===================================================
Accounting Research
Manager(TM)
Weekly Summary of
Developments
November 29 - December 3,
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
Troubled Debt Disclosures -- FASB Discusses Deferral of Troubled
Debt Restructuring Disclosures and Other Matters
Smaller Issuers -- SEC Staff Publishes Presentation on
Review of Common Financial Reporting Issues Facing Smaller Issuers
Risk Alerts -- AICPA Issues Audit Risk Alerts
Conceptual Framework -- IASB and FASB Discuss Conceptual
Framework and Other Matters
Auditing and Internal
Controls Headlines
Financial Institutions -- 2011 Edition of Knowledge-Based Audits
of Financial Institutions Published
SSARS Guidance -- AICPA Publishes Proposed SSARS
Guidance
Knowledge-Based Audits -- Updated Editions Published
Risk Alerts -- AICPA Issues Audit Risk Alerts
Government Headlines
Deferred Outflows and
Inflows -- GASB Issues
Proposal on Reporting Deferred Outflows, Inflows, and Net Position
=============================
ACCOUNTING AND SEC HEADLINES:
=============================
Troubled Debt Disclosures
-- FASB Discusses Deferral of Troubled Debt Restructuring Disclosures and Other
Matters
For detail, please contact info@zy-cpa.com
As reported in its
"Summary of Board Decisions" publication, the FASB met on December 1,
2010, and discussed the following topics:
-Deferral of troubled debt restructuring disclosures;
-FASB ratification of EITF
decisions;
-Investment properties; and
-Risks and uncertainties
(formerly going concern).
The Acting FASB Chairman
announced that a project had been added to the agenda to reconsider the
effective date for required disclosures about troubled debt restructurings, as
described in Accounting Standards Update (ASU) No. 2010-20, Receivables
(Topic 310): Disclosures about the Credit Quality of Financing Receivables and
the Allowance for Credit Losses. The FASB decided to propose a change to
the effective date of those disclosures to make it concurrent with the
effective date of proposed guidance for identifying a troubled debt
restructuring. The FASB published proposed clarifications to the guidance used
to identify a troubled debt restructuring in October 2010 and expects to publish
a final ASU in the first quarter of 2011. The FASB directed its staff to draft
a proposal to change the effective date of the troubled debt restructuring
disclosures for vote by written ballot.
The FASB also approved
decisions reached at the November 19, 2010 EITF meeting on the following
issues:
-EITF Issue 09-H,
"Health Care Entities: Presentation and Disclosure of Net Patient Service
Revenue, Provision for Bad Debts, and the Allowance for Doubtful
Accounts";
-EITF Issue 10-A, "When
to Perform Step 2 of the Goodwill Impairment Test for Reporting Units with Zero
or Negative Carrying Amounts";
-EITF Issue 10-D, "Fees
Paid to the Federal Government by Pharmaceutical Manufacturers";
-EITF Issue 10-G,
"Disclosure of Supplementary Pro Forma Information for Business
Combinations"; and
-EITF Issue 10-H, "Fees
Paid to the Federal Government by Health Insurers."
Issues 09-H, 10-A, 10-D, and
10-G are final consensuses that will result in ASUs,
scheduled for issuance in 2010. Issue 10-H is a consensus-for-exposure that is
also scheduled for release in 2010. For complete details, see our "EITF
Flash Report" covering the November 19, 2010 EITF meeting.
Smaller Issuers -- SEC
Staff Publishes Presentation on Review of Common Financial Reporting Issues
Facing Smaller Issuers
For detail, please contact info@zy-cpa.com
The staff in the Division of
Corporation Finance (Corp Fin) of the SEC has published a presentation,
"SEC Staff Review of Common Financial Reporting Issues Facing Smaller
Issuers." This presentation provides a sampling of issues that the Corp
Fin staff frequently encounter when reviewing filings for smaller public companies
as well as an overview of developments within Corp Fin. Topics covered in the
presentation are:
-Overview of Corp Fin;
-Recent developments within
Corp Fin;
-The comment letter process;
-Financial reporting issues
frequently raised in comment letters; and
-Resources available to
issuers regarding Corp Fin and the comment letter process.
Financial reporting issues
frequently raised in comment letters discussed in the presentation include the
following broad topic areas:
-Management’s Discussion
& Analysis;
-Reverse mergers and “back
door” registrations;
-Business combinations;
-Goodwill, intangible and
long-lived assets;
-Predecessor financial
statements;
-Equity transactions;
-Embedded conversion options
and freestanding warrants; and
-Revenue recognition.
Risk Alerts -- AICPA
Issues Audit Risk Alerts
The AICPA has issued the
following Audit Risk Alerts:
-Investment Companies
Industry Developments - 2010/11;
For detail, please contact info@zy-cpa.com
-Insurance Industry
Developments - 2010/11;
For detail, please contact info@zy-cpa.com
-Financial Institutions
Industry Developments - 2010/11: Including Depository and Lending Institutions
and Brokers and Dealers in Securities; and
For detail, please contact info@zy-cpa.com
-Health Care Industry
Developments - 2010/11.
For detail, please contact info@zy-cpa.com
These Alerts are intended to
provide auditors of financial statements with an overview of recent economic,
industry, technical, regulatory, and professional developments that may affect
the audits and other engagements they perform. Topics covered in these Alerts
include: (a)regulatory activities; (b)economic and industry
developments or trends; (c)recent auditing and attestation
pronouncements and related guidance; (d)recent AICPA independence and
ethics pronouncements; and (e)future or emerging issues to monitor.
