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Accounting Research
Manager(TM)
Weekly Summary of
Developments
October 26-30, 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
Oil and Gas Activities -- SEC Staff Publishes New/Updated Oil
and Gas Interpretations
Shareholder Proposals -- SEC Staff Issues Guidance
EDGAR -- SEC Publishes Updated EDGAR Filer
Manual
Revenue Recognition -- FASB Discusses Revenue Recognition and
Other Matters
EITF Materials -- FASB Issues Materials for November 19,
2009 EITF Meeting
Financial Crisis -- IASB Discusses Financial Crisis and
Other Issues
International Accounting -- IASB Publishes Agenda for November
5-6, 2009 IFRIC Meeting
Auditing and Internal
Controls Headlines
Auditing Standards -- AICPA Issues Proposed Guidance on
Terms of Engagement and Written Representations
Compilations and Reviews -- New Knowledge-Based Publication Added
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ACCOUNTING AND SEC HEADLINES:
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Oil and Gas Activities --
SEC Staff Publishes New/Updated Oil and Gas Interpretations
The staff in the SEC's
Division of Corporation Finance (Corp Fin) has issued a new Compliance and
Disclosure Interpretation (C&DI), Oil and Gas Rules: For detail, please contact info@zy-cpa.com.
This C&DI provides interpretations
by Corp Fin, in a question and answer format, of the oil and gas rules in
Regulation S-X and Regulation S-K. Topics covered in this C&DI include: (a)
definitions of certain terms associated with oil and gas activities, including
deterministic estimate, development project, and possible, probable, and proved
oil and gas reserves; and (b) disclosure by registrants engaged in oil
and gas producing activities.
Corp Fin has also updated its
C&DI, Regulation S-K (new questions 154.01-154.03), to provide
additional guidance on disclosure by registrants engaged in oil and gas
producing activities:
For detail, please contact info@zy-cpa.com
Shareholder Proposals --
SEC Staff Issues Guidance
For detail, please contact info@zy-cpa.com
The staff in Corp Fin has issued
Staff Legal Bulletin No. 14E (CF), Shareholder Proposals. This guidance
provides information for companies and shareholders regarding Rule 14a-8 under
the Securities Exchange Act of 1934. Specifically, this legal bulletin contains
information regarding the:
-Application of Rule 14a-8(i)(7) to proposals relating to
risk;
-Application of Rule 14a-8(i)(7) to proposals focusing on succession planning for a
company's chief executive officer; and
-Manner in which shareholder
proponents and companies can notify the SEC that they will be submitting
correspondence in connection with a no-action request.
Rule 14a-8 addresses
shareholder proposals when soliciting proxies.
EDGAR -- SEC Publishes
Updated EDGAR Filer Manual
For detail, please contact info@zy-cpa.com
The SEC has published a final
rule, Adoption of Updated EDGAR Filer Manual. This final rule includes
revisions to the Electronic Data Gathering, Analysis, and Retrieval System
(EDGAR) Filer Manual to reflect updates to the EDGAR system made primarily
to:
-Enforce additional eXtensible Business Reporting Language (XBRL) validation
requirements to improve the quality of XBRL exhibits;
-Allow filers to
electronically submit the withdrawal of application for exemptive
or other relief from the Investment Company Act of 1940 as new submission types
"APP WD" or "APP WD/A"; and
-Allow filers to add “Subject
Company” related information for certain specified submission types.
This final rule is effective
October 30, 2009.
Revenue Recognition --
FASB Discusses Revenue Recognition and Other Matters
For detail, please contact info@zy-cpa.com
As reported in its
"Summary of Board Decisions" publication, the FASB and IASB (the
"Boards") held a joint meeting on October 26-28, 2009, and discussed
the following topics:
-Revenue recognition;
-Reporting discontinued
operations;
-Accounting for financial
instruments;
-Consolidation;
-Financial instruments with
characteristics of equity;
-Statement of comprehensive
income;
-Financial statement
presentation;
-Fair value measurement;
-Insurance contracts;
-Leases;
-FASB/IASB technical plan;
and
-Income taxes.
The Boards reached a number
of decisions regarding these topics, which are detailed in the FASB's publication.
Regarding revenue
recognition, the Boards considered additional guidance to help an entity
determine how much revenue to recognize. Specifically, the Boards discussed
allocating the transaction price and decided tentatively that:
-An entity should allocate
the transaction price to segments of a contract rather than to individual
performance obligations;
-When segmenting a contract,
an entity should consider when the promised goods and services are transferred
to the customer, the margins for those goods and services, and materiality;
-An entity should estimate
stand-alone selling prices if they are not observable, and an entity should
maximize the use of observable inputs; and
-The expected exposure draft
should not prescribe or preclude any particular method of estimating a
standalone selling price.
