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Accounting Research
Manager(TM)
Weekly Summary of
Developments
October 4-8, 2010
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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
Financial Reporting Manual -- SEC Staff Issues June 2010 Update
Asset-Backed Securities -- SEC Issues Proposal Regarding Required
Disclosures for Asset-Backed Securities
New Accounting Standards -- Checklist Updated
PCAOB Registration -- PCAOB Addresses Registration
Applications From Firms in Non-U.S. Jurisdictions
Health Care Entities -- FASB Issues Proposal on Disclosure
about Net Revenue and Allowance for Doubtful Accounts
Intangibles -- FASB Issues Proposal on How the
Carrying Amount of a Reporting Unit Should Be Calculated When Performing Step 1
of the Goodwill Impairment Test
Business Combinations -- FASB Issues Proposal on Disclosure of
Supplementary Pro Forma Information for Business Combinations
EITF Matters -- September 16, 2010 Meeting Minutes
Published
EITF Materials -- FASB Issues Materials for November 19,
2010 EITF Meeting
Repurchase Agreements -- FASB Discusses Repurchase Agreements
International Accounting -- Publication Comparing U.S. GAAP and
IFRS Updated
Fair Value Option -- IASB Discusses Fair Value Option for
Financial Liabilities
IFRS for SMEs
-- Upcoming Training Workshops and Other Matters Discussed
Auditing and Internal
Controls Headlines
Work of Other Auditors -- PCAOB Staff Interpretive Guidance
Discussed
Compilation and Reviews -- New Edition of Knowledge-Based
Compilations and Reviews Published
PCAOB Registration -- PCAOB Addresses Registration
Applications From Firms in Non-U.S. Jurisdictions
Government Headlines
Yellow Book -- GAO Exposure Draft Discussed
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ACCOUNTING AND SEC HEADLINES:
=============================
Financial Reporting Manual
-- SEC Staff Issues June 2010 Update
For detail, please contact info@zy-cpa.com
The staff in the SEC's Division
of Corporation Finance (Corp Fin) has updated its Financial Reporting
Manual, as of June 30, 2010. This manual represents informal guidance
prepared for use by the Corp Fin staff. Corp Fin has made this manual public
because readers may find the guidance useful in preparing filings with the SEC.
Updates in this edition of the manual include the following areas (identified
below in parentheses by section number in the manual):
-Predecessor Financial
Statements (section 1170);
-Development Stage Company (section
1180);
-Interim Period Reporting
Considerations (section 1500);
-SAB 80: Application of S-X
3-05 in Initial Registration Statements (SAB Topic 1J) (section 2070);
-Real Estate Operations -
When to Present Financial Statements (section 2310);
-Real Estate Operations -
Individually Insignificant Acquisitions (section 2320);
-Real Estate Operations -
Special Requirements for "Blind Pool" Offerings (section 2325);
-Properties Subject to Net
Lease (section 2340);
-Equity Method Investments,
Including Fair Value Option [S-X 3-09, S-X 4-08(g), S-X 8-03, S-X 10-01(b)(1),
and SAB Topic 6K.4.b] (section 2400);
-Guarantors of Securities
[S-X 3-10 and S-X 8-01 Note 3] (section 2500);
-Collateralizations (section
2600);
-Parent-only Financial
Statements (Condensed) [S-X 5-04] [S-X 9-06]; (section 2810); and
-Reverse Acquisitions
(section 5230).
Asset-Backed Securities --
SEC Issues Proposal Regarding Required Disclosures for Asset-Backed Securities
For detail, please contact info@zy-cpa.com
The SEC has issued a proposed
rule, Disclosure for Asset-Backed Securities Required by Section 943 of the
Comments on this proposal are
due November 15, 2010.
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 FASB Accounting
Standards CodificationTM
(Codification) paragraph(s). Effective dates and application (adoption)
requirements are also presented.
We have updated our checklist
to reflect the issuance of FASB Accounting Standards Update (ASU) No. 2010-25, Plan
Accounting—Defined Contribution Pension Plans (Topic 962): Reporting Loans to
Participants by Defined Contribution Pension Plans. This ASU amends the
guidance in the Codification to require that participant loans be classified as
notes receivable from participants, which are segregated from plan investments
and measured at their unpaid principal balance plus any accrued but unpaid
interest.
