===================================================
Accounting Research Manager(TM)
Weekly Summary of Developments
January 18-22, 2010
===================================================

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

Fair Value Measurements -- FASB Issues Accounting Standards Update on Improving Disclosures about Fair Value Measurements
Checklist -- AutoCheck U.S. GAAP Disclosures Checklist Updated
FASB Codification -- FASB Issues Technical Corrections to SEC Content
New Accounting Standards -- Checklist Updated
Fair Value Measurement -- FASB Discusses Fair Value Measurement and Other Matters
Non-GAAP Financial Measures -- SEC Staff Revises Interpretations
Proxy Disclosures -- SEC Staff Updates Interpretations
Checklist -- SEC Staff Updates Interpretations
Oil and Gas Reporting -- SEC Staff Issue Small Entity Compliance Guide
Engagement Quality Review -- SEC Approves PCAOB Rules on Engagement Quality Review
SEC Enforcement -- SEC Publishes Policy Statement to Encourage Cooperation in Investigations

Auditing and Internal Controls Headlines

Not-for-Profits -- New Edition of Knowledge-Based Audits Published
Engagement Quality Review -- SEC Approves PCAOB Rules on Engagement Quality Review

=============================
ACCOUNTING AND SEC HEADLINES:
=============================

Fair Value Measurements -- FASB Issues Accounting Standards Update on Improving Disclosures about Fair Value Measurements
For detail, please contact info@zy-cpa.com


The FASB has issued ASU No. 2010-06, Fair Value Measurements and Disclosures (Topic 820): Improving Disclosures about Fair Value Measurements. This ASU requires some new disclosures and clarifies some existing disclosure requirements about fair value measurement as set forth in Codification Subtopic 820-10. The FASB’s objective is to improve these disclosures and, thus, increase the transparency in financial reporting. Specifically, ASU 2010-06 amends Codification Subtopic 820-10 to now require:

-A reporting entity should disclose separately the amounts of significant transfers in and out of Level 1 and Level 2 fair value measurements and describe the reasons for the transfers; and
-In the reconciliation for fair value measurements using significant unobservable inputs, a reporting entity should present separately information about purchases, sales, issuances, and settlements.

In addition, ASU 2010-06 clarifies the requirements of the following existing disclosures:

-For purposes of reporting fair value measurement for each class of assets and liabilities, a reporting entity needs to use judgment in determining the appropriate classes of assets and liabilities; and
-A reporting entity should provide disclosures about the valuation techniques and inputs used to measure fair value for both recurring and nonrecurring fair value measurements.

ASU 2010-06 is effective for interim and annual reporting periods beginning after December 15, 2009, except for the disclosures about purchases, sales, issuances, and settlements in the roll forward of activity in Level 3 fair value measurements. Those disclosures are effective for fiscal years beginning after December 15, 2010, and for interim periods within those fiscal years. Early application is permitted.

Checklist -- AutoCheck U.S. GAAP Disclosures Checklist Updated
For detail, please contact info@zy-cpa.com


The AutoCheck U.S. GAAP Disclosures Checklist has been updated through December 31, 2009. This checklist includes changes made by the FASB to the FASB Accounting Standards CodificationTM (Codification) since the issuance of our checklist dated September 30, 2009. This checklist is organized by accounting topic, consistent with the Codification's broad structure, and provides authoritative references. Once completed, it can be printed and placed in annual or quarterly work papers to provide support for review and compliance procedures.

This checklist has been updated for the following changes:

-Accounting Standards Update (ASU) No. 2009-15, Accounting for Own-Share Lending Arrangements in Contemplation of Convertible Debt Issuance or Other Financing;
-ASU No. 2009-16, Transfers and Servicing (Topic 860) - Accounting for Transfers of Financial Assets;
-ASU No. 2009-17, Consolidations (Topic 810) - Improvements to Financial Reporting by Enterprises Involved with Variable Interest Entities; and
-ASU No. 2010-02, Consolidation (Topic 810) - Accounting and Reporting for Decreases in Ownership of a Subsidiary - a Scope Clarification.

As explained at the bottom of our Literature Update, existing users of the AutoCheck checklist must update the checklist previously used. This process will be necessary each time we update this checklist.

FASB Codification -- FASB Issues Technical Corrections to SEC Content

The FASB has issued the following two updates to the Codification:

-ASU No. 2010-04, Accounting for Various Topics: Technical Corrections to SEC Paragraphs; and
For detail, please contact info@zy-cpa.com


-ASU No. 2010-05, Compensation - Stock Compensation (Topic 718): Escrowed Share Arrangements and the Presumption of Compensation.
For detail, please contact info@zy-cpa.com


ASU 2010-04 and ASU 2010-05 contain revisions to various “S” Sections in the Codification. These Sections reflect certain rules, regulations, interpretive releases of the SEC, which represent authoritative guidance for SEC registrants. The “S” Sections also include content from certain SEC Staff Accounting Bulletins as well as SEC Staff Announcements and SEC Observer Comments made at EITF meetings.

