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Accounting Research Manager(TM)
Weekly Summary of Developments
September 17-21, 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
FASB Report Issued -- Business Combinations and Other Matters
Derivative Disclosures -- FASB to Discuss Derivative Disclosures Exposure Draft and Other Matters at September 26, 2007 Meeting
Financial Statement Presentation -- Interpretation Updated
Statement of Cash Flows -- SEC Practice Guidance Updated and Expanded
SEC EDGAR Filings -- SEC Issues Guidance to EDGAR Filers
AcSEC Meeting Minutes -- AcSEC Discusses Casino Guide and Considers Other Matters at September 18-19, 2007 Meeting
International Financial Reporting -- IFRIC Discusses Revenue From Customer Contributions and Other Matters at September 6-7, 2007 Meeting
Auditing and Internal Controls Headlines
Internal Controls -- Document Issued Discussing Guidance on Monitoring Internal Control Systems
Government Headlines
GASB Report Issued -- Comments on Derivatives Proposal Sought
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ACCOUNTING AND SEC HEADLINES:
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FASB Report Issued -- Business Combinations and Other Matters
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The July edition of the "FASB Report" includes a discussion of the decisions reached and projects added by the FASB during the three-month period ended June 30, 2007. As of July 1, 2007, the FASB has the following projects on its active agenda:
Joint Projects with the IASB--
-Conceptual Framework
-Business Combinations
-Financial Instruments: Liabilities and Equity
-Financial Statement Presentation
-Leases
-Revenue Recognition
-Earnings per Share
-Income Taxes
-Research and Development
-Insurance Contracts
-Financial Instruments
FASB Only Projects--
-Mergers and Acquisitions by a Not-for-Profit Organization
-Postretirement Benefit Obligations Including Pensions
-Derivatives Disclosures
-Fair Value Option (Phase 2)
-Financial Guarantee Insurance
-Insurance Risk Transfer
-Loan Disclosures
-Statement 133 Hedging
-Statement 140 Implementation
-Emission Allowances
-GAAP Hierarchy
-Going Concern and Liquidation Basis of Accounting
-Subsequent Events
-Various FASB Staff Positions
-XBRL
-Codification
In addition, the FASB Report includes a Q&A with FASB board member Lawrence W. Smith.
Derivative Disclosures -- FASB to Discuss Derivative Disclosures Exposure Draft and Other Matters at September 26, 2007 Meeting
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As reported in its "Action Alert" publication, the FASB is expected to meet on September 26, 2007, to discuss the following issues:
-Derivative disclosures;
-Whether to add a project to its agenda to address the interaction between FASB Statement No. 13, Accounting for Leases, and FASB Statement No. 157, Fair Value Measurements;
-FASB ratification of EITF consensus and tentative conclusions (reached at the EITF's September 11, 2007 meeting);
The FASB will continue its redeliberations of its Exposure Draft, Disclosures about Derivative Instruments and Hedging Activities. Specifically, the FASB will discuss: (a)requirements for tabular presentation of information about derivative fair values; (b)gains and losses on derivatives; and (c)gains and losses on hedged items in designated and qualifying hedging relationships.
Financial Statement Presentation -- Interpretation Updated
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We have revised our publication, Financial Statement Presentation, to reflect the following items:
-The "General Considerations" section was updated to reflect guidance in FASB Statement No. 154, Accounting Changes and Error Corrections - A replacement of APB Opinion No. 20 and FASB Statement No. 3; and
-A new section entitled, "Cash Flow Statement" was added to incorporate existing guidance in FASB Statement No. 95, Statement of Cash Flows, as amended, including the requirements in FASB Statement No. 159, The Fair Value Option for Financial Assets and Financial Liabilities - Including an Amendment of FASB Statement No. 115.
We will add new interpretations and update existing guidance as developments occur.
Statement of Cash Flows -- SEC Practice Guidance Updated and Expanded
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We have updated and expanded, Statement of Cash Flows, within Chapter 10 of SEC Practice. Chapter 10 of SEC Practice consolidates views expressed by the SEC Staff on a specific accounting topic or area. The SEC Staff provides its views via a number of avenues including speeches, specific accounting and disclosure publications, joint meetings with the AICPA's SEC Regulations Committee and Staff Accounting Bulletins. Among the topics covered within this expanded section of Chapter 10 are the following:
-Direct vs. indirect method of presenting cash flows;
-Classification of different types of cash flows;
-Presenting cash flows associated with discontinued operations;
-Gross vs. net presentation of cash flows;
-Classifying cash received from insurance proceeds;
-Cash flows associated with inventory sales financing arrangements;
-Presentation of cash flows associated with loans and trade receivables; and
-Presentation and disclosure of non-cash expenses.
