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IRS Releases 2019 Form to Help Governments Report Fines, Penalties, and Other Amounts

A new 2019 form has been issued by the Internal Revenue Service (“IRS”) to help governments and government entities comply with a portion of the Tax Cuts and Jobs Act (“TCJA”) involving reporting fines or penalties. Form 1098-F requires governments and related entities to disclose fines, penalties, or other amounts assessed against a taxpayer. Government agencies and related entities must file Form 1098-F with the IRS and the taxpayer to report information about the fine or court settlement, whether one or multiple payments will be made, and the total payments actually made by the taxpayer. The new form also requires that reportable penalties. Read More.

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Updated Proposal on Income Tax Disclosures Coming

The Financial Accounting Standards Board (“FASB”) last week instructed staff to draft a proposed Accounting Standards Update (“ASU”) concerning its revised proposal for income tax disclosures. To be issued for public comment, the revised proposed ASU will feature every change made since the FASB released the original proposed ASU, Income Taxes (Topic 740): Disclosure Framework—Changes to the Disclosure Requirements for Income Taxes. Such changes include requiring disclosure of the disaggregation of income tax expense/benefit and income taxes federal or national, state, and foreign amounts pay. The FASB noted that income tax expense/benefit and income taxes paid on foreign earnings enacted. Read More.

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Staff to Perform Field Testing on FASB Government Assistance Project

Members of the Financial Accounting Standards Board (“FASB”) want to perform additional outreach concerning the board’s government assistance project. During its February 27 meeting, the FASB agreed that staff members should conduct further field testing to confirm the costs and benefits of a proposal under Accounting Standards Update (“ASU”) No. 2015-340, Government Assistance (Topic 832) Disclosures by Business Entities about Government Assistance. The government assistance project aims to require businesses to disclose information on financial assistance like government grants and low-interest loans. Governments often distribute such assistance to encourage business relocation or expansion in a jurisdiction. Some investors, however, believe these. Read More.

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AICPA Board to Align Materiality with U.S. Standard-Setters

At a meeting in January, the American Institute of Certified Public Accountants’ (“AICPA”) Auditing Standards Board (“ASB”) agreed to align its “materiality” definition with the definitions used by the Financial Accounting Standards Board (“FASB”), Securities and Exchange Commission (“SEC”), and Public Company Accounting Oversight Board (“PCAOB”). The narrow project aims to remove inconsistencies in the definition among AICPA Professional Standards and the Supreme Court, SEC, FASB, and the PCAOB. The effort comes after the FASB’s decision last year to revert to its original “materiality” definition from 1980 to 2010. The FASB revised its definition to align its concept of materiality to determine what information should be included and omitted from a. Read More.

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FASB to Review Credit Loss Standard Alternative for Regional Banks

In response to requests for a different method for calculating loan losses under Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, the Financial Accounting Standards Board (“FASB”) plans to determine whether to undertake a limited-scope standard-setting project for regional banks. At the board’s April 3 meeting, FASB staff will present its research on the proposed alternative approach. Board members will take up the issue, reject the alternative, or conduct more research. The decision to discuss the alternative comes after a November 2018 letter from over 20 regional banks asking the FASB to consider an alternative. During a January. Read More.

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FAQs on Revised Treatment of Incomplete or Inadequate Prime Contractor Cost

By: Eric Poppe , Senior Manager On January 15, 2019, we posted a blog titled “ Revised Treatment of Incomplete or Inadequate Prime Contractor Cost ”. The blog discussed the new guidance detailed in the Memorandum for Regional Directors (“MRD”) issued on November 27, 2018. Effective immediately, Defense Contract Audit Agency (“DCAA”) auditors must perform ‘alternative procedures’ on subcontractor costs included in proposals when the cost or pricing analysis completed by the prime contractor has not been completed or deemed inadequate. As we outlined in the blog, those alternative procedures could include: Creating a decrement based on purchase order history; Creating a decrement based on other relevant information (e.g., comparisons of. Read More.