Regarding financial instruments,
the Boards discussed possible alternatives for presenting some financial
instruments that are not measured at fair value through net income. The Boards
agreed that for financial instruments with principal amounts that are held for
collection or payment of contractual cash flows rather than for sale or
settlement with a third party both fair value and amortized cost are relevant
information. The FASB is expected to continue to consider the financial
statement presentation of financial instruments other than those carried at
fair value through income.
The Boards also discussed
recent and ongoing efforts to amend the requirements for consolidation. At this
meeting, the Boards made the following decisions/actions regarding
consolidation:
-The objectives for assessing
control of structures that would be classified as variable interest entities
under the recent amendments to U.S. GAAP on consolidation and in the proposed
IASB model are fundamentally the same;
-Identified some differences
in the application of those principles and agreed to conduct their respective
projects on consolidation jointly and deliberate issues relating to the
consolidation guidance at monthly joint meetings;
-The IASB agreed to amend its
project timetable to give both Boards the opportunity to deliberate the
consolidation requirements, with the goal that the FASB would publish an
exposure draft that is consistent with the consolidation standard issued by the
IASB; and
-The FASB expects to be in a
position to publish an exposure draft at the beginning of the second quarter of
2010, and the IASB has tentatively decided that it should publish its final
standard after it has considered, with the FASB, comment letters the FASB
receives on its expected proposals.
EITF Materials -- FASB
Issues Materials for November 19, 2009 EITF Meeting
For detail, please contact info@zy-cpa.com
The FASB has issued the
following materials for the November 19, 2009 EITF meeting:
-Agenda Committee report;
-EITF Issue No. 08-9,
"Milestone Method of Revenue Recognition" (comment letter);
-EITF Issue No. 09-2,
"Research and Development Assets Acquired in an Asset Acquisition"
(comment letters);
-EITF Issue No. 09-B,
"Consideration of an Insurer's Accounting for Majority Owned Investments
When the Ownership Is through a Separate Account" (comment letters); and
-EITF Issue No. 09-E,
"Accounting for Stock Dividends, Including Distributions to Shareholders
with Components of Stock and Cash" (comment letters).
Financial Crisis -- IASB
Discusses Financial Crisis and Other Issues
For detail, please contact info@zy-cpa.com
As reported in its "IASB
Update" publication, the IASB met on October 19-23, 2009, and discussed
the following topics:
-Financial crisis;
-Financial statement
presentation;
-Insurance contracts;
-Amendments to IAS 37, Provisions,
Contingent Liabilities and Contingent Assets;
-Other comprehensive income;
and
-Post-employment benefits.
The IASB reached a number of
tentative decisions regarding these topics, which are detailed in the IASB
Update.
International Accounting -- IASB Publishes Agenda for November 5-6, 2009
IFRIC Meeting
For detail, please contact info@zy-cpa.com
The IASB has published an
agenda for the November 5-6, 2009 meeting of the International Financial
Reporting Interpretations Committee (IFRIC). Topics expected to be discussed at
this IFRIC meeting include the following:
-Accounting for stripping
costs in the production phase;
-Debt to equity swaps;
-Review of tentative agenda
decisions previously published;
-Staff recommendations for
tentative agenda decisions; and
-IFRIC work in progress.
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 Standards --
AICPA Issues Proposed Guidance on Terms of Engagement and Written
Representations
For detail, please contact info@zy-cpa.com
The AICPA has issued for
public comment an exposure draft of two proposed Statements on Auditing
Standards (SASs), Terms of Engagement, and Written
Representations. The proposed SAS on terms of engagement makes a number of
changes to existing standards, including:
-The auditor is required to
determine whether the financial reporting framework to be applied in the
preparation of the financial statements is acceptable.
-The auditor must obtain the
agreement of management that it acknowledges and understands its responsibility
for selecting the appropriate financial reporting framework, establishing and
maintaining internal control, and providing access and information to the
auditor.
-In cases where management or
those charged with governance impose a limitation on the scope of the auditor’s
work in the terms of a proposed audit engagement such that the auditor believes
the limitation will result in the auditor disclaiming an opinion on the
financial statements as a whole, the auditor should not accept such a limited
engagement as an audit engagement unless the audit is required by law or
regulation.
-The auditor is required to
assess whether circumstances require the terms of the audit engagement to be
revised.
The AICPA states in the
proposed SAS on written representations that the guidance in this proposal
conforms to international standards and does not change existing
As proposed, this guidance
would be effective for audits of financial statements for periods beginning on
or after December 15, 2010.
Comments on the AICPA’s exposure draft are due January 15, 2010.
Compilations and Reviews
-- New Knowledge-Based Publication Added
For detail, please contact info@zy-cpa.com
We have added the new
publication Knowledge-Based Compilations and Reviews to our audit
library. This publication is designed to help the accountant efficiently and
effectively perform financial statement compilations and reviews of nonpublic
commercial entities in accordance with Statements on Standards for Accounting
and Review Services issued by the Accounting and Review Services Committee of
the AICPA. This publication is based on a methodology that emphasizes using
knowledge of the entity to perform compilation and review engagements.
See our Literature Update for
complete details.
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