The technical corrections in ASU 2010-04 primarily reflect revisions to “S” Sections of various Codification Topics related to SEC Staff Announcements, to reflect the appropriate Codification references.

ASU 2010-05 updates paragraph 718-10-S99-2 of Codification Topic 718, Compensation - Stock Compensation, to reflect an SEC Staff Announcement on the SEC staff’s views on overcoming the presumption that escrowed share arrangements represent compensation for certain shareholders. This SEC Announcement codifies the SEC staff view documented in EITF Topic D-110, “Escrowed Share Arrangements and the Presumption of Compensation.”

New Accounting Standards -- Checklist Updated
For detail, please contact info@zy-cpa.com


We have updated our publication "Summary Checklist of Recent Authoritative U.S. Accounting Standards." This checklist is intended to serve as a reference tool to help users ensure that they have considered authoritative standards recently issued or approved by the FASB. The standards are listed by source and a summary of the transition guidance is provided with a reference to the relevant Codification paragraph(s). Effective dates and application (adoption) requirements are also presented.

We have updated this checklist to reflect the issuance of: (a) ASU 2010-04; (b) ASU 2010-05; and (c) ASU 2010-06. See our discussion of these updates above.

Fair Value Measurement -- FASB Discusses Fair Value Measurement 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 January 18-20, 2010, and discussed the following topics:

-Fair value measurement;
-Revenue recognition;
-Financial instruments with characteristics of equity;
-Insurance contracts;
-Consolidation;
-Financial statement presentation;
-Accounting for financial instruments: hedge accounting;
-Leases; and
-Accounting for financial instruments: classification and measurement.

Regarding their project on fair value measurement, the Boards tentatively decided:

-To retain the term "fair value."
-To define fair value as an exit price.
-The guidance for measuring fair value in markets that have become less active: (a) pertains to when there has been a significant decline in the volume and level of activity for the asset or liability; and (b) focuses on whether an observed transaction price is orderly, not on the level of activity in a market.
-The transaction price might not represent the fair value of an asset or liability at initial recognition if, for example, any of the following conditions exist: (a) the transaction is between related parties; (b) the transaction takes place under duress or the seller is forced to accept the price in the transaction; (c) the unit of account represented by the transaction is different from the unit of account for the asset or liability measured at fair value; or (d) the market in which the transaction takes place is different from the market in which the entity would sell the asset or transfer the liability.
-The Boards will address the recognition of day one gains or losses at a later date.

Non-GAAP Financial Measures -- SEC Staff Revises Interpretations
For detail, please contact info@zy-cpa.com


The staff in the Division of Corporation Finance (Corp Fin) of the SEC has revised its recently issued Compliance and Disclosure Interpretation (C&DI), Non-GAAP Financial Measures, which provides interpretations, in a question and answer (Q&A) format, of the SEC’s rules and regulations on the use of non-GAAP financial measures, including Regulation G and Item 10(e) of Regulation S-K. The staff in Corp Fin has revised this C&DI as follows:

-Withdrawn question 105.04; and
-Added new question 105.07.

Question 105.07 provides guidance on the requirements of Item 2.02 of Form 8-K related to information required for companies disclosing previously undisclosed material nonpublic information in an earnings conference call, and the exemptions from those requirements under Item 2.02(b).

Proxy Disclosures -- SEC Staff Updates Interpretations
For detail, please contact info@zy-cpa.com


The staff in Corp Fin has updated its C&DI, Proxy Disclosure Enhancements Transition. This C&DI provides interpretations by Corp Fin, in a Q&A format, of how the effective date (February 28, 2010) of the SEC's recently issued final rule, Proxy Disclosure Enhancements, applies to the filing of proxy statements, Form 10-Ks, Form 8-Ks, and registration statements at or around the time of the effective date. Updates to this C&DI include guidance on the following items:

-If the annual meeting of shareholders takes place before February 28, 2010, how should the results of the meeting be reported on Form 10-K or Form 10-Q if such form is due on or after February 28, 2010; and
-The impact of the effective date on a reporting issuer with a fiscal year ending on or after December 20, 2009 that files a registration statement on or after December 20, 2009.

Checklist -- SEC Staff Updates Interpretations
For detail, please contact info@zy-cpa.com


The staff in Corp Fin has updated its C&DI, Regulation S-K. This C&DI provides interpretations by Corp Fin, in a Q&A format, of Regulation S-K. The staff in Corp Fin has updated guidance in this C&DI in the following areas:

-Disclosure of each director or nominee's experience, qualifications, attributes or skills;
-Disclosure by a company with a classified board of why a director's particular and specific experience, qualifications, attributes or skills led the board to conclude that the person should serve as a director at the time that a filing containing the disclosure is made, if the director is not up for re-election at the upcoming shareholders' meeting;
-Inclusion of the grant date fair value of a forfeited award be included for purposes of determining 2009 total compensation and identifying 2009 named executive officers;
-Whether the grant date fair value reported for awards subject to time-based vesting also exclude the effect of estimated forfeitures;
-Where should a registrant present required narrative disclosure of the registrant's compensation policies and practices as they relate to the registrant's risk management in its filings; and
-Scope of executive compensation consultant disclosure requirements.

