SEC Gives Certain Companies Additional Year to Adopt Key FASB Standards
Securities and Exchange Commission (“SEC”) Deputy Chief Accountant Sagar Teotia has announced that companies that fail to meet the public business entity definition, separate from being required to include financial statements with their filings of public business entities, will receive an additional year to adopt the Financial Accounting Standards Board’s (“FASB”) revenue recognition and lease standards. Decided at the FASB’s Emerging Issues Task Force meeting last week, Teotia said his staff will not object to the affected companies complying with Accounting Standards Update (“ASU”) No. 2014-09, Revenue From Contracts With Customers (Topic 606), and ASU No. 2016-02, Leases (Topic 842),. Read More.
Topics: Accounting Standards Update "ASU", FASB, Financial Accounting Standards Board "FASB", lease accounting, Leases (Topic 842), Revenue from Contracts with Customers (Topic 606), Revenue Recognition, SEC, Securities and Exchange Commission "SEC"
Dodd-Frank Whistleblower Protections Headed to Supreme Court
This October, the U.S. Supreme Court plans to review whistleblower protections under the Dodd-Frank Act. Announced on June 26, the decision to hear the case of Somers v. Digital Realty Trust will resolve who is protected from possible retaliation under the reform law. The case revolves around former Vice President Paul Somers of Digital Realty Trust Inc., who was fired after reporting to management potential securities law violations. Somers sued Digital Realty Trust Inc. for allegedly violating Dodd-Frank’s whistleblower rules, but the dispute centers on where he initially reported the transgression. Digital Realty’s lawyers contended that since Somers’ concerns were. Read More.
PCAOB Approves Expanded Auditor’s Report
In a unanimous decision, the Public Company Accounting Oversight Board (“PCAOB”) has approved a rule to expand auditor reports in a Securities and Exchange Commission (“SEC”) filing. Announced on June 1, the new format will make filed auditor reports more valuable to investors. The rule requires a public company’s external auditor to disclose any critical audit matters that arise while auditing their clients, and provide details on clients’ financial reporting procedures. Such requirements are listed under Release No. 2017-001, The Auditor’s Report on an Audit of Financial Statements When the Auditor Expresses an Unqualified Opinion and Related Amendments to PCAOB. Read More.
Forums on Auditors of Broker-Dealers Coming This Fall
The Public Company Accounting Oversight Board (“PCAOB”) has released the schedule for its 2017 Forums for Auditors of Broker-Dealers. Only two forums are set for this year, which will be held at the following locations: Las Vegas, Nevada, on October 20, 2017 Jersey City, New Jersey, on December 7, 2017 This year’s forums include case studies and discussions on inspection observations and trends, enforcement issues, and auditor independence. Securities and Exchange Commission and the Financial Industry Regulatory Authority staff members will lead presentations on agenda topics. In addition, there will be an auditing standards update and a panel discussion about professional. Read More.
Topics: Financial Industry Regulatory Authority "FINRA", Forums for Auditors of Broker-Dealers, PCAOB, PCAOB Agenda, Public Company Accounting Oversight Board "PCAOB", Securities and Exchange Commission "SEC"
SEC Asked to Use Principles-Based Approach for Disclosure Updates
In response to the Securities and Exchange Commission’s (“SEC”) efforts to amend the disclosure requirements for bank holding companies, one Big Four accounting firm has asked the agency to develop a principles-based framework. One Big Four firm remarked that disclosures under a principle-based approach would better align with how registrants oversee their business. The firm said such disclosures may help financial information users since the requirements allow a registrant to exercise judgment in reviewing how to meet compliance. In addition, the Big Four firm noted that while strict and consistent requirements could help investors compare banks, they typically do not. Read More.
Final Standard for Securities Offerings Documents Approved
Last month, the American Institute of Certified Public Accountants’ Auditing Standards Board unanimously approved a final standard concerning an auditor’s responsibility regarding securities offerings documents not registered with the Securities and Exchange Commission (“SEC”). The final standard will likely be issued as Statement on Auditing Standards No. 133: Auditor Involvement With Exempt Offering Documents. It would impact securities that are not required to follow the SEC’s registration requirements and rules under the Securities Act of 1933. In addition, the standard will affect franchise offerings controlled by the Federal Trade Commission or appropriate state franchise laws. The standard could become effective. Read More.