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Accounting Research
Manager(TM)
Weekly Summary of
Developments
June 1-5, 2009
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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 Codification -- FASB Approves Codification
Going Concern -- FASB Discusses Going Concern Project
and Other Matters
EITF Materials -- FASB Issues Additional Materials for
June 18, 2009 EITF Meeting
Interactive Data -- SEC Staff Publishes New and Updated
Interpretations
PCAOB Inspections -- SEC Approves Amendments to PCAOB Rules
Relating to Inspections of Foreign Firms
Auditing and Internal
Controls Headlines
Audit Confirmations -- AICPA Proposes Guidance on External
Confirmations
PCAOB Inspections -- SEC Approves Amendments to PCAOB Rules
Relating to Inspections of Foreign Firms
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ACCOUNTING AND SEC HEADLINES:
=============================
FASB Codification -- FASB
Approves Codification
For detail, please contact info@zy-cpa.com
We have published a Hot Topic
that discusses the FASB’s approval of the FASB
Accounting Standards Codification™ (Codification) effective for financial
statements for interim or annual reporting periods ending after September 15,
2009. This means that a calendar year-end public entity should follow the
guidelines in the Codification beginning with its third quarter starting on
July 1, 2009. Once effective, the Codification becomes the
single source of authoritative
See our Hot Topic for
complete details.
Going Concern -- FASB
Discusses Going Concern Project and Other Matters
For detail, please contact info@zy-cpa.com
As reported in its “Summary
of Board Decisions” publication, the FASB met on June 3, 2009, and discussed
the following topics:
-Going concern;
-Proposed Statement 133
Implementation Issue (DIG) C22, “Exception Related to Embedded Credit
Derivatives;” and
-The Codification.
The FASB decided to broaden
the scope of its "going concern" project to address the following
additional areas at a future meeting:
-Enhancing the disclosures of
short-term and long-term risks, specifically risks for which there is
more-than-remote likelihood of occurrence;
-Defining "substantial
doubt" in terms of an entity’s ability to continue as a going concern; and
-Defining when it is
appropriate for an entity to apply the liquidation basis of accounting.
The FASB decided that the
time frame for the disclosures of short-term and long-term risks as well as the
assessment of an entity’s ability to continue as a going concern would be as
follows:
-Available information about
the foreseeable future, which is generally, but not limited to, 12 months from
the end of the reporting period;
-Certain events that are
expected to occur or are reasonably foreseeable beyond 12 months and would
materially affect the assessment are considered part of the foreseeable future;
and
-The time frame beyond 12
months is limited to a practical period of time thereafter in which significant
events or conditions that may affect the evaluation can be identified.
The FASB also approved
clarifications to proposed DIG Issue C22 which addresses the scope exception in
paragraph 14B of FASB Statement No. 133, Accounting for Derivative
Instruments and Hedging Activities, and indicates that the concentration of
credit risk that is only in the form of subordination of one financial
instrument to another should be considered an embedded derivative feature that
is not subject to the application of paragraphs 12 and 14A of Statement 133.
The FASB decided:
-The scope exception in
paragraph 14B should apply only to the credit derivative features that arise
between tranche holders of beneficial interests and
that are related to the credit loss allocation among the tranches
attributable to the subordination of one tranche to
another;
-To provide additional
guidance about the application of paragraphs 12, 13, and 14A of Statement 133
to the embedded derivative features in the examples in the proposed DIG Issue
C22; and
-To reexpose
the revised proposed DIG Issue C22 for a 45-day comment period and make the
effective date the first day of each reporting entity’s first fiscal quarter
beginning after December 15, 2009.
The FASB also approved the
Codification. See our discussion above on this topic.
