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Accounting Research
Manager(TM)
Weekly Summary of
Developments
November 9-13, 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
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of this week's Weekly Summary.
Accounting and SEC
Headlines
Variable Interest Entities -- FASB Discusses Deferral of Statement
167 for Certain Investment Entities and Other Matters
Accounting Standards -- FASB and IASB Reaffirm Commitment to
Memorandum of Understanding
EITF Materials -- FASB Issues Additional Materials for
November 19, 2009 EITF Meeting
Executive Compensation -- SEC Deputy Director Addresses
Executive Compensation Disclosures
International Financial
Reporting -- IASB Issues
Agenda for November 17-20, 2009 Meeting
Auditing and Internal
Controls Headlines
Compilations and Reviews -- 2009-2010 Edition of Publication Added
Commercial Entities -- 2010 Edition of Knowledge-Based Audits
Published
Quality Control Standards -- Proposed AICPA Standard Discussed
Government Headlines
Postemployment Benefits -- GASB 45 Discussed
GASB Standards -- Implementation Guide and Other Matters
Discussed
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ACCOUNTING AND SEC HEADLINES:
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Variable Interest Entities
-- FASB Discusses Deferral of Statement 167 for Certain Investment Entities and
Other Matters
For detail, please contact info@zy-cpa.com
As reported in its
"Summary of Board Decisions" publication, the FASB met on November
11, 2009, and discussed the following topics:
-Implementation of FASB
Statement No. 167, Amendments to FASB Interpretation No. 46(R);
-Reconsideration of the scope
of FASB Statement No. 160, Noncontrolling
Interests in Consolidated Financial Statements;
-Oil and gas disclosures; and
-Improving disclosures about
fair value measurements.
The FASB discussed several
issues related to the implementation of Statement 167 for certain types of
asset manager funds and decided that the effective date of this standard will
be deferred for certain funds until the joint IASB/FASB consolidations project
is completed (late 2010). The deferral prescribes that Statement 167 will not
be effective for a reporting entity’s interest in an entity, as long as the
reporting entity and the entity meet all of the following conditions:
-The entity has all of the
attributes specified in FASB Accounting Standards Codification™ Topic
946, Financial Services - Investment Companies, paragraph 946-10-15-2
or, if one or more of the attributes specified in paragraph 946-10-15-2 are not
present, is in an entity for which it is industry practice to issue financial
statements using guidance that is consistent with the measurement principles in
Topic 946.
-The reporting entity does
not have an obligation to fund losses of the entity that could potentially be
significant to the entity. This condition should be evaluated considering any
implicit or explicit guarantees by the reporting entity.
-The reporting entity does
not have an interest in the entity that absorbs a disproportionate share of the
entity’s actual losses to other investors.
Examples of entities that may
meet these conditions include, but are not limited to, mutual funds, hedge
funds, private equity funds, and venture capital funds. Examples of entities
that do not meet these criteria include, but are not limited to, securitization
entities, asset-backed financing entities, or entities formerly classified as
qualifying special purpose entities. Deferring the effective date of Statement
167 for those entities will allow the FASB to resolve issues about how to
distinguish between a principal and agent relationship jointly and consistently
with the IASB.
The FASB also decided to
defer the effective date of Statement 167 for money market mutual funds that
are required to comply with or operate within the requirements of Rule 2a-7 of
the Investment Company Act of 1940 until the joint IASB/FASB consolidations
project is completed.
Regarding reconsideration of
the scope of Statement 160, the FASB discussed comments received on Proposed
Accounting Standards Update, Consolidation (Topic 810): Accounting and
Reporting for Decreases in Ownership of a Subsidiary - a Scope Clarification,
and made the following decisions:
-Affirmed its proposal that
the decrease in ownership provisions of Topic 810 would apply to subsidiaries
or groups of assets that are businesses or nonprofit activities, but would not
apply to sales of in-substance real estate even if the real estate would be
considered a business;
-Clarified the guidance for
accounting for decreases in ownership of subsidiaries that are not businesses
or nonprofit activities; and
-Affirmed that the amendments
to Topic 810 will be effective for periods ending on or after December 15,
2009, and should be applied retrospectively for entities that have already
adopted the guidance in Subtopic 810-10.
Accounting Standards --
FASB and IASB Reaffirm Commitment to Memorandum of Understanding
For detail, please contact info@zy-cpa.com
The FASB and IASB (the
Boards) issued a joint statement reaffirming their commitment to improve IFRS
and U.S. GAAP and to bring about their convergence. The Boards also agreed to
intensify their efforts to complete the major joint projects described in their
2006 Memorandum of Understanding, as updated in 2008. The joint
statement describes their plans and milestone targets for completing the joint
major projects in 2011.
In acknowledging their
continued efforts to develop a common set of high quality standards, the Boards
took note of the support of the leaders of the Group of 20 nations, the
Financial Crisis Advisory Group of the FASB and IASB, and the Monitoring Board
of the International Accounting Standards Committee Foundation for the joint
convergence endeavor currently underway.
EITF Materials -- FASB
Issues Additional Materials for November 19, 2009 EITF Meeting
For detail, please contact info@zy-cpa.com
The FASB has issued the
following additional materials for the November 19, 2009 EITF meeting:
-EITF Issue No. 09-2,
"Research and Development Assets Acquired in an Asset Acquisition"
(issue summary supplement and comment letters);
-EITF Issue No. 09-J,
"Impact of Denominating the Exercise Price of a Share-Based Payment Award
in the Currency of the Market in which the Underlying Equity Security Primarily
Trades" (issue summary); and
-EITF Issue No. 09-B,
"Consideration of an Insurer's Accounting for Majority Owned Investments
When the Ownership Is through a Separate Account" (comment letter).
