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Accounting Research
Manager(TM)
Weekly Summary of
Developments
September 21-25, 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:
For detail, please contact info@zy-cpa.com
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 Ratifies September 9-10, 2009
EITF Decisions and Discusses Other Matters
FASB Meeting -- FASB Ratifies September 9-10, 2009
EITF Decisions and Discusses Other Matters
PCAOB Report -- PCAOB Publishes Report on First Year
of Implementation of Auditing Standard No. 5
Financial Statements -- FASB Discusses Financial Statement
Presentation Project
Auditing and Internal
Controls Headlines
Financial Institutions -- New Edition of Knowledge-Based Audits
Published
Compilation and Review
Engagements -- Discussion
and Analysis of AICPA Proposals
PCAOB Report -- PCAOB Publishes Report on First Year
of Implementation of Auditing Standard No. 5
Government Headlines
Stabilization Arrangements -- Reporting Implications of Stabilization
Arrangements and Minimum Fund Balance Policies Discussed
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ACCOUNTING AND SEC HEADLINES:
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FASB Codification -- FASB
Ratifies September 9-10, 2009 EITF Decisions and Discusses Other Matters
The FASB has published the
following amendments to the FASB Accounting Standards CodificationTM:
-FASB Accounting Standards
Update 2009-10, Financial Services-Broker and Dealers: Investments-Other-Amendment
to Subtopic 940-325; and
For detail, please contact info@zy-cpa.com
-FASB Accounting Standards
Update 2009-11, Extractive Activities-Oil and Gas-Amendments to Section
932-10-S99.
For detail, please contact info@zy-cpa.com
FASB Accounting Standards Update
2009-10 codifies the SEC Observer comment in paragraph 17 of EITF Issue No.
02-3, "Issues Involved in Accounting for Derivative Contracts Held for
Trading Purposes and Contracts Involved in Energy Trading and Risk
Management." FASB Accounting Standards Update 2009-11 includes a technical
correction to the SEC Observer comment in EITF Issue No. 90-22,
"Accounting for Gas-Balancing Arrangements."
FASB Meeting -- FASB
Ratifies September 9-10, 2009 EITF Decisions and Discusses Other Matters
For detail, please contact info@zy-cpa.com
As reported in its
"Summary of Board Decisions" publication, the FASB met on September
23, 2009, and discussed the following topics:
-FASB ratification of
September 9-10, 2009 EITF decisions;
-Financial statement
presentation;
-Revenue recognition; and
-Accounting for financial
instruments.
The FASB ratified decisions
made by the EITF at its meeting held on September 9-10, 2009. Specifically, the
FASB ratified the consensuses reached in EITF Issue No. 08-1, "Revenue
Arrangements with Multiple Deliverables" and EITF Issue No. 09-3, “Certain
Revenue Arrangements That Include Software Elements.” In addition, the FASB
ratified the decisions reached in:
-EITF Issue No. 09-2,
"Research and Development Assets Acquired In an Asset Acquisition";
-EITF Issue No. 09-B,
"Consideration of an Insurer’s Accounting for Majority-Owned Investments
When Ownership Is through a Separate Account"; and
-EITF Issue No. 09-E,
"Accounting for Stock Dividends, Including Distributions to Shareholders
with Components of Stock and Cash."
For additional information on
these decisions, consult our EITF Flash Report. The FASB plans to publish these
ratified consensuses in the form of a FASB Accounting Standards Update.
The FASB began deliberating
the proposals in its Discussion Paper (DP), Preliminary Views on Financial
Statement Presentation, and made the following decisions:
-An entity would be required
to present financial statement items in sections that distinguish between
business activities (value creating activities) and financing activities
(funding of that value creation) in each of the financial statements.
-The FASB will be more
specific in defining the financing section that is expected to include at least
two components: (1) treasury assets; and (2) financing liabilities.
-To retain an approach to
classification within the business section that is based on how a reporting entity
organizes its activities and how it uses its assets and liabilities.
-There will not be an
operating or investing category within the business section, but rather
additional groupings of information within the business section (i.e.,
categories) would reflect the facts and circumstances of that entity and would
be left to management’s discretion.
-An entity will be required
to present information about discontinued operations in a separate section in
each of its primary financial statements (except the statement of changes in
equity).
-An entity would not be
required to present information about net debt in its financial statements.
The FASB discussed the
following revenue recognition topics: (a) the relationship between the
proposed model and receivables accounting; (b) the definition of control
for determining when goods and services are transferred to a customer; and (c)
options to acquire additional goods and services. See the "Summary of
Board Decisions" publication for complete details of decisions made on
these topics by the FASB.
The FASB also discussed the
accounting for financial instruments and agreed to a remeasurement
approach that has the following characteristics:
-A present value of the
average core deposit liability amount discounted by the difference between the
alternative funds rate and the all-in-cost-to-service rate over the implied
maturity.