EITF Materials -- FASB
Issues Additional Materials for June 18, 2009 EITF Meeting
For detail, please contact info@zy-cpa.com
The FASB issued the following
additional materials for the June 18, 2009 EITF meeting:
-Issue No. 08-9,
"Milestone Method of Revenue Recognition" (Issue Summary No. 1,
Supplement No. 2);
-Issue No. 09-1,
"Accounting for Own-Share Lending Arrangements in Contemplation of
Convertible Debt Issuance" (Issue Summary No. 1, Supplement No. 1);
-Issue No. 09-2,
"Research and Development Assets Acquired In an Asset Acquisition"
(Issue Summary No. 1, Supplement No. 1); and
-Issue No. 09-4 (formerly
09-F), "Seller Accounting for Contingent Consideration" (Issue
Summary No. 1).
Interactive Data -- SEC
Staff Publishes New and Updated Interpretations
For detail, please contact info@zy-cpa.com
The staff in the Division of
Corporation Finance (Corp Fin) of the SEC has issued the following two new
Compliance and Disclosure Interpretations (C&DIs):
-Interactive Data; and
-Regulation S-T.
These C&DIs
provide interpretations by Corp Fin, in a question and answer format, of the
SEC’s final rule, Interactive Data to Improve Financial Reporting (Final
Rule), and Regulation S-T. The Final Rule requires companies to provide
financial statements to the SEC and on their corporate websites in interactive
data format using eXtensible Business Reporting
Language. Among the topics covered in these two C&DIs
are:
-Final Rule 30-day grace
period;
-The requirements for separately
tagging specific items;
-Including an auditor’s
assurance report in an Interactive Data File; and
-Interactive data within the
scope of disclosure controls and procedures.
Corp Fin has also issued
updates to the following C&DIs to provide specific
interpretations associated with the Final Rule and its requirements on
interactive data:
-Exchange Act Sections;
-Exchange Act Rules;
and
-Exchange Act Forms.
In addition, the staff of
Corp Fin has issued updates to the C&DIs: (a)
Exchange Act Form 8-K; and (b) Regulation S-K. These
documents also provide interpretations by Corp Fin in a question and answer
format and have been updated to include topics, including persons disclosed in
the Summary Compensation Table and executive incentive plans.
See our Literature Update for
complete details.
PCAOB Inspections -- SEC
Approves Amendments to PCAOB Rules Relating to Inspections of Foreign Firms
For detail, please contact info@zy-cpa.com
The SEC has published, Public
Company Accounting Oversight Board; Order Approving Proposed Amendment to Board
Rules Relating to Inspections. This document includes amendments to PCAOB
Rule 4003, Frequency of Inspections. Specifically, these amendments add
a new paragraph (f) to provide that, with respect to any foreign registered
public accounting firm that under the PCAOB’s
inspection rules had a 2008 deadline for the first inspection, such deadline will
be extended to 2009.
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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Audit Confirmations --
AICPA Proposes Guidance on External Confirmations
For detail, please contact info@zy-cpa.com
The AICPA has issued for
public comment Proposed Statement on Auditing Standards (SAS), External
Confirmations, which would supersede SAS No. 67, The Confirmation
Process. This proposed SAS is not expected to change current practice in
any significant respect, but includes the following new items or guidance:
-New procedures required to
address the responsibilities of the auditor when management refuses to allow
the auditor to send a confirmation request;
-Added application material
to the proposed SAS regarding the use of oral responses to confirmation
requests as audit evidence; and
-The definition of external
confirmations has been changed to now include direct access by the auditor to
information held by a third party.
As proposed, the guidance in
this SAS would be effective for audits of financial statements for periods
beginning on or after December 15, 2010.
Comments on this proposed SAS
are due August 31, 2009.
PCAOB Inspections -- SEC
Approves Amendments to PCAOB Rules Relating to Inspections of Foreign Firms
For detail, please contact info@zy-cpa.com
As discussed above in our
Accounting and SEC Summaries, the SEC has published, Public Company
Accounting Oversight Board; Order Approving Proposed Amendment to Board Rules
Relating to Inspections. This document includes amendments to PCAOB Rule
4003, Frequency of Inspections. Specifically, these amendments add a new
paragraph (f) to provide that, with respect to any foreign registered public
accounting firm that under the PCAOB’s inspection
rules had a 2008 deadline for the first inspection, such deadline will be
extended to 2009.
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