We have also added the guidance provided by the SEC Staff that auction rate securities do not meet the definition of a cash equivalent. See our Literature Update for complete details.
SEC EDGAR Filings -- SEC Issues Guidance to EDGAR Filers
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The SEC's Division of Corporation Finance issued guidance for registrants submitting filings using the Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system. The guidance is aimed at making the EDGAR filing process more efficient and does not change any existing rules or create new ones. Topics covered in the guidance are:
-Updating filer information;
-Maintaining control of filer access codes (Central Index Key, CIK Confirmation Code, password, etc);
-Filing date adjustments;
-Correcting errors in EDGAR filings;
-Requests for withdrawal of Securities Act filings;
-Filing deletions; and
-Continuing hardship exemptions.
See our Literature Update for complete details.
AcSEC Meeting Minutes -- AcSEC Discusses Casino Guide and Considers Other Matters at September 18-19, 2007 Meeting
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We have prepared minutes of the AcSEC meeting held on September 18-19, 2007. At this meeting, AcSEC considered the following matters or topics:
-Revisions to the Audit and Accounting Guide (AAG), Audits of Casinos;
-Revisions to the AAG, Heath Care Organizations;
-Revisions to the AAG, Not-for-Profit Organizations;
-Statement of Position 07-1, Implementation Guidance, Real Estate Investment Funds;
-Education Session, IASB Discussion Paper, Preliminary Views on Insurance Contracts; and
-Other information, "Chair's Report."
See our minutes for complete details.
International Financial Reporting -- IFRIC Discusses Revenue From Customer Contributions and Other Matters at September 6-7, 2007 Meeting
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As reported in the IASB's "IFRIC Update" publication, the IFRIC met on September 6-7, 2007, and discussed the following matters:
-IAS 18 Revenue - Customer contributions
-IAS 27 Consolidated and Separate Financial Statements - Non-cash distributions
-IFRS 2 Share-based Payment - Group cash-settled share-based payment transactions
-IAS 39 Financial Instruments: Recognition and Measurement - Paragraph AG33(d)(iii) and Scope of paragraph 11A
-IFRIC Agenda Decisions
-Tentative Agenda Decisions
-IFRIC Work in Progress
The IFRIC continued its deliberations on how a service provider entity should account for the receipt of customer provided assets (including cash) that are used by the provider to deliver services to the customer. To date, the IFRIC has tentatively concluded the following regarding customer contributions:
-An entity receiving customer contributions should first assess whether it has received an asset that meets the recognition criteria in IFRS;
-Entities receiving customer contributions should assess whether the related service arrangement contains a lease;
-Customer contributions should be initially recognized at fair value, with the related credit recorded as a liability taken to income as access to services are given;
-The receipt of a cash contribution should be accounted for in the same way as the receipt of an item of property since both produce substantially similar economic effects;
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AUDITING AND INTERNAL CONTROLS HEADLINES:
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Internal Controls -- Document Issued Discussing Guidance on Monitoring Internal Control Systems
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The Committee of Sponsoring Organizations of the Treadway Commission (COSO) has issued a Discussion Document (DD), Internal Control - Integrated Framework -- Guidance on Monitoring Internal Control Systems. The DD represents the first phase of a larger project aimed at improving the understanding and utilization of the monitoring component of COSO's Integrated Framework. Topics in the DD include:
-Role of monitoring;
-Structure of effective internal control systems;
-Differences between monitoring activities and control activities;
-Fundamentals of monitoring;
-Nature of information used in monitoring;
-Designing effective monitoring; and
-Scalability of monitoring.
The second phase of this monitoring project will be the publication of examples, case studies, and tools to assist all organizations in implementing effective and efficient monitoring. Comments on this proposal are due October 31, 2007.
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GOVERNMENT HEADLINES:
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GASB Report Issued -- Comments on Derivatives Proposal Sought
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The August edition of the "GASB Report" has been issued and includes the following discussion items:
-GASB Calendar
-Comments Sought on Derivatives Proposal
-Board Meeting Summary
-GASB Current Technical Agenda
-Board Approves Technical Plan for the Final Four Months of 2007
-Current Agenda Projects
-Who’s Who at the GASB
As discussed more completely in the GASB Report, the GASB is seeking comments on its Exposure Draft (ED), Accounting and Financial Reporting for Derivative Instruments. The ED addresses recognition and measurement of derivative instruments and would require disclosure of additional information regarding such instruments in the financial statements of state and local governments. In addition, the ED includes proposed methods and illustrations of evaluating hedge effectiveness. If approved as proposed, the provisions of the ED would be effective for financial statements for periods beginning after June 15, 2009. Earlier application would be encouraged. Comments on the ED are due October 26, 2007.
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:
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