-The core deposit liability
amount that would be subject to the remeasurement
would be determined as an average amount over the implied maturity time period,
which would result in the consideration of future deposits. Considering and
valuing future deposits would result in an intangible asset being reflected in
the valuation.
PCAOB Report -- PCAOB
Publishes Report on First Year of Implementation of Auditing Standard No. 5
For detail, please contact info@zy-cpa.com
The PCAOB has published a
report, Report on the First-Year Implementation of Auditing Standard No. 5,
An Audit of Internal Control Over Financial Reporting That Is Integrated with
An Audit of Financial Statements. This report describes the most common or
noteworthy observations that were found from inspections conducted during 2008
regarding registered audit firms' first year implementation of PCAOB Auditing
Standard No. 5, An Audit of Internal Control Over Financial Reporting That
is Integrated with An Audit of Financial Statements, which became effective
for audits for fiscal years ending on or after Nov. 15, 2007, and replaced
PCAOB Auditing Standard No. 2, An Audit of Internal Control Over Financial
Reporting Performed in Conjunction With an Audit of Financial Statements.
Financial Statements --
FASB Discusses Financial Statement Presentation Project
For detail, please contact info@zy-cpa.com
As reported in its
"Summary of Board Decisions" publication, the FASB met on September
21, 2009, and held an informational meeting to discuss the findings of two
research projects designed to test the proposals in its Discussion Paper (DP), Preliminary
Views on Financial Statement Presentation. A representative of the FASB’s Financial Accounting Standards Research Initiative
reported on the results of the experiment conducted to examine credit analyst
reactions to certain changes proposed in the DP and members of the FASB staff
reported on the results of the field test of the proposals in the DP.
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
=======================================
AUDITING AND INTERNAL
CONTROLS HEADLINES:
=======================================
Financial Institutions --
New Edition of Knowledge-Based Audits Published
For detail, please contact info@zy-cpa.com
We have published the 2009
edition of Knowledge-Based Audits of Financial Institutions. This
publication is designed to help the auditor efficiently and effectively perform
financial statement audits of financial institutions in accordance with
auditing standards generally accepted in the
See our Literature Update for
complete details.
Compilation and Review
Engagements -- Discussion and Analysis of AICPA Proposals
For detail, please contact info@zy-cpa.com
We have added a GAAS Update
Service that provides discussion and analysis of the following three AICPA
proposed Statements on Standards for Accounting and Review Services:
-Framework and Objectives
for Performing and Reporting on Compilation and Review Engagements;
-Compilation of Financial
Statements; and
-Review of Financial
Statements.
These proposals collectively
represent the most sweeping changes to the requirements for compilation and
review of financial statements in the last thirty years. Changes from existing
standards include:
-Requirement of a written
engagement letter in compilations and reviews;
-Discussion of internal
control services and guidance for practitioners engaged to perform such
services in addition to compilation or review engagements;
-Revisions to the standard
wording of compilation and review reports;
-Revisions to allow the
accountant to include a general description in the compilation report regarding
the reasons for an independence impairment;
-Replacement of the concept
of limited assurance in a review engagement with the concept of moderate
assurance;
-Introduction of the new
terms review evidence and review risk to the review literature; and
-Discussion of materiality in
the context of a review engagement.
PCAOB Report -- PCAOB
Publishes Report on First Year of Implementation of Auditing Standard No. 5
For detail, please contact info@zy-cpa.com
As discussed above in our
Accounting and SEC Summaries, the PCAOB has published a report, Report on
the First-Year Implementation of Auditing Standard No. 5, An Audit of Internal
Control Over Financial Reporting That Is Integrated with An Audit of Financial
Statements. This report describes the most common or noteworthy
observations that were found from inspections conducted during 2008 regarding
registered audit firms' first year implementation of PCAOB Auditing Standard
No. 5, An Audit of Internal Control Over Financial Reporting That is
Integrated with An Audit of Financial Statements, which became effective
for audits for fiscal years ending on or after Nov. 15, 2007, and replaced
PCAOB Auditing Standard No. 2, An Audit of Internal Control Over Financial Reporting
Performed in Conjunction With an Audit of Financial Statements.
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:
======================
Stabilization Arrangements
-- Reporting Implications of Stabilization Arrangements and Minimum Fund
Balance Policies Discussed
For detail, please contact info@zy-cpa.com
We have added a Governmental
GAAP Update Service that discusses the issuance of GASB No. 54, Fund Balance
Reporting and Governmental Fund Type Definitions, and its guidance on how
to classify and report amounts associated with set-aside arrangements and
minimum fund balance policies. Topics discussed in this update are:
-GASB 54 fund balance
classifications;
-Formal stabilization
arrangements;
-Reporting stabilization
arrangement amounts;
-Minimum fund balance
policies;
-Reporting minimum fund
balance policies and amounts;
-GASB 54 disclosure
requirements;
-Stabilization arrangements;
and
-Minimum fund balance policy.
GASB 54 is effective for
financial statements for periods beginning after June 15, 2010. Early
implementation is encouraged.
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