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Accounting Research Manager(TM)
Weekly Summary of Developments
March 5-9, 2007
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Accounting Research Manager subscriber,
The Accounting Research Manager database now contains this week's weekly summary of developments. Click the link below to access and print the fully-formatted Weekly Summary:
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If you do not have immediate Internet access to the Accounting Research Manager database, below is the text of this week's Weekly Summary.
Accounting and SEC Headlines
Financial Assets and Liabilities -- Guidance Revised and Added in Our Interpretations of FASB Statement 140
EITF Materials Issued -- Convertible Debt Instruments Comment Letter for the March 15, 2007 EITF Meeting
Business Combinations -- FASB Continues Redeliberations at February 28, 2007 Meeting
Securities Industry Developments -- AICPA Issues Audit Risk Alert
International Financial Reporting -- IASB Issues Agenda for International Financial Reporting Interpretations Committee (IFRIC) Meeting on March 7-9, 2007
Auditing Headlines
Compilations and Reviews -- Proposed Statement on Standards for Accounting and Review Services
Securities Industry Developments -- AICPA Issues Audit Risk Alert
Government Headlines
Technical Plan -- Discussion of GASB Technical Plan
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ACCOUNTING AND SEC HEADLINES:
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Financial Assets and Liabilities -- Guidance Revised and Added in Our Interpretations of FASB Statement 140
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We have revised and updated the interpretations in our publication, Financial Assets and Liabilities - Sales, Transfers, and Extinguishments: Interpretations of FASB Statement 140. Among the revisions in this update, various changes were made to reflect the issuance of the SEC staff's Current Issues and Rulemaking Projects (CIRP), "Current Accounting and Disclosure Issues in the Division of Corporation Finance," dated November 30, 2006.
We also added Interpretation 4-10a, "Arrangements Involving Transfers of Rights to Future Cash Flows From Potential Sales," to reflect the SEC staff's comments that the transfer of rights to future cash flows from potential sales is not within Statement 140's scope. Those comments were made at the 2006 AICPA National Conference on Current SEC and PCAOB Developments. We also updated Interpretation 14-3, "Determining Whether Financial Assets That Would Be Subject to Paragraph 14 of Statement 140 Are Subject to Statement 133," to reflect the issuance of Question B40, "Embedded Derivatives: Application of Paragraph 13(b) to Securitized Interests in Prepayable Financial Assets," in the FASB Staff Implementation Guide, A Guide to Implementation of Statement 133 on Accounting for Derivative Instruments and Hedging Activities. That guidance cites conditions under which a securitized interest in prepayable financial assets would not be subject to bifurcation.
EITF Materials Issued -- Convertible Debt Instruments Comment Letter for the March 15, 2007 EITF Meeting
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The FASB has issued the following materials for the EITF meeting scheduled for March 15, 2007:
-Issue No. 07-2, "Accounting for Convertible Debt Instruments That Require or Permit Partial Cash Settlement upon Conversion" (Comment Letter)
Business Combinations -- FASB Continues Redeliberations at February 28, 2007 Meeting
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As reported in its "Action Alert" publication, the FASB met on February 28, 2007, and addressed the following projects or topics:
-Conceptual Framework
-Business Combinations: Applying the Acquisition Method
The FASB made several decisions at this meeting relating to how enterprises should apply the acquisition method in a business combination. Some decisions affirmed what was reflected in the June 30, 2005 Exposure Drafts, Business Combinations, and Consolidated Financial Statements, Including Accounting and Reporting of Noncontrolling Interests in Subsidiaries, whereas the FASB modified other views. For example, the FASB affirmed that an acquirer should measure and recognize an asset leased to others through an operating lease at its acquisition date fair value without considering the terms of the operating lease. That is, the acquirer should recognize the favorable (unfavorable) portion of an operating lease separately as an intangible asset (liability).