Oil and Gas Reporting -- SEC Staff Issue Small Entity Compliance Guide
For detail, please contact info@zy-cpa.com


The staff of the SEC has issued a Small Entity Compliance Guide, Oil and Gas Reporting Modernization. This Guide is intended to assist certain small entities comply with the SEC's revisions to modernize its oil and gas reporting disclosures. Topics covered in this Guide are:

-Compliance dates for the new rules;
-Changes to oil and gas definitions in Rule 4-10 of Regulation S-X;
-Consolidation of disclosure requirement in Subpart 1200 of Regulation S-K;
-MD&A guidance;
-Ceiling test limitation for capitalized costs under Full Cost Method; and
-Accounting treatment and no retroactive revision.

Engagement Quality Review -- SEC Approves PCAOB Rules on Engagement Quality Review
For detail, please contact info@zy-cpa.com


The SEC has issued, Public Company Accounting Oversight Board; Order Approving Proposed Rules on Auditing Standard No. 7, Engagement Quality Review, and Conforming Amendment. This order approves the previously adopted PCAOB Auditing Standard (AS) No. 7, Engagement Quality Review, and a conforming amendment to PCAOB Interim Quality Control Standards. AS 7, as approved by the SEC, is consistent with its original adoption by the PCAOB on July 28, 2009. It provides a framework for the engagement quality reviewer (sometimes known as the second or concurring partner) to objectively evaluate the significant judgments made and related conclusions reached by the engagement team in forming an overall conclusion about the engagement. According to the PCAOB, this standard and conforming amendment focus the engagement quality reviewer’s attention on the areas that are most likely to contain significant engagement deficiencies and increase the likelihood of identifying and correcting those deficiencies before the audit report is issued.

The rules are effective for the engagement quality review of audits and interim reviews for fiscal years beginning on or after December 15, 2009.

SEC Enforcement -- SEC Publishes Policy Statement to Encourage Cooperation in Investigations
For detail, please contact info@zy-cpa.com


The SEC has issued, Policy Statement Concerning Cooperation by Individuals in its Investigations and Related Enforcement Actions. This statement provides the analytical framework used by the SEC and its staff to evaluate cooperation by individuals in investigations and related enforcement actions. According to the SEC, this framework serves the following important purposes: (a) it promotes the fair and effective exercise of discretion by the SEC; and (b) it enhances confidence on the part of the public and cooperating individuals that decisions regarding cooperation in the SEC’s investigations and related enforcement actions will be made in an appropriate and consistent manner.

Although the evaluation of cooperation requires a case-by-case analysis of the specific circumstances presented, the SEC’s general approach is to determine whether, how much, and in what manner to credit cooperation by individuals by evaluating the following four considerations:

-Assistance provided by the cooperating individual in the SEC’s investigation or related enforcement actions;
-Importance of the underlying matter in which the individual cooperated;
-Societal interest in ensuring that the cooperating individual is held accountable for his or her misconduct; and
-Appropriateness of cooperation credit based upon the profile of the cooperating individual.

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:
=======================================

Not-for-Profits -- New Edition of Knowledge-Based Audits Published
For detail, please contact info@zy-cpa.com


We have published Knowledge-Based Audits of Not-for-Profit Organizations with Single Audits. This publication combines everything an auditor needs to perform financial statement audits in accordance with Government Auditing Standards (also know as the "Yellow Book "), and single audits in accordance with OMB Circular A-133. This edition reflects comprehensive coverage of current authoritative literature including extensive revisions and updated discussions to reflect auditing pronouncements through AICPA Statement on Auditing Standards No. 115, Communicating Internal Control Related Matters Identified in an Audit.

See our Literature Update for complete details.

Engagement Quality Review -- SEC Approves PCAOB Rules on Engagement Quality Review
For detail, please contact info@zy-cpa.com


As discussed above in our Accounting and SEC Summaries, the SEC has issued, Public Company Accounting Oversight Board; Order Approving Proposed Rules on Auditing Standard No. 7, Engagement Quality Review, and Conforming Amendment. This order approves the previously adopted PCAOB Auditing Standard (AS) No. 7, Engagement Quality Review, and a conforming amendment to PCAOB Interim Quality Control Standards. AS 7, as approved by the SEC, is consistent with its original adoption by the PCAOB on July 28, 2009. It provides a framework for the engagement quality reviewer (sometimes known as the second or concurring partner) to objectively evaluate the significant judgments made and related conclusions reached by the engagement team in forming an overall conclusion about the engagement. According to the PCAOB, this standard and conforming amendment focus the engagement quality reviewer’s attention on the areas that are most likely to contain significant engagement deficiencies and increase the likelihood of identifying and correcting those deficiencies before the audit report is issued.

The rules are effective for the engagement quality review of audits and interim reviews for fiscal years beginning on or after December 15, 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