Conceptual Framework --
IASB and FASB Discuss Conceptual Framework and Other Matters
For detail, please contact info@zy-cpa.com
As reported in its "IASB
Update" publication, the IASB and FASB met on November 16-18, 2010, and
discussed the following topics:
-Conceptual framework;
-Asset and liability
offsetting;
-Emissions trading schemes;
-Fair value measurement;
-Financial instruments:
impairment (education session);
-Other comprehensive income;
and
-Revenue recognition.
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 --
2011 Edition of Knowledge-Based Audits of Financial Institutions Published
For detail, please contact info@zy-cpa.com
We have published a new
publication, the 2011 edition of Knowledge-Based Audits of Financial
Institutions. This guide is designed to help the auditor efficiently and
effectively perform financial statement audits of many financial institutions
in accordance with auditing standards generally accepted in the
-AICPA Statement on Auditing
Standards (SAS) No. 118, Other Information in Documents Containing Audited
Financial Statements;
-SAS No. 119, Supplementary
Information in Relation to the Financial Statements as a Whole; and
-SAS No. 120, Required
Supplementary Information.
This guide also includes an
overview of the legal and regulatory environment with discussions of laws and
regulations applicable to the financial services industry including the
"Dodd-Frank Wall Street Reform and Consumer Protection Act"
(Dodd-Frank Act). For further information on the Dodd-Frank Act, see our previously
published discussion and analysis in our publication "A Closer Look."
See our Literature Update for
complete details.
SSARS Guidance -- AICPA
Publishes Proposed SSARS Guidance
For detail, please contact info@zy-cpa.com
The AICPA has published an
exposure draft of a proposed Statement on Standards for Accounting and Review
Services (SSARS), The Use of the Accountant’s Name in a Document or
Communication Containing Unaudited Financial
Statements That Have Not Been Compiled or Reviewed. This proposal includes
guidance to address the accountant’s responsibilities when he or she permits
the use of his or her name in a document or written communication containing unaudited financial statements that have not been compiled
or reviewed. Specifically, this proposal would establish a:
-Requirement that the
accountant read the financial statements and other information in the document
and consider whether such financial statements and other information appears
free from obvious material misstatements and from material inconsistencies with
other knowledge or information that the accountant may have obtained; and
-Nonreporting
option provided that the accountant requests that the client clearly indicate
that the unaudited financial statements were not
compiled or reviewed by the accountant.
As proposed, this guidance
would be effective for unaudited financial statements
that have not been compiled or reviewed for periods ending on or after December
15, 2011.
Comments on this proposal are
due April 29, 2011.
Knowledge-Based Audits --
Updated Editions Published
We have published the 2011 editions of the
following publications:
-Knowledge-Based Audits of
Commercial Entities tool; and
For detail, please contact info@zy-cpa.com
-Knowledge-Based Audit
Procedures guide.
For detail, please contact info@zy-cpa.com
These publications are
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
-SAS No. 118, Other
Information in Documents Containing Audited Financial Statements;
-SAS No. 119, Supplementary
Information in Relation to the Financial Statements as a Whole; and
-SAS No. 120, Required
Supplementary Information.
In addition, these
publications include a discussion regarding the status of the AICPA Auditing
Standards Board's Auditing Standards Clarity Project. The AICPA’s
Clarity Project is intended to make existing U.S. generally accepted auditing
standards (GAAS) easier to understand, apply, and move toward converging U.S.
GAAS with International Standards on Auditing issued by the International
Auditing and Assurance Standards Board. For further information on the AICPA's Clarity Project, see our previously published
discussion and analysis in our publication "A Closer Look."
See our Literature Updates
for complete details.
Risk Alerts -- AICPA
Issues Audit Risk Alerts
As discussed above in our
Accounting and SEC Summaries, the AICPA has issued the following Audit Risk
Alerts:
-Investment Companies
Industry Developments - 2010/11;
For detail, please contact info@zy-cpa.com
-Insurance Industry
Developments - 2010/11;
For detail, please contact info@zy-cpa.com
-Financial Institutions
Industry Developments - 2010/11: Including Depository and Lending Institutions
and Brokers and Dealers in Securities; and
For detail, please contact info@zy-cpa.com
-Health Care Industry
Developments - 2010/11.
For detail, please contact info@zy-cpa.com
These Alerts are intended to
provide auditors of financial statements with an overview of recent economic,
industry, technical, regulatory, and professional developments that may affect
the audits and other engagements they perform. Topics covered in these Alerts
include: (a)regulatory activities; (b)economic and industry
developments or trends; (c)recent auditing and attestation
pronouncements and related guidance; (d)recent AICPA independence and
ethics pronouncements; and (e)future or emerging issues to monitor.
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:
======================
Deferred Outflows and
Inflows -- GASB Issues Proposal on Reporting Deferred Outflows, Inflows, and
Net Position
For detail, please contact info@zy-cpa.com
The GASB has issued for
public comment an exposure draft of a proposed Statement, Financial
Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources, and
Net Position. This proposal would provide financial reporting guidance for
deferred outflows of resources and deferred inflows of resources. GASB Concepts
Statement No. 4, Elements of Financial Statements, introduced and
defined those elements as a consumption of resources of net assets by the
government that is applicable to a future reporting period, and an acquisition
of net assets by the government that is applicable to a future reporting
period, respectively. Existing financial reporting standards do not include
guidance for reporting those financial statement elements, which are distinct
from assets and liabilities.
As proposed, the guidance in
this Statement would be effective for financial statements for periods
beginning after June 15, 2011. Earlier application would be encouraged.
Comments on this proposal are
due February 25, 2011.
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