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Accounting & reporting
Financial Reporting
“The next steps that the Commission is announcing today will keep us on course with the Roadmap announced in 2005,” SEC Chairman Christopher Cox said in a press release. Pending public comments on the proposal, “we remain on track to eliminate reconciliation by 2009.” In a staff position document, FASB
Simplifying Global Accounting
As chair of the London-based International Accounting Standards Board, Sir David Tweedie is championing an effort to develop a single set of global financial reporting standards that will be both understandable and enforceable. More than 100 countries now require or permit the use of International Financial Reporting
International
The SEC, the United Kingdom Financial Services Authority (FSA) and the United Kingdom Financial Reporting Council (FRC) signed a protocol for implementing the work plan between the SEC and the Committee of European Securities Regulators to share information on application of International Financial Reporting Standards (IFRS) by issuers listed in
ROI on XBRL
EXECUTIVE SUMMARY The reality of XBRL has grown exponentially over the past two years, in large part due to the SEC’s focus and encouragement. With the time, money and effort that Chairman Cox and the SEC have dedicated to this initiative, it appears highly likely that
Highlights
FASB issued an exposure draft that calls for expanded disclosure about financial guarantee insurance contracts. The ED, Accounting for Financial Guarantee Insurance Contracts—an Interpretation of FASB Statement No. 60, would, among other things, reduce diversity in the way financial guarantee insurance contracts are accounted for by insurers. That diversity has
Two Years and Counting
EXECUTIVE SUMMARY This article examines the first two years of section 404 reporting data to determine whether section 404 has accomplished its intended purpose and what small companies can learn from the experience of large companies that have implemented section 404 requirements. The number of companies reporting material weaknesses in
Closing the Gaps in GAAP
EXECUTIVE SUMMARY GASB regularly issues implementation guides, which are staff “question and answer” (Q&A) documents that are intended to reflect the GASB staff’s understanding of the board’s intent when it adopted the related statements. Implementation guides have a relatively low level of authority in the government
IFRS: Coming to America
EXECUTIVE SUMMARY International Financial Reporting Standards (IFRS) are destined to be the lingua franca of the international accounting world. Approximately 100 countries already require, allow or are in the process of converging their national accounting standards with IFRS. FASB and the IASB have agreed to converge
Financial Reporting
At an open meeting in April, the SEC endorsed the recommendations of the agency’s professional staff to eliminate waste and duplication in Sarbanes-Oxley section 404 compliance, a move intended to benefit smaller public companies. The SEC’s direction to its staff will focus on aligning the PCAOB’s new auditing standard (AS-5)
International
The SEC released new rules that will make it easier for foreign companies to deregister from U.S. exchanges if there is not significant interest in their securities offerings. By eliminating conditions that had been considered a barrier to entry, the SEC says the amended rules will encourage participation in U.S.
Highlights
Eight states have introduced “no notification” legislation since early 2007 as part of an effort to implement a uniform approach to cross-state mobility through the concept of substantial equivalency. The legislation in Hawaii, Indiana, Maine, Missouri, Oklahoma, Rhode Island, Tennessee and Texas, if passed, would remove the
Avoiding FASB 123(R) Pitfalls
EXECUTIVE SUMMARY FASB Statement no. 123(R), Share-Based Payment, poses a potential dilemma for companies with net operating losses (NOLs) that award nonqualified stock options (NQSOs) as compensation. If a company’s allowable tax deduction for stock option compensation exceeds the related book expense, it can realize an
Perfect Storm Prompts Changes in Pension Accounting
EXECUTIVE SUMMARY FASB has issued Statement no. 158, Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans, to reform accounting for pension and other postretirement benefit plans. The new statement requires companies to move off-balance-sheet items onto their financial statements. The schedule of comprehensive income
Employee Benefits
In a staff position document, FASB amended several statements to conform with pension-reporting requirements of Statement no. 158, Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans. FASB Staff Position FAS 158-1 also revised implementation guidance for Statement no. 158 and made technical revisions to the statement itself. Statement
Financial Reporting
A second, related FASB exposure draft is Not-for-Profit Organizations: Goodwill and Other Intangible Assets Acquired in a Merger or Acquisition. Both are part of a FASB project on business combinations. The AICPA issued Interpretation no. 29, Reporting on an Uncertainty, Including an Uncertainty About an Entity’s Ability to Continue as
Extraordinary Items Share Exclusive Company
EXECUTIVE SUMMARY Material gains and losses are classified as “extraordinary” on the income statement when they are both “unusual” and “infrequent.” Extraordinary items are reported at the bottom of the income statement, net of their tax effects. FASB Statement no. 145 significantly shortened the list of
International
The trustees of the International Accounting Standards Committee (IASC) Foundation published the Due Process Handbook for the International Financial Reporting Interpretations Committee. In May 2006, the IASC Foundation released a draft of the handbook for public comment. The trustees approved an amended version at their January meeting. The handbook can
Highlights
FASB issued a standard that gives companies the option to report selected financial assets and liabilities at fair value. Statement of Financial Accounting Standards no. 159, The Fair Value Option for Financial Assets and Financial Liabilities, is designed to reduce complexity in accounting for financial instruments and
A Road Map for Share-Based Compensation
EXECUTIVE SUMMARY Since FASB Statement no. 123(R) began requiring companies to recognize an expense equal to the grant-date fair value of options awarded as compensation, there has been a significant change in share-based payments to employees. Companies are taking a fresh look at the alternatives available to
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