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Accounting Research
Manager(TM)
Weekly Summary of
Developments
March 24-28, 2008
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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
EITF Decisions -- FASB Ratifies March 12, 2008 EITF
Decisions
Financial Assets and
Liabilities --
Interpretations of Statement 140 Published
Transfers of Financial
Assets -- FASB to Discuss
Derecognition Criteria Under Statement 140 and Other
Matters
International Financial
Reporting -- Q&A for
Foreign Private Issuers Published by the International Practices Task Force
Employee Benefits -- IASB Issues Discussion Paper on
Preliminary Views on Amendments to IAS 19
Auditing and Internal
Controls Headlines
Auditing Fair Value
Measurements and the Use of Specialists -- PCAOB Interpretive Guidance Discussed
Government Headlines
Fund Balance Accounting -- GASB Exposure Draft on Fund Balance
Reporting and Governmental Funds Definitions Discussed
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ACCOUNTING AND SEC HEADLINES:
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EITF Decisions -- FASB
Ratifies March 12, 2008 EITF Decisions
For detail, please contact info@zy-cpa.com
We have prepared a Hot Topic
that discusses the FASB's ratification of decisions
made by the EITF at its March 12, 2008 meeting. Specifically, the FASB ratified
the final consensus reached in EITF Issue No. 07-4, "Application of the
Two-Class Method under FASB Statement No. 128, Earnings per Share, to
Master Limited Partnerships." In addition, the FASB ratified the following
consensuses-for-exposure:
-EITF Issue No. 07-5,
"Determining Whether an Instrument (or Embedded Feature) Is Indexed to an
Entity's Own Stock";
-EITF Issue No. 08-3,
"Accounting by Lessees for Nonrefundable Maintenance Deposits"; and
-EITF Issue No. 08-4,
"Transition Guidance for Conforming Changes to Issue No. 98-5, 'Accounting
for Convertible Securities with Beneficial Conversion Features or Contingently
Adjustable Conversion Ratios.'"
Issue 08-4 was discussed at
the EITF's March 12, 2008 meeting in the context of
potential revisions to Issue 98-5 as a result of the guidance in EITF Issue No.
00-27, "Application of EITF Issue No. 98-5, 'Accounting for Convertible
Securities with Beneficial Conversion Features or Contingently Adjustable
Conversion Ratios,' to Certain Convertible Instruments," and FASB
Statement No. 150, Accounting for Certain Financial Instruments with
Characteristics of both Liabilities and Equity. However, it was not
assigned an issue number when the EITF discussed the merits of the revisions
until this FASB ratification-for-exposure process. The FASB staff developed
this issue as a means to expose the transition guidance for the conforming
changes agreed to by the EITF without exposing Issue 98-5, as amended, in its
entirety.
See our Hot Topic for
complete details.
Financial Assets and
Liabilities -- Interpretations of Statement 140 Published
For detail, please contact info@zy-cpa.com
We have published a Literature Update
discussing an update to our publication, Financial Assets and Liabilities -
Sales, Transfers, and Extinguishments: Interpretations of FASB Statement 140. Specific
updates include the following:
-Updated Interpretation 1-3,
"Effect of Statement 157 on Statement 140," to reflect the FASB's deferral of certain portions of that pronouncement
through the issuance of FASB Staff Position (FSP) FAS 157-2, Effective Date
of FASB Statement No. 157.
-Revised the "Recent
Developments" section for recent deliberations at the FASB on a variety of
relevant projects.
-Incorporated comments by the
SEC staff at the 2007 AICPA National Conference on Current SEC and PCAOB
Developments, including guidance on: (a) measurement of loans
receivable; (b) impairments of financial assets; and (c) defaults
that are reasonably foreseeable for certain subprime
adjustable rate mortgages.
-Updated certain
cross-references to reflect the issuance of FASB Statement No. 141 (Revised
2007), Business Combinations.
See our Literature Update for
complete details.
Transfers of Financial
Assets -- FASB to Discuss Derecognition Criteria
Under Statement 140 and Other Matters
For detail, please contact info@zy-cpa.com
As reported in its
"Action Alert" publication, the FASB is scheduled to meet on April 2,
2008 to discuss proposed amendments to the derecognition
criteria in paragraph 9 of FASB Statement No. 140, Accounting for Transfers
and Servicing of Financial Assets and Extinguishments of Liabilities. The
FASB will discuss whether to eliminate the accounting significance of
qualifying special-purpose entities.
As also indicated in its
Action Alert publication, the FASB met on March 19, 2008 and discussed comments
received on FASB Staff Position (FSP) FAS 142-f, Determination of the Useful
Life of Intangible Assets. The FASB decided that the final version of this
FSP should:
-Include two examples to
illustrate the principles in the FSP.
