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Following the World Trade Center's destruction, airlines, hotels, insurers and other financial services companies wrestle with financial reporting issues related to the disaster. In response, FASB's emerging issues task force takes tentative positions on when financial statements should classify as extraordinary certain losses or other costs related to the incident, when to recognize such losses or costs and whether financial statements should provide additional information about the attack's economic consequences. (www.fasb.org/eitf/issue01-10.pdf)

The Financial Executives International and the National Investor Relations Institute together issue best practices to help companies comply with SEC Regulation FD, which requires them to share earnings guidance and other material information equally with all market participants. For example, according to one recommendation, a company should offer as much guidance in its quarterly news releases as it is comfortable providing. (www.niri.org/publications/alerts/EA091001.cfm)

The Treasury Department issues its 2001 National Money Laundering Strategy. As in the past, the plan warns of the negative roles lawyers, bankers and accountants can intentionally or unintentionally play in abetting criminal efforts to disguise unlawful income. But this year’s strategy also focuses on training lawyers and accountants to recognize and report potential signs of money laundering. Further, the plan calls for them to help law enforcement agencies and the financial industry better fight money laundering by making optimal use of information financial institutions are required to report to regulators. ( www.treas.gov/press/releases/docs/ml2001.pdf )

The Financial Accounting and Standards Advisory Board (FASAB) requests comments on an exposure draft. Titled Accounting for National Defense PP&E and Associated Cleanup Costs, the ED amends current standards for ND property, plant and equipment by changing its definition, the method of accounting for it and the information reported about it. The ED also proposes that such PP&E consist of two separate categories of items—major end items and mission-support items. This approach, FASAB says, makes it easier to apply expense recognition standards and disclosures for different types of these items. Comments are due by November 29. (www.financenet.gov/financenet/fed/fasab/exposure.htm)

The International Accounting Standards Board (IASB) seeks additional comments on its July 2000 discussion paper, Accounting for Share-Based Payment, which advocated fair-value reporting of stock and options paid to employees. Because it would reduce their reported profits, companies around the world strongly oppose the IASB’s proposal. Comments are due by December 15. (www.iasb.org.uk/cmt/0001.asp?s=100343464&sc={38CE5284-AEF3-11D5-BE6B-003048110251}&n=3338)

The IASB Standing Interpretations Committee issues two draft interpretations for public comment: SIC-D33, Consolidation and Equity Method—Potential Voting Rights ; and SIC-D34, Financial Instruments—Instruments or Rights Redeemable by the Holder . Comments are due to the IASB by November 5. (www.iasb.org.uk/cmt/0001.asp?s=100343464&sc={38CE5284-AEF3-11D5-BE6B-003048110251}&n=2011)

Internal auditing of banks is the focus of a new best-practice paper from the Basel Committee on Banking Supervision. The committee stresses that boards of directors and senior management have ultimate responsibility for banks’ internal controls—even when they choose to outsource the internal auditing function. ( www.bis.org/publ/bcbs84.htm )

A new study from the International Federation of Accountants— Governance in the Public Sector: A Governing Body Perspective —describes governance principles and their application to the public sector. It also includes an overview of public-sector accountability arrangements. ( www.ifac.org/News/LastestReleases.tmpl?NID=9977167461116&RanID=897825 )

Despite the destruction of the SEC’s northeast regional office at 7 World Trade Center in the September 11 attacks, Chairman Harvey L. Pitt promises thorough processing of all that office’s investigations. ( www.sec.gov/news/testimony/092001tshlp.htm )

Members of the New York State Society of CPAs are donating their services to businesses and individuals affected by the World Trade Center disaster. Since early October, the society has staffed an information table at 110 Maiden Lane in New York’s financial district. There, CPAs help victims complete applications for federal disaster assistance and share their expertise on matters related to insurance, tax returns, pensions and small businesses. Telephone consultations are available by calling the society at 800-NYSSCPA. ( www.nysscpa.org )

The Treasury Department and IRS provide administrative tax relief for individual and business taxpayers who were prevented from meeting their federal tax obligations as a result of the September 11 terrorist attacks. The relief applies to all affected taxpayers, regardless of where they reside. ( http://ftp.fedworld.gov/pub/irs-news/ir-01-81.pdf )

The Social Security Administration relaxes documentation rules for claims related to the attack on the World Trade Center and issues a reminder that survivors’ benefits may be available to the families of those who perished. The agency adds that those critically injured—whether physically or mentally—may be eligible for Social Security disability benefits. (www.ssa.gov/emergency.htm; www.ssa.gov/pressoffice/releaseattack.htm )

The Labor Department’s Pension and Welfare Benefits Administration (PWBA), the IRS and the Pension Benefit Guaranty Corporation extend the deadline for filing employee benefit plan report forms 5500 and 5500-EZ. In addition, the PWBA offers plan fiduciaries guidance on ERISA compliance. ( www.dol.gov/dol/pwba/public/media/press/Pr091401.htm )

Dozens of CPAs and CPA/PFSs are among the nation’s financial planning elite, says the September issue of Worth magazine in the publication’s annual ranking of the best in the field. (www.worth.com/content_articles/articles.cfm?id=42)

Robert K. Herdman, until recently a senior partner at Ernst & Young, is the SEC’s new chief accountant, effective October 8. ( www.sec.gov/news/press/2001-95.txt )

The IRS’s Electronic Federal Tax Payment System (EFTPS) is now available on the Internet, making it possible to pay federal taxes through a secure Web site. ( www.eftpsnorth.com )

In a recent status report, FASB explains the financial reporting objectives and fundamental goals that constitute its conceptual framework. (www.fasb.org/statusreport_articles/august2001.pdf)

The 16th World Congress of Accountants will take place in Hong Kong’s Convention and Exhibition Centre November 18–21, 2002. The Hong Kong Society of Accountants and the International Federation of Accountants are organizing the gathering, which they expect to attract accounting and business leaders from around the world. (www.wcoa2002.com)

Correction

The article “Say Good-Bye to Pooling and Goodwill Amortization” ( JofA, Sept.01, page 31) erred in explaining the term goodwill . On page 32, under the subhead Recognizing Goodwill, it reads, “Goodwill is the difference between what a company paid for an acquisition and the book value of the net assets of the acquired company.” It should read, “Goodwill is the difference between what a company paid for an acquisition and the fair value of the net assets of the acquired company.” The book value of the identifiable net assets at acquisition is the amount at which they were recorded (or carried) on the books of the acquired company. The fair value is the amount that such assets could be sold for at the date of acquisition.

This concept is correctly shown on page 34 in the exhibit, “New Rules Illustrated.” A company’s identifiable net assets have a book value of $650 and a fair value of $800. The acquiring company paid $1,000 for the assets, of which $200 is considered goodwill. We regret the error.

The SEC responds to the financial markets’ urgent needs in the wake of the attack on the World Trade Center. For the first time, the agency uses its emergency powers to grant temporary relief from regulatory restrictions on certain activities including companies’ repurchase of their own securities, brokerage firms’ calculation of net capital, mutual funds’ borrowing from and lending to related parties and accountants’ provision of bookkeeping services to clients in the stricken area. ( www.sec.gov/news/press/2001-91.txt ; www.sec.gov/news/press/2001-97.txt )