Executive Compensation --
SEC Deputy Director Addresses Executive Compensation Disclosures
For detail, please contact info@zy-cpa.com
On November 9, 2009, Shelley Parratt, a Deputy Director in the Division of Corporation
Finance (Corp Fin) of the SEC, gave a speech entitled, “Executive Compensation
Disclosure: Observations on the 2009 Proxy Season and Expectations for 2010.”
In her remarks, Ms. Parratt provided observations on
matters identified by the Corp Fin staff related to 2009 executive compensation
disclosures under SEC rules during its review of registrant filings, and provided
her thoughts on what the Corp Fin staff hopes to see in the upcoming 2010 proxy
season.
Ms. Parratt
indicated that the staff in Corp Fin concluded that many registrants may be
disinclined to disclose detailed compensation information and prepare a
rigorous analytical discussion of compensation practices until specifically
asked to do so in a review. In her comments, Ms. Parratt
reminded registrants to take a proactive approach to improve their Compensation
Discussion and Analysis disclosures.
Ms. Parratt
also highlighted the following two areas where registrants should focus their
attention for the 2010 proxy season:
-Provide analysis of the
“how” and “why” certain compensation decisions were made as opposed to
providing exhaustive details about the framework in which these decisions were
made; and
-In discussing performance
targets related to executive compensation, include information that will help
shareholders understand how the registrant’s pay programs achieve the goal of
payment for performance.
International Financial
Reporting -- IASB Issues Agenda for November 17-20, 2009 Meeting
For detail, please contact info@zy-cpa.com
The IASB is expected to
discuss the following agenda items at its November 17-20, 2009 meeting:
-Employee benefits;
-Income taxes;
-Leases (joint meeting with
FASB);
-Insurance contracts (joint meeting
with FASB);
-Discontinued operations
(joint meeting with FASB);
-Revenue recognition (joint
meeting with FASB);
-Emissions trading schemes
(joint meeting with FASB);
-Liabilities - Amendments to
IAS 37, Provisions, Contingent Liabilities and Contingent Assets;
-IASB Standards Advisory
Council update;
-Amendments to IFRS 1, First-time
Adoption of International Financial Reporting Standards;
-International Financial
Reporting Interpretations Committee (IFRIC) update; and
-Ratification of
interpretation on IFRIC D25, Extinguishing Financial Liabilities with Equity
Instruments.
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:
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Compilations and Reviews
-- 2009-2010 Edition of Publication Added
For detail, please contact info@zy-cpa.com
We have published the
2009-2010 edition of Compilations & Reviews.
The primary objective of this publication is to provide practitioners with a
fundamental, real-world approach for conducting high quality compilations and
reviews. This edition has been updated to reflect:
-Expanded discussion of
guidance from AICPA Statement on Quality Control Standards No. 7, A Firm's
System of Quality Control;
-New pronouncements through
the issuance of AICPA Accounting and Review Services Standards No. 17, Omnibus
Statement on Standards for Accounting and Review Services - 2008;
-Discussion of the impact of
IFRS;
-Expanded discussion of the
concept "submission of financial statements"; and
-Expanded discussions of the
proper accounting for subsequent events and going concern.
See our Literature Update for
complete details.
Commercial Entities --
2010 Edition of Knowledge-Based Audits Published
For detail, please contact info@zy-cpa.com
We have published the 2010
edition of Knowledge-Based Audits of Commercial Entities. This
publication is designed to help the auditor efficiently and effectively perform
financial statement audits of nonpublic commercial entities in accordance with
auditing standards generally accepted in the
See our Literature Update for
complete details.
Quality Control Standards
-- Proposed AICPA Standard Discussed
For detail, please contact info@zy-cpa.com
We have added a GAAS Update
Service that discusses the AICPA's proposed Statement
on Quality Control Standards (SQCS), A Firm’s System of Quality Control
(Redrafted), which would supersede SQCS No. 7 (QC 10) of the same name. To
facilitate convergence with the International Standards on Quality Control (ISQCs), the proposed standard has been drafted using ISQC
No. 1, Quality Control For Firms That Perform
Audits and Reviews of Financial Statements, and Other Assurance and Related
Services Engagements, as a base. The differences between the AICPA’s proposed SQCS and ISQC 1 that have no compelling
reason have been eliminated.
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:
======================
Postemployment Benefits -- GASB 45 Discussed
For detail, please contact info@zy-cpa.com
We have added a Governmental
GAAP Update Service that is the first in a two-part series that discusses the
basic requirements of GASB Statement No. 45, Accounting and Reporting by
Employers for Postemployment Benefits Other than
Pensions, from the perspective of small government employers. This Update
provides an understanding of the different types of postemployment
benefits other than pensions (OPEB) plans and the basic accounting concepts and
terminology used in GASB 45. Topics covered in this Update are:
-Types of OPEB plans;
-OPEB funding methods;
-Overview of accounting
recognition for annual OPEB costs by type of plan;
-Actuarial valuation
requirements for defined benefit OPEB plans;
-Defined benefit plan
terminology;
-The annual required
contribution (ARC), annual OPEB cost, and net OPEB obligation for defined
benefit plans;
-Components of the ARC;
-Components of annual OPEB
cost; and
-Computing the net OPEB
obligation or asset.
GASB Standards --
Implementation Guide and Other Matters Discussed
For detail, please contact info@zy-cpa.com
The October 2009 edition of
the "GASB Report" has been issued and includes the following discussion
items:
-GASB calendar;
-2009-2010 Comprehensive
Implementation Guide available;
-Summary of GASB meeting held
on September 15, 2009; and
-Overview of the GASB's current technical agenda.
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