See our Literature Update for
complete details.
PCAOB Registration --
PCAOB Addresses Registration Applications From Firms
in Non-U.S. Jurisdictions
For detail, please contact info@zy-cpa.com
The PCAOB published a
release, Consideration of Registration Applications from Public Accounting
Firms in Non-U.S. Jurisdictions Where There Are Unresolved Obstacles to PCAOB
Inspections. This release addresses registration applications from firms in
non-U.S. jurisdictions where, because of asserted legal restrictions or
objections of local authorities, the PCAOB is denied access to information from
PCAOB-registered firms that is necessary to inspect those firms. Effective for
all pending and future applications from accounting firms in such
jurisdictions, the PCAOB will ask the applicant to state its understanding of
whether a PCAOB inspection of the firm would currently be allowed by local law
or local authorities. The applicant may choose to keep its application pending
until it can respond, with confirmation from the appropriate authority in the
jurisdiction, that PCAOB inspection is permitted. If the applicant, in order to
obtain earlier action on its application, responds that PCAOB inspection would
not currently be allowed, the PCAOB will issue a "Notice of Hearing"
to consider whether, in light of the obstacle to inspection, approval of the
application would be consistent with the PCAOB's
responsibility under the Sarbanes-Oxley Act of 2002.
Health Care Entities --
FASB Issues Proposal on Disclosure about Net Revenue and Allowance for Doubtful
Accounts
For detail, please contact info@zy-cpa.com
The FASB has issued for
public comment a proposed ASU, Health Care Entities (Topic 954): Disclosure
about Net Revenue and Allowance for Doubtful Accounts. This proposed ASU
reflects the consensus-for-exposure in EITF Issue No. 09-H, “Health Care Entities:
Revenue Recognition.” The amendments in this proposed ASU would require a
health care entity to provide enhanced disclosure about how it considers the
ability to collect in the determination of the amount and timing of revenue and
bad-debt expense. The ASU would also require disclosures of net revenue as well
as a reconciliation of the activity in the allowance for doubtful accounts by
major payor type.
As proposed, the guidance in
this ASU would be applied retrospectively to all periods presented. The
effective date for this proposed ASU has not been established.
Comments on this proposed ASU
are due November 5, 2010.
Intangibles -- FASB Issues
Proposal on How the Carrying Amount of a Reporting Unit Should Be Calculated
When Performing Step 1 of the Goodwill Impairment Test
For detail, please contact info@zy-cpa.com
The FASB has issued for
public comment a proposed ASU, Intangibles - Goodwill and Other (Topic 350)
How the Carrying Amount of a Reporting Unit Should Be Calculated When
Performing Step 1 of the Goodwill Impairment Test. This proposed ASU
reflects the consensus-for-exposure in EITF Issue No. 10-A, “How the Carrying
Amount of a Reporting Unit Should be Calculated When
Performing Step 1 of the Goodwill Test.” The amendments in this proposed ASU
would clarify that the equity premise is the only method an entity can use for
purposes of calculating the carrying amount of a reporting unit. In addition,
this ASU would modify Step 1 of the goodwill impairment test for reporting
units with zero or negative carrying amounts. For those reporting units, an
entity would be required to perform Step 2 of the goodwill impairment test if
there are adverse qualitative factors that indicate that it is more likely than
not that a goodwill impairment exists. Under this proposed ASU, any previously
recognized goodwill impairment taken as a result of applying an alternative
premise before adopting the amendments in this proposed guidance would not be
permitted to be reversed.
For public entities, the
amendments in this proposed ASU would be effective for fiscal years, and
interim periods within those years, beginning after December 15, 2010. Early
adoption would not be permitted. For nonpublic entities, the amendments in this
proposed ASU would be effective for fiscal years, and interim periods within
those years, beginning after December 15, 2011. Nonpublic reporting entities
would be able to early adopt the proposed amendments using the effective date
for public reporting entities.
Comments on this proposed ASU
are due November 5, 2010.