The Action Alert also notes that the following projects or topics are scheduled to be discussed by the FASB at its March 14, 2007 meeting:
-Transfers of Financial Assets
-Agenda Decision: Valuation of Commodity Inventory
-Statement 133 Implementation Issue - Convertible Debt with Elements of Foreign Exchange Risk
Securities Industry Developments -- AICPA Issues Audit Risk Alert
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The AICPA has issued an Audit Risk Alert, Securities Industry Developments - 2006/2007. This Audit Risk Alert may be useful to preparers and auditors of financial statements of broker-dealers in securities. The Alert provides an overview of recent economic, industry, regulatory, and professional developments that may affect broker-dealers. Because securities broker-dealers often deal in commodity futures or function as commodity pool operators, this Alert expands the discussion of recent developments to include matters that may affect the audits of commodity entities as well.
International Financial Reporting -- IASB Issues Agenda for International Financial Reporting Interpretations Committee (IFRIC) Meeting on March 7-9, 2007
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The IASB has issued the agenda for the IFRIC March 7-9, 2007, meeting which includes:
-IAS 39 Financial Instruments: Recognition and Measurement
-IAS 18 Revenue
-D20 Customer Loyalty Programs
-IFRS 5 Non-current Assets held for Sale and Discontinued Operations
-D19 IAS 19 - The Asset Ceiling: Availability of Economic Benefits and Minimum Funding Requirements
-IAS 38 Intangibles
-IAS 21 The Effects of Changes in Foreign Exchange Rates
-Review of Tentative Agenda Decisions published in January IFRIC Update
-IAS 19 Employee Benefits
-IFRS 3 Business Combinations
-IAS 1 Presentation of Financial Statements/ IAS 39 Financial Instruments: Recognition and Measurement
-IAS 16 Property, Plant and Equipment
Among the topics scheduled to be addressed by the IFRIC is whether it should provide guidance on the accounting for bets or wagers received by a gaming institution. Specifically, the issue is whether such transactions give rise to revenue or whether unsettled wagers are financial instruments which should be accounted for using IAS 39.
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AUDITING HEADLINES:
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Compilations and Reviews -- Proposed Statement on Standards for Accounting and Review Services
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We have added a GAAS Update Service that provides discussion and analysis of a proposed Statement on Standards for Accounting and Review Services (SSARS) entitled, Elimination of Certain References to Statements on Auditing Standards and Incorporation of Appropriate Guidance into Statements on Standards for Accounting and Review Services. The proposed Statement eliminates references to auditing literature from SSARSs and, where deemed appropriate, similar guidance will be incorporated into the SSARSs. The more significant provisions of the proposed Statement address: (a) emphasis-of-matter paragraphs in compilation and review reports; (b) subsequent discovery of facts existing at date of the accountant's report; and (c) financial statement titles under generally accepted accounting principles or an other comprehensive basis of accounting. The proposed Statement would be effective for compilations and reviews of financial statements for periods ending on or after December 15, 2007.
Securities Industry Developments -- AICPA Issues Audit Risk Alert
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As discussed above in our Accounting and SEC Summaries, the AICPA has issued an Audit Risk Alert, Securities Industry Developments - 2006/2007. This Audit Risk Alert may be useful to preparers and auditors of financial statements of broker-dealers in securities. The Alert provides an overview of recent economic, industry, regulatory, and professional developments that may affect broker-dealers. Because securities broker-dealers often deal in commodity futures or function as commodity pool operators, this Alert expands the discussion of recent developments to include matters that may affect the audits of commodity entities as well.
Some of the documents listed above may not be accessible under your current subscription. For information about upgrading your subscription to include additional content, click here:
For detail, please contact info@zy-cpa.com
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GOVERNMENT HEADLINES:
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Technical Plan-- Discussion of GASB Technical Plan
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We have added a Governmental GAAP Update Service that summarizes and discusses the GASB's technical plan for the period ending April 30,2007. For example, the GASB has a project on its agenda to assess whether existing reporting requirements related to fund balance reporting adequately meet the needs of financial statement users. Specifically, in October 2006, an Invitation to Comment (ITC) was issued seeking input from constituents about the proposed clarifications to the fund type definitions and the fund balance display alternatives. The comment period ended on January 31, 2007. A user roundtable was also scheduled for February 2007. Re-deliberations of topics covered in the ITC began at the GASB's February 2007 meeting. An exposure draft is expected to be issued in the second quarter of 2007 and a final standard is expected by the first quarter of 2008.
Some of the documents listed above may not be accessible under your current subscription. For information about upgrading your subscription to include additional content, click here:
For detail, please contact info@zy-cpa.com