Effective March 4, SEC rules allow foreign private issuers listing securities in the United States to report exclusively in International Financial Reporting Standards (IFRS) without reconciling their financial statements to U.S. GAAP. Israel is second only to Canada in the number of foreign private issuers that register with the SEC
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TOPICS
Accounting & reporting
Auditing
For news from the AICPA and state societies, visit www.cpa2biz.com, which also offers online CPE, AICPA professional literature, practice management aids and links to state society Web sites. The PCAOB voted to adopt Auditing Standard no. 6, Evaluating Consistency of Financial Statements, and an accompanying set of amendments to
Financial Reporting
FASB approved proposed FASB Staff Position no. FIN 48-2, Effective Date of FASB Interpretation No. 48 for Certain Nonpublic Enterprises, which defers the effective date of FIN 48 for qualified entities to the annual financial statements for fiscal years beginning after Dec. 15, 2007, unless they have issued a full
International
n The International Public Sector Accounting Standards Board, an independent standard-setting board within the International Federation of Accountants, issued requirements to help governments and other public sector entities consistently report on international aid, development grants and other forms of external assistance. The disclosure requirements and recommendations are set out in
Spending on SOX
According to The Sarbanes-Oxley Investment: A Section 404 Cost Study for Smaller Public Companies , a study by SOX research and consulting firm Lord & Benoit, the total average combined costs of complying with section 404(a) and section 404(b) was $78,457. The costs ranged from as little as $23,000 for
Data Point: 87
The proportion of multinational enterprises that believe transfer pricing is a risk when managing financial statements, as compliance requirements have increased due to developments in financial reporting. More than half of the enterprises surveyed have undergone a transfer pricing examination since 2003, with 27% resulting in adjustments by tax authorities.
2007 in Review: Congressional Impact on CPA Profession
Last year, CPAs had plenty of reasons to pay attention to policymakers’ proposals. Legislation under consideration has the potential to improve tax practices, alter audit practices, and even pave the way for greater competition. AICPA VP Testifies Before Senate Panel on International Accounting Standards Last fall, the Senate Banking
Highlights
The SEC’s Committee on Improvements to Financial Reporting voted in January to support a slate of preliminary recommendations designed to make the information presented by U.S. public companies more useful to investors while reducing the complexity of the financial reporting system. The preliminary proposals included a call for
Auditing
For news from the AICPA and state societies, visit www.cpa2biz.com, which also offers online CPE, AICPA professional literature, practice management aids and links to state society Web sites. “We were motivated to develop and issue this alert by the auditing challenges presented by the subprime credit situation and its effects
What the World Will Be Watching
With respect to accountants in business and industry, respondents to IFAC’s first annual Global Leadership Survey labeled several issues as “very important” over the next year, including: Applying new accounting standards (56%) Adopting good practice in internal control and risk management (50%) Perceptions of accountants’ integrity by the public and
Auditing
For news from the AICPA and state societies, visit www.cpa2biz.com, which also offers online CPE, AICPA professional literature, practice management aids and links to state society Web sites. The letter is co-signed by CAQ Governing Board Chairman James S. Turley, chairman and CEO of Ernst & Young LLP, and
Highlights
FASB tentatively approved a one-year delay in the effective date for FIN 48, Accounting for Uncertainty in Income Taxes, for private enterprises, including not-for-profit organizations. Acting on a request from the Private Company Financial Reporting Committee for a deferral, the FASB board is seeking public comment on a
Driving Change: Judith O’Dell
Judith O’Dell is the chair of the Private Company Financial Reporting Committee, which advises FASB and advocates for private companies on matters of existing and prospective accounting standards. The permanent committee—created by the AICPA and FASB in late 2006—gained traction on its first major project
Auditing
For news from the AICPA and state societies, visit www.cpa2biz.com, which also offers online CPE, AICPA professional literature, practice management aids and links to state society Web sites. The findings were based on inspections conducted between 2004 and 2006. The PCAOB released a report on the deficiencies to help
House Passes Tax Strategy Patent Ban, FHA Overhaul Legislation
On Sept. 7, the House of Representatives passed major patent reform legislation, which would ban the issuance of patents on tax strategies. The AICPA is a strong advocate of Congress’ work in this area. The comprehensive patent reform bill (HR 1908) also contains provisions unrelated to patents on
Opportunity Detected
EXECUTIVE SUMMARY The crux of the SEC’s interpretive guidance for management is a top-down, risk-based approach that puts risk first and foremost. Four key areas of opportunity can be used to reduce an organization’s overall SOX 404 compliance effort— risk assessment, entity-level controls, control selection and testing
ESOARS: A Flawed Product
Steven Balsam’s article (“ A Bid for Fair Value,” Sept. 07, page 42) fails to discuss an evaluation of the suitability of Zions ESOARS performed, at the request of the Council of Institutional Investors, by noted valuation expert Stephen A. Ross and his colleagues at Compensation Valuation Inc. (“CVI Report”).
The Finer Points of Fair Value
EXECUTIVE SUMMARY To adopt FASB Statement no. 159, companies must comply with the requirements of Statement no. 157, Fair Value Measurements . Companies and their auditors must consider whether the use of fair value option accounting reflects a “substance over form” decision by management rather than an
Software Revenue Recognition on the Rise
EXECUTIVE SUMMARY Statement of Position (SOP) 97-2 provides guidance on applying GAAP in recognizing revenue from software and software-related transactions. The SOP provides instruction on recognition for licensing, selling, leasing or otherwise marketing software. As technology becomes further entrenched in consumer and enterprise products, companies outside of the traditional
Highlights
The Center for Audit Quality issued a set of white papers to address issues practitioners may encounter as a result of the “liquidity crisis” spurred by deterioration in the markets for subprime mortgages and related securities. The CAQ Professional Practice Executive Committee said firms would benefit from the
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