Business Combinations --
FASB Issues Proposal on Disclosure of Supplementary Pro Forma Information for
Business Combinations
For detail, please contact info@zy-cpa.com
The FASB has issued for
public comment a proposed ASU, Business Combinations (Topic 805): Disclosure
of Supplementary Pro Forma Information for Business Combinations. This
proposed ASU reflects the consensus-for-exposure in EITF Issue No. 10-G,
“Disclosure of Supplementary Pro Forma Information for Business Combinations.”
The amendments in this proposed ASU specify that if a public entity presents
comparative financial statements, the entity would disclose revenue and
earnings of the combined entity as though the business combination(s) that
occurred during the current year had occurred as of the beginning of the
comparable prior annual reporting period only. This ASU would also expand the
supplemental pro forma disclosures under Codification Topic 805, Business
Combinations, to include a description of the nature and amount of
material, nonrecurring pro forma adjustments directly attributable to the
business combination.
This proposed ASU would be
effective prospectively for business combinations that are consummated on or
after the beginning of the first annual reporting period beginning on or after
December 15, 2010. Early adoption would be permitted.
Comments on this proposed ASU
are due November 5, 2010
EITF Matters -- September
16, 2010 Meeting Minutes Published
For detail, please contact info@zy-cpa.com
The final meeting minutes of
the September 16, 2010 EITF meeting have been issued. The minutes document the
results previously described in our meeting summary published in September
2010. As discussed in the minutes, the EITF reached final consensuses on EITF
Issue No. 09-G, "Accounting for Costs Associated with Acquiring or
Renewing Insurance Contracts" and EITF Issue No. 10-C, "Reporting
Loans to Participants by Defined Contribution Pension Plans." In addition,
the EITF reached consensuses-for-exposure on the following issues:
-EITF Issue No. 09-H,
"Health Care Entities: Revenue Recognition";
-EITF Issue No. 10-A,
"How the Carrying Amount of a Reporting Unit Should Be Calculated When
Performing Step 1 of the Goodwill Impairment Test"; and
-EITF Issue No. 10-G,
"Disclosure of Supplementary Pro Forma Information for Business
Combinations."
See our discussion above
regarding the FASB's issuance of proposed ASUs for the consensuses-for-exposure reached on Issues
09-H, 10-A, and 10-G.
EITF Materials -- FASB
Issues Materials for November 19, 2010 EITF Meeting
For detail, please contact info@zy-cpa.com
The FASB has issued the
following additional materials for the November 19, 2010 EITF meeting:
-EITF Agenda Report;
-Proposed agenda;
-EITF Issue No. 10-D,
"Accounting for Certain Fees Associated with Recently Enacted Health Care
Legislation" (comment letters on proposed ASU); and
-EITF Issue No. 10-F,
"Accounting for Legal Costs Associated with Medical Malpractice
Claims" (comment letters on proposed ASU).
Repurchase Agreements --
FASB Discusses Repurchase Agreements
For detail, please contact info@zy-cpa.com
As reported in its
"Summary of Board Decisions" publication, the FASB met on October 6,
2010, and discussed amending or removing the “transferor ability” criterion
that is currently considered when determining whether a transferor of financial
assets has maintained effective control for transactions involving repurchase
agreements. The “transferor ability” criterion is the existing requirement that
the transferor is able to repurchase or redeem the financial assets on
substantially the agreed terms, even in the event of default by the transferee.
The FASB made the following tentative decisions:
-To remove the “transferor
ability” criterion and its related application guidance from the effective
control guidance applicable to transactions involving repurchase agreements;
-The proposed guidance to be
issued would be applied prospectively to both new transactions and existing
transactions that are modified after the effective date;
-Early adoption would be
prohibited;
-The final guidance would be
effective as of the beginning of the first interim period after its issuance
and is expected to be issued during the first quarter of 2011; and
-The comment period for the
proposed guidance will end January 15, 2011.
International Accounting
-- Publication Comparing
For detail, please contact info@zy-cpa.com
We have published an updated
version of Comparison between
See our Literature Update for
complete details.
