FASB proposal would guard private companies’ proprietary information

BY KEN TYSIAC

Stakeholders have expressed concerns to FASB that certain disclosure requirements for nonpublic employee benefit plans would reveal sensitive proprietary information of private companies.

FASB is addressing that concern by proposing an indefinite deferral of the effective date for certain disclosures about investments held by a nonpublic employee benefit plan in the plan sponsor’s own equity securities.

Comments are sought by May 31 on FASB’s website on Proposed Accounting Standards Update (ASU), Fair Value Measurement (Topic 820): Deferral of the Effective Date of Certain Disclosures for Nonpublic Employee Benefit Plans in Update No. 2011-04.

Stakeholders have been concerned that proprietary information about private companies would be divulged through the dissemination of their employee benefit plans’ financial statements on the plan regulator’s website.

The deferral is proposed to allow time for regulators and stakeholders to discuss the specific quantitative disclosures and their potential effect on the plan sponsor as a result of making that information public. The proposed deferral would be effective when the final ASU is issued. The ASU is expected to be released in June.

Ken Tysiac ( ktysiac@aicpa.org ) is a JofA senior editor.

SPONSORED REPORT

Cybersecurity threats proliferating for midsize and smaller businesses

This report details how SMBs can properly protect private information from breaches, design and implement a cybersecurity policy, and create safeguards for training and education.

CHECKLIST

Being responsive to clients

CPAs and their firms have daily pressures and hectic schedules, but being responsive is crucial to client satisfaction. Leaders in the profession offer advice for CPA firms that want to be responsive to clients.

QUIZ

Test yourself on these often confused words

The spelling checker on your word processing program can do only so much to flag problems. Your best insurance is to learn the troublesome words that trip up writers and use them correctly by the standards of formal, written English.