EXECUTIVE SUMMARY PROTECTING THE PRIVACY of personal information is no longer optional for organizations that collect, use and distribute it. Federal law now requires entities to take responsibility for safeguarding the data they gather from customers and patients. ORGANIZATIONS THAT ACCEPT AND FULFILL their privacy-related obligations will find it easier
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TOPICS / TECHNOLOGY
Information security & privacy
Smart Stops on the Web
SMART STOPS ON THE WEB IT Lessons and Links www.toejumper.net Dedicated to offering troubleshooting guidance, this Web site provides information on crashproofing and maintaining PCs, as well as speeding up computer functions. CPAs also can link to search engines, business advice, new product information and Toejumper’s newsletter archives. Tune It.
Accounting
AcSEC, the AICPA accounting standards executive committee, in agreement with FASB and the SEC, rescinds SOP 92-3, Accounting for Foreclosed Assets. FASB statement no. 144, Accounting for the Impairment or Disposal of Long-Lived Assets, effectively superseded the SOP, the scope of which did not include non-long-lived assets such as inventories
Privacy
A new Federal Trade Commission publication, Financial Institutions and Customer Data: Complying with the Safeguard Rule ( www.ftc.gov/bcp/conline/pubs/buspubs/safeguards.htm ), explains important aspects of the regulation ( www.ftc.gov/privacy/glbact ), which applies to businesses “significantly engaged” in providing financial products or services to consumers. The report includes a section called “How to
Retirement
The IRS releases 2003 cost-of-living adjustments related to benefit and contribution limits for qualified retirement plans ( www.irs.gov/pub/irs-news/ir02-111.pdf ). Many such savings caps are not changing this year because the increase in the cost-of-living index fell below the statutory thresholds that otherwise would trigger their adjustment. However, several will increase
Auditing
The ASB issues Statement on Auditing Standards no. 100, Interim Financial Information, replacing SAS no. 71, with the same title. The new standard provides additional guidance on performing reviews of interim financial information and incorporates the SEC’s requirement for timely filing of interim data. It also includes recommendations from the
FYI
Four practitioners replace departing members of the ASB. The appointees are Kenneth Macias, William F. Messier Jr., Steven L. Schenbeck and Michael T. Umscheid.
International
The International Accounting Standards Board (IASB) issues an exposure draft, Share-based Payment ( www.iasb.org.uk ), which proposes companies, on their financial statements, report as expenses any shares or options they grant to employees as compensation. The IASB concluded that such transactions are not different from those in which an entity
Privacy Framework Helps CPAs Protect Consumers
EXECUTIVE SUMMARY COMPANIES REQUIRE HELP understanding and complying with the confusing array of privacy rules, and CPAs can meet that need. HIGHLY PUBLICIZED CORPORATE FAILURES to protect confidential data have heightened consumers’ awareness of threats to their privacy. CONSUMERS SURVEYED SAID they would rather do business with companies that
Accounting
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. Testifying before the House Financial Services Committee on behalf of the profession, AICPA President and CEO Barry C. Melancon backs reforms—including
Securities
The GAO releases the results of a study ( www.gao.gov/cgi-bin/getrpt?GAO-02-302 ) it recently conducted to determine whether the SEC’s logistic capabilities are keeping pace with the rapid increase in filings, applications and examinations that make up its workload. While the GAO praised the commission’s record of achievement, it nevertheless found
Privacy
Most consumers worry that corporations mishandle their personal information, says a Harris Interactive survey the AICPA and Ernst & Young LLP jointly commissioned to help practitioners better understand privacy risks their clients and employers face. Eighty-four percent of respondents supported requiring companies to obtain independent verification they follow their stated
Government Accounting
The Federal Accounting Standards Advisory Board requests comments on the following exposure drafts ( www.fasab.gov/exposure.htm ): Elimination of the Category National Defense Property, Plant and Equipment (responses due by May 20), Target Audience and Qualitative Characteristics for the Consolidated Financial Report of the United States Government (responses due by June
Banking
The Treasury Department’s Office of Thrift Supervision (OTS) advises savings associations to consult it before they consider transferring to an external entity their high-risk assets—such as nonperforming loans—when the bank retains significant credit risk related to those assets and simultaneously provides considerable funding to the receiving entity ( www.ots.treas.gov/docs/25156.pdf ).
FYI
James M. Williams, a senior partner at Ernst & Young LLP, will begin a five-year term as a member of GASB, effective July 1. He succeeds Edward M. Klasny, who departs the board after 10 years of service. Williams was a member of the AICPA government accounting and auditing committee
Accounting
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 Institute’s accounting standards staff releases two technical practice aids. One provides guidance on reporting financial highlights by separate accounts (
Privacy
Several federal financial regulators jointly issue a guide to help consumers make informed decisions about choices they face as a result of the privacy provisions of the Graham-Leach-Bliley Act of 1999, which loosened restrictions on banks, insurers and other financial institutions’ sharing of marketing information about their customers. The guide,
Tax
The IRS should improve communications between its senior managers and field employees about its reorganization and customer service operations, the AICPA testified before the Internal Revenue Service Oversight Board in January. The Institute praised certain recent IRS initiatives, such as the large and midsize business division’s Fast Track dispute resolution
Government Accounting
The secretary of the Treasury, the director of the Office of Management and Budget and the comptroller general of the United States restructured the Federal Accounting Standards Advisory Board in January to increase the number of public members to six from three, decrease the number of federal government members to
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