New Auditing Interpretations Have Been Issued Related to GASB 67 and 68
The American Institute of Certified Public Accountants (“AICPA”) recently issued interpretation of certain standards related to implementation of Governmental Accounting Standards Board (“GASB”) Statements 67 and 68. Summaries of these interpretations follow. If you are interested in additional information regarding your specific circumstance, you can find the interpretations on the AICPA’s website. Interpretations to Audit Evidence Standard Interpretation No. 2, “Auditor of Participating Employer in a Governmental Cost-Sharing Multiple-Employer Pension Plan,” of AU-C section 500, Audit Evidence, answers two questions. The first clarifies that the audited financial statements of a cost-sharing plan prepared, in accordance with generally accepted accounting principles. Read More.
Standard Setters Still at Odds over Lease Project
At their July 23rd joint meeting, the Financial Accounting Standards Board (“FASB”) and International Accounting Standards Board (“IASB”) resumed efforts to converge U.S. GAAP and IFRS. In particular, the top focus was FASB’s Proposed Accounting Standards Update (ASU) No. 2013-270, Leases (Topic 842), and IASB’s Exposure Draft (ED) No. 2013-6, Leases. Conflicted on recognizing the gains for sale-leaseback transactions, the boards continue to have opposing attitudes toward their lease accounting project. During the meeting, FASB agreed to allow sellers of assets to recognize the full gain from the time of the transaction. On the conflicting end, IASB agreed to let. Read More.
Updated Conceptual Framework Proposal Comment Letter Approved
During its July 15th teleconference, the American Institute of Certified Public Accountants’ Financial Reporting Executive Committee (“FinREC”) approved an updated draft comment letter related to the Financial Accounting Standards Board’s (“FASB”) Proposed Statement of Financial Accounting Concepts (CON) No. 2014-200, Conceptual Framework for Financial Reporting-Chapter 8: Notes to Financial Statements. Despite not providing official guidance to users of financial statements, the proposal offers guidelines for writing U.S. GAAP disclosure requirements. Signed by FinREC’s Richard Paul and Rick Day, the seven-page letter orders FASB to review current disclosure requirements, and remove repetitive disclosures and insufficient information. Per the letter, the simplification of disclosures will. Read More.
Topics: American Institute of Certified Public Accountants "AICPA", disclosure, Financial Accounting Standards Board "FASB", Financial Reporting Executive Committee "FinREC", Financial Statements, U.S. GAAP
SEC Releases New Documents on XBRL-Based Filings
Related to filings using eXtensible Business Reporting Language (XBRL), the U.S. Securities and Exchange Commission (“SEC”) has issued Staff Observations of Custom Tag Rates (“the Report”) and Sample Letter Sent to Public Companies Regarding XBRL Requirement to Include Calculation Relationships (“the Letter”). Per the SEC, the Report will help review the quality of XBRL exhibits issuers present to meet the agency’s requirements in filing financial statement information via XBRL format. The review will assist the SEC in defining a starting point for filers tagging financial statements when filing electronically, including how their actions have changes since completing the phase-in of issuer and. Read More.
FASB Continues U.S. GAAP Simplification Initiative
Hoping to streamline inventory measurement and remove the requirements for extraordinary items, the Financial Accounting Standards Board recently released two proposed Accounting Standards Updates. The proposals, which are part of FASB’s efforts to simplify U.S. GAAP , include: — Inventory (Topic 330): Simplifying the Measurement of Inventory. This proposal is in response to stakeholder concerns about the current guidance on measuring inventory. Currently, reporting entities are required to measure inventory at the lower of cost or market. The new guidance would require inventory to be measured at the lower of cost and net realizable value. Thus, it would eliminate existing requirements to consider the replacement cost. Read More.
FASB’s Going Concern Amendment to Affect PCAOB Standards
In the coming weeks, the Financial Accounting Standards Board (“FASB”) plans to release an amendment that requires struggling companies to inform investors regarding their chances of surviving. Entitled proposed Accounting Standards Update No. 2013-300, Presentation of Financial Statements (Topic 205)—Disclosure of Uncertainties about an Entity’s Going Concern Presumption, the update is in response to investors and regulators who believed auditors issued going concern reviews of companies after the stock price mirrored the market’s knowledge of their pending demise. Per the FASB’s final update to U.S. GAAP, a company will be required to add in its financial statement footnotes when “substantial. Read More.
Topics: Accounting Standards Update, American Institute of Certified Public Accountants "AICPA", Audit, Auditing Standards Board "ASB", Bruce Webb, disclosure, Financial Accounting Standards Board "FASB", Financial Statements, Going Concern, International Financial Reporting Standards "IFRS", Public Company Accounting Oversight Board "PCAOB", U.S. GAAP, U.S. Securities and Exchange Commission "SEC"