-Reinforce the existing
disclosure requirements of AICPA Statement of Position (SOP) 94-6, Disclosure
of Certain Significant Risks and Uncertainties.
-Apply prospectively the
provisions on determining useful life to intangible assets acquired after the
effective date. The disclosure requirements of the final FSP should be applied
prospectively to intangible assets recognized as of and subsequent to the
effective date.
-Only include disclosures of:
(a) the weighted-average period prior to the next renewal or extension;
(b) the entity's accounting policy on the treatment of costs incurred to
renew or extend the term of a recognized intangible asset; and (c) the
amount of costs incurred to renew or extend the term of a recognized intangible
asset that have been capitalized into the carrying amount of a recognized
intangible asset.
As proposed, the FSP would be
effective for financial statements issued for fiscal years beginning after
December 15, 2008, and interim periods within those fiscal years.
International Financial
Reporting -- Q&A for Foreign Private Issuers Published by the International
Practices Task Force
For detail, please contact info@zy-cpa.com
The AICPA's
SEC International Practices Task Force has published highlights of its March 4,
2008 teleconference. The meeting highlights include a question and answer
(Q&A) implementation document for Foreign Private Issuers (FPIs) on the SEC's final rule, Acceptance from Foreign
Private Issuers of Financial Statements Prepared in Accordance with IFRS
Without Reconciliation to U.S. GAAP. The final rule allows FPIs to file financial statements with the SEC prepared in
accordance with IFRS as issued by the IASB without reconciliation to U.S. GAAP.
Topics covered in the Q&A are:
-Compliance date and
transition;
-Unreserved and explicit
statement of compliance with IFRS as issued by the IASB;
-Auditors' report;
-The effect of the release on
the application of Rules 3-05 and 3-09 of Regulation S-X;
-Selected financial data;
-Pro forma financial
information;
-Applicability to Form 10-K
filers;
-FPI voluntarily provides a
U.S. GAAP reconciliation in its Form 20-F;
-First time adopters of IFRS;
-Industry guides; and
-Three years of financial
statements.
Employee Benefits -- IASB
Issues Discussion Paper on Preliminary Views on Amendments to IAS 19
For detail, please contact info@zy-cpa.com
The IASB has issued for
public comment a Discussion Paper (DP), Preliminary Views on Amendments to
IAS 19 Employee Benefits. The DP provides the preliminary views of the IASB
on amendments to IAS 19, Employee Benefits. The DP discusses the
following topics or items:
-Elimination of the deferred
recognition and smoothing features of IAS 19, which would require all changes
in the value of plan assets and in the post-employment benefit obligation to be
recognized in the period they occur.
-Possible approaches to
presenting the impact of immediate recognition of all changes in defined
benefit obligations.
-Defining a new category of
obligations-contribution-based obligations-and measuring them at fair value
assuming the terms of the benefit promise do not change.
-The option to receive the
higher of a defined benefit or contribution-based promise should be separately
recognized and measured at fair value assuming the terms of the benefit promise
do not change.
Comments on the DP are due
September 26, 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
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AUDITING AND INTERNAL CONTROLS
HEADLINES:
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Auditing Fair Value
Measurements and the Use of Specialists -- PCAOB Interpretive Guidance
Discussed
For detail, please contact info@zy-cpa.com
We have added a GAAS Update
Service that provides discussion and analysis of PCAOB Staff Audit Practice
Alert No. 2, Matters Related to Auditing Fair Value Measurements of
Financial Instruments and the Use of Specialists. The Practice Alert was
issued in light of the impending effective date of FASB Statement No. 157, Fair
Value Measurements, as well as the significantly increased audit risk and
challenges related to valuation of financial instruments brought about by the
liquidity crisis in the capital markets, which began in early 2007. The
Practice Alert discusses the following key topics:
-Auditing fair value
measurements, including the classification of fair value measurements within
the fair value hierarchy established by Statement 157;
-The use of specialists in
fair value measurements; and
-The use of pricing services
in fair value measurements.
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
======================
GOVERNMENT HEADLINES:
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Fund Balance Accounting --
GASB Exposure Draft on Fund Balance Reporting and Governmental Funds Definitions
Discussed
For detail, please contact info@zy-cpa.com
We have added a Governmental
GAAP Update Service that is the first of a two part series on the GASB proposed
Exposure Draft (ED), Fund Balance Reporting and Governmental Fund Type
Definitions. The ED seeks to enhance the usefulness of fund balance
information by: (a) providing clearer fund balance classifications that
can be more consistently applied; and (b) clarifying the existing
governmental fund type definitions. The Update Service discusses the
classification of fund balances (e.g., nonspendable
fund balance, spendable fund balance, restricted fund balance) and the illustrated classification
of fund balances included in the ED.
As proposed, the ED would be
effective for financial statements for periods beginning after June 15, 2010.
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