Accounting


FASB issued Staff Position (FSP) FAS 123(R)-1, Classification and Measurement of Freestanding Financial Instruments Originally Issued in Exchange for Employee Services under FASB Statement No. 123(R) ( www.fasb.org/fasb_staff_positions/fsp_fas123r-1.pdf ). The board, which continues to believe freestanding financial instruments should be accounted for consistently, plans to consider broadly the distinction between liabilities and equity—a project that could significantly change other applicable GAAP. The FSP therefore defers the requirement in the statement, Share-Based Payment , that a freestanding financial instrument originally subject to the statement becomes subject to the recognition and measurement requirements of other applicable GAAP when the rights conveyed by the instrument to the holder no longer depend on his or her being an employee of the entity. The guidance is effective upon the entity’s initial adoption of the statement.

The AICPA issued three accounting technical practice aids. TPAs 6930.09 and 6930.10 pertain, respectively, to single-employer and multiemployer benefit plans. Each TPA contains a question and answer on accounting and disclosure requirements related to the Medicare Prescription Drug, Improvement and Modernization Act of 2003. TPA 5400.05 identifies issues and relevant literature nongovernment entities should consider in their accounting and disclosures related to losses from natural disasters. All three TPAs are available at www.aicpa.org/members/div/acctstd/general/recent_tpas.asp .

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Tax reform changes are now in effect

With all the recent tax law changes, this year it’s more important than ever to make sure your clients’ tax situations are squared away before year end. This report provides necessary guidance to ensure 2019 starts without a hitch.

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Using drones to enhance audits

Hermann Sidhu, CPA, global assurance digital leader at EY, walks us through EY’s exciting new project to use drones to help audit large warehouses and outdoor inventories.