Fair Value Option -- IASB
Discusses Fair Value Option for Financial Liabilities
For detail, please contact info@zy-cpa.com
As reported in its "IASB
Update" publication, the IASB met on October 5, 2010, and discussed the
following topics:
-Fair value option for
financial liabilities;
-Hedge accounting;
-Impairment (financial
instruments); and
-Amendments to IFRS 7, Financial
Instruments: Disclosures.
IFRS for SMEs -- Upcoming Training Workshops and Other Matters
Discussed
For detail, please contact info@zy-cpa.com
The IASB staff has issued
"IFRS for SMEs Update" publication which is
a staff summary of news relating to the International Financial Reporting
Standard for Small and Medium-Sized Entities (IFRS for SMEs).
This update includes discussion of the following topics:
-Upcoming train the trainers
workshops;
-Train the trainers
presentations now available in PowerPoint format;
-Status of translations of
the IFRS for SMEs;
-New IFRS for SMEs training modules available;
-Spanish language translation
of the IFRS for SMEs training modules available;
-Availability of videos about
the IFRS for SMEs;
-New IASB web page on SME
presentations;
-News about adoptions of the
IFRS for SMEs; and
-Where to obtain IFRS for SMEs materials.
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:
=======================================
Work of Other Auditors --
PCAOB Staff Interpretive Guidance Discussed
For detail, please contact info@zy-cpa.com
We have added a GAAS Update
Service that provides discussion and analysis of PCAOB Staff Audit Practice
Alert No. 6, Auditor Considerations Regarding Using the Work of Other
Auditors and Engaging Assistants from Outside the Firm. This alert was
issued as a result of observations in PCAOB inspections that some U.S.-based
firms issuing audit reports based on work performed by others outside the
Compilation and Reviews --
New Edition of Knowledge-Based Compilations and Reviews Published
For detail, please contact info@zy-cpa.com
We have published the 2010
edition of Knowledge-Based Compilations and Reviews. 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
edition of the publication includes revisions and updates to reflect current
authoritative literature and, among other things, AICPA Statements on Standards
for Accounting and Review Services No. 19, Compilation and Review
Engagements.
See our Literature Update for
complete details.
PCAOB Registration --
PCAOB Addresses Registration Applications From Firms
in Non-U.S. Jurisdictions
For detail, please contact info@zy-cpa.com
As discussed above in our
Accounting and SEC Summaries, the PCAOB published a release, Consideration
of Registration Applications from Public Accounting Firms in Non-U.S.
Jurisdictions Where There Are Unresolved Obstacles to PCAOB Inspections.
This release addresses registration applications from firms in non-U.S.
jurisdictions where, because of asserted legal restrictions or objections of
local authorities, the PCAOB is denied access to information from
PCAOB-registered firms that is necessary to inspect those firms. Effective for
all pending and future applications from accounting firms in such
jurisdictions, the PCAOB will ask the applicant to state its understanding of
whether a PCAOB inspection of the firm would currently be allowed by local law
or local authorities. The applicant may choose to keep its application pending
until it can respond, with confirmation from the appropriate authority in the
jurisdiction, that PCAOB inspection is permitted. If the applicant, in order to
obtain earlier action on its application, responds that PCAOB inspection would
not currently be allowed, the PCAOB will issue a "Notice of Hearing"
to consider whether, in light of the obstacle to inspection, approval of the
application would be consistent with the PCAOB's
responsibility under the Sarbanes-Oxley Act of 2002.
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:
======================
Yellow Book -- GAO
Exposure Draft Discussed
For detail, please contact info@zy-cpa.com
We have added a Governmental
GAAP Update Service that discusses the Government Accountability Office (GAO)
publication of an Exposure Draft (ED) proposing changes to Government Auditing
Standards (GAGAS). The proposed revision to GAGAS, commonly known as the
“Yellow Book,” will be the sixth since the GAO first issued the standards in
1972. The proposed changes contained in the ED update the Yellow Book to
reflect major developments in the audit profession and emphasize specific
considerations applicable to the government environment. This Update discusses:
(a) proposed major changes to GAGAS; and (b) questions being
asked in the ED.
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