cooperation to ensure the new guidance is applied in a disciplined and. Read More.
Topics: American Institute of Certified Public Accountants "AICPA", Credit Loss Model "CECL", FASB Financial Instruments project, Financial Accounting Standards Board "FASB", Financial Instruments - Credit Losses (Topic 326)
Cybersecurity Risk Management Guidance Proposed
The following exposure drafts have been issued by the American Institute of Certified Public Accountants’ (“AICPA”) Assurance Services Executive Committee, offering guidance for evaluating cyber risk management: Proposed Description Criteria for Management’s Description of an Entity’s Cybersecurity Risk Management Program (“Description Criteria”). This exposure draft is intended for a company’s management when developing and describing its organization’s cybersecurity risk management program, and by public accounting firms for reporting the description of the program. The AICPA hopes developing a conventional set of criteria will clear the path for a cybersecurity examination to assist in evaluating the efficiency of an organization’s cybersecurity. Read More.
Working Drafts Offer Revenue Recognition Guidance for Telecommunications Suppliers
Revenue recognition implementation guidance could be on the way for telecommunications providers. Last week, the American Institute of Certified Public Accountants’ Financial Reporting Executive Committee issued two working drafts offering industry-specific guidance for adopting the Financial Accounting Standards Board’s Accounting Standards Update No. 2014-09, Revenue From Contracts With Customers. Proposed Issue #15-1– Portfolio Accounting, proposes that a telecommunications supplier can use the portfolio accounting shortcut when a large disparity does not exist when accounting for contracts jointly rather than individually. The draft guidance advises what suppliers should consider when deciding whether to use the portfolio approach. The second working draft,. Read More.