It took years of deliberation and professionwide collaboration to produce Statement on Standards for Accounting and Review Services (SSARS) No. 21. Here’s how the AICPA Accounting and Review Services Committee (ARSC) developed the standard, which was issued Oct. 23: Initial exposure draft On June 29, 2012, ARSC initially exposed for
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Accounting & reporting
Standards revised for reviews, compilations, engagements to prepare financial statements
Clarified and revised standards for compilations and engagements to prepare financial statements released Thursday create a bright line between accounting (preparation) and reporting (compilation) services. The AICPA Accounting and Review Services Committee (ARSC) released Statement on Standards for Accounting and Review Services (SSARS) No. 21, which contains significant changes for
When does Section 70 of SSARS No. 21 apply?
Section 70, Preparation of Financial Statements, of Statement on Standards for Accounting and Review Services No. 21, Statements on Standards for Accounting and Review Services: Clarification and Recodification, applies when an accountant in public practice is engaged to prepare financial statements. The following table provides examples of services that the
Reducing unnecessary complexity remains a key focus of FASB
Taking unnecessary cost and complexity out of the U.S. financial reporting system has been a primary objective for Russell Golden since he became FASB’s chairman in July 2013. FASB plans to continue its efforts to reduce complexity—while maintaining usefulness of reporting to financial statement users—in the coming years, Golden said
How NFPs should allocate joint costs
Not-for-profit management and auditors have the responsibility to make sure that costs are properly allocated for activities that serve their mission and also include fundraising opportunities. Learn how consistent application of accounting rules results in a fair depiction of these costs in not-for-profit financials.
PCC approves private company GAAP exception for certain acquired intangible assets
The Private Company Council (PCC) voted Tuesday to approve a GAAP alternative that will allow private companies to elect not to separately recognize and measure certain intangible assets acquired in a business combination. Private companies that elect the alternative would not recognize: Noncompetition agreements. Customer-related intangible assets that are not
Socially awkward
Total user accounts or total number of posts are used to tout some companies’ success, but those statistics don’t necessarily indicate profitability.
FASB’s proposed 2015 GAAP taxonomy available for comment
FASB released its proposed 2015 GAAP Financial Reporting Taxonomy on Friday and asked for public review and comment. The taxonomy is a list of financial reporting labels that are machine-readable and coded in XBRL. Users of financial statements can use the tags to electronically search for and process data so
COSO transition getting a close look from auditors
The early stages of implementation are over for many companies using the updated internal control framework of the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In 2013, the framework—which had been in use since 1992—was updated to reflect changes in the business environment. U.S. public companies have been
FASB defines management’s going-concern responsibilities
FASB issued a new financial reporting standard Wednesday defining management’s responsibility to evaluate whether there is substantial doubt about an organization’s ability to continue as a going concern and to provide related footnote disclosures. The standard provides new guidance, as current GAAP does not describe management’s responsibility to evaluate whether
Clarified, revised SSARS approved for reviews, compilations, and engagements to prepare financial statements
The AICPA Accounting and Review Services Committee (ARSC) voted during its meeting this month to approve clarified and revised standards for reviews, compilations, and engagements to prepare financial statements. The clarified and revised standards for compilations and engagements to prepare financial statements create a bright line between accounting (preparation) services
FASB proposes simpler accounting for fees paid to cloud service providers
FASB on Tuesday issued a proposal designed to simplify the accounting for fees that public and private companies pay as customers in cloud-computing arrangements with third-party service providers. Rules exist under current GAAP addressing the accounting for cloud service providers. But there is no explicit accounting guidance under GAAP about
SEC will scrutinize municipal advisers’ rules compliance
A new SEC examination initiative will scrutinize municipal advisers’ compliance with new rules and regulations that are under implementation. The SEC announced Tuesday that its Office of Compliance Inspections and Examinations (OCIE) will examine a significant percentage of municipal advisers for compliance. “The municipal adviser examination initiative will focus on
PCAOB requests comments on auditing accounting estimates and fair value measurements
The PCAOB is seeking input as it weighs possible standard-setting activities related to auditing accounting estimates and fair value measurements. In a staff consultation paper released Tuesday, the PCAOB Office of the Chief Auditor seeks comments on the potential need for changes to PCAOB standards—and a possible approach to a
FASB share-based payments standard challenges private companies
Although a review found that FASB’s share-based payments standard achieves its purpose, private company stakeholders told a post-implementation review team that the standard is sometimes difficult for them to understand and costly to apply. After analyzing the results of the Financial Accounting Foundation review of Statement 123(R), Share-Based Payment, released
IASB official: Global accounting standards are “achievable,” “inevitable”
The goal of global accounting standards will be achieved at some point, an International Accounting Standards Board (IASB) official said Wednesday in South Africa. Ian Mackintosh, vice-chairman of the IASB, called global accounting standards “desirable, achievable, and … inevitable” in a speech in Johannesburg. Although more than 100 countries have
Convergence unachieved after IASB publishes financial instruments standard
The International Accounting Standards Board (IASB) on Thursday issued a new financial instruments standard that introduces an expected-loss impairment model. But the standard falls short of the goal of convergence with financial instruments guidance being developed by FASB. IFRS 9, Financial Instruments, is the final element of the IASB’s response
Revenue transition group debates difficult implementation issues
A lively discussion by a new revenue recognition transition resource group gave FASB and the International Accounting Standards Board (IASB) plenty of views to consider as they ponder how to help preparers with implementation questions related to the revenue recognition standard issued in May. The resource group, which met for
FASB votes in favor of new consolidation standard
New accounting rules approved by FASB on Wednesday are designed to make financial reporting about consolidation more transparent and consistent. FASB will issue the standard in the coming months, following the drafting of the final Accounting Standards Update (ASU). All public and private companies that apply variable-interest entity (VIE) guidance
FASB proposals on inventory, extraordinary items seek simplification
FASB published proposals Tuesday that are designed to simplify the measurement of inventory and eliminate the concept of extraordinary items. The proposals are part of FASB’s simplification initiative, which is designed to reduce cost and complexity in financial reporting while improving or maintaining the usefulness of information to users through
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FROM THIS MONTH'S ISSUE
New AICPA chair pitches a people-first profession
New AICPA Chair Jan Lewis shares why listening and service are central to her leadership approach. From advocating for small firms to navigating AI and strengthening the talent pipeline, Lewis outlines how she plans to steward a profession built on trust, relevance, and opportunity.
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