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FASAC Members Want More Transparency on Non-GAAP Measures

During talks last month on possible uniform non-GAAP measures in companies’ financial statements, several members of the Financial Accounting Standards Board’s (“FASB”) Financial Accounting Standards Advisory Council (“FASAC”) advocated requiring companies to provide more details about their non-standard earnings metrics. Indiana University professor Patrick Hopkins acknowledged that some non-GAAP measures allow companies to disclose industry-specific information not reflected in accounting standards. He also argued that if the FASB or Securities and Exchange Commission required more transparency regarding how measures are defined, investors and analysts could better understand the information. Supporting Hopkins’ call for increased transparency was Douglas Oare, managing director. Read More.

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FASB Declines Request for More Relief from Hedge Accounting Requirements

The Financial Accounting Standards Board (“FASB”) has turned down the Private Company Council’s (“PCC”) request for additional exemptions from its upcoming hedge accounting proposal. Decided on December 21st, the FASB said the PCC’s request for more relief from the proposal’s documentation requirements to justify their qualifications for specialized hedge accounting had little merit. The standard setter has already decided to simplify some of the documentation requirements. The FASB plans to publish its hedge accounting proposal in the first quarter of 2016.

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FASB Adds Nonprofit Consolidation Reporting and Nonemployee Share-Based Compensation Projects

As a result of its December 16th meeting, the Financial Accounting Standards Board (“FASB”) has added the following two projects to its standard-setting agenda: Nonprofit consolidation reporting. The FASB will propose guidance clarifying when a nonprofit group serving as a general partner should report the holdings of a for-profit limited partnership on its balance sheets. Some nonprofits previously said that the guidance was not clear in Accounting Standards Update No. 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis. Nonemployee share-based compensation. Subtopic 505-50, Equity—Equity Based Payments to Non-Employees, addresses some of the accounting for nonemployee share-based payments, but the. Read More.

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FASB and IASB Discuss Changes to Principal versus Agent Considerations

During its joint meeting on December 16th, the Financial Accounting Standards Board (“FASB”) and International Accounting Standards Board (“IASB”) redeliberated proposed amendments to the principal versus agent guidance. The meeting was in response to feedback received on the boards’ exposure drafts, FASB Proposed Accounting Standards Update, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net), and IASB Exposure Draft, Clarifications to IFRS 15. During redeliberations, the FASB and IASB reached tentative decisions in regard to the following: Principle for determining whether an entity is a principal or an agent; Unit of account for. Read More.

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U.S. GAAP Update to Offer Accounting Alternative for Private Companies

Last month, the Financial Accounting Standard Board (“FASB”) approved a proposal that would offer private companies an easier method to adopt special accounting alternatives from U.S. GAAP. Scheduled to be published in early 2016, the proposal is in response to the Private Company Council’s (“PCC”) calls for accounting changes. In September, the FASB issued Proposed Accounting Standards Update No. PCC-15-01, Intangibles—Goodwill and Other (Topic 350): Business Combinations (Topic 805): Consolidation (Topic 810): Derivatives and Hedging (Topic 815): Effective Date and Transition Guidance — a Proposal of the Private Company Council. The proposal eliminates the effective dates for the following accounting. Read More.

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Fair Value Measurement Proposal Released

The Financial Accounting Standards Board (“FASB”) has unanimously approved the release of a proposal related to its disclosure framework project. Proposed Accounting Standards Update No. 2015-350, Fair Value Measurement (Topic 820): Disclosure Framework— Changes to the Disclosure Requirements for Fair Value Measurement, seeks to improve the footnote disclosure rules under Topic 820, Fair Value Measurement. The proposal calls for the elimination of requirements in Topic 820 considered redundant and no longer useful, as well as updates to other rules. As mentioned in our December 7th blog , the FASB also proposes the addition of three new disclosure requirements for public businesses: The changes. Read More.

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