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Accounting Research
Manager(TM)
Weekly Summary of
Developments
December 13-17, 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
Derivatives and Hedging -- Interpretations of US GAAP Updated
Rule Making Proposals -- SEC Proposes New Rules Resulting From
Dodd-Frank Act
Financial Institutions -- SEC Staff Publishes Presentation on
Areas of Frequent Staff Comment for Financial Institutions
Broker-Dealer Audits -- PCAOB Proposes Rules Resulting From
Dodd-Frank Act
Fair Value Measurement -- FASB and IASB Discuss Fair Value
Measurement and Other Matters
Amortized Cost and
Impairment -- IASB and
FASB Discuss Accounting for Credit Impairment
Income Taxes -- IASB Discuss Accounting for Income
Taxes
IFRS for SMEs
-- IFRS for SMEs Print Edition and Other Matters
Discussed
Auditing and Internal
Controls Headlines
Broker-Dealer Audits -- PCAOB Proposes Rules Resulting From
Dodd-Frank Act
Employee Benefit Plans -- New Edition of Knowledge-Based Audits
Published
Compilation and Reviews -- New Edition of Knowledge-Based Audits
Published
Government Headlines
GASB Report Issued -- Statement of Net Position and Other
Matters Discussed
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ACCOUNTING AND SEC HEADLINES:
=============================
Derivatives and Hedging -- Interpretations of US GAAP Updated
For detail, please contact info@zy-cpa.com
We have revised our
publication, Derivatives and Hedging - Interpretations of
-FASB Accounting Standards
Update (ASU) No. 2010-24, Health Care Entities (Topic 954): Presentation of
Insurance Claims and Related Insurance Recoveries (a consensus of the FASB
Emerging Issues Task Force); and
-FASB Editorial and
Maintenance Update No. 2010-19.
See our Literature Update for
complete details.
Rule Making Proposals -- SEC Proposes New Rules Resulting
From Dodd-Frank Act
The SEC has issued for public
comment the following proposed rules:
-Disclosure of Payments by
Resource Extraction Issuers (Proposal 1);
For detail, please contact info@zy-cpa.com
-Mine Safety Disclosure
(Proposal 2); and
For detail, please contact info@zy-cpa.com
-Conflict Minerals
(Proposal 3).
For detail, please contact info@zy-cpa.com
Proposal 1 includes
amendments to SEC rules pursuant to Section 1504 of the Dodd-Frank Wall Street
Reform and Consumer Protection Act (Dodd-Frank Act) relating to disclosure of
payments by resource extraction issuers. Section 1504 added Section 13(q) to
the Securities Exchange Act of 1934, which requires the SEC to issue rules
requiring resource extraction issuers to include in an annual report
information relating to any payment made by the issuer, or by a subsidiary or
another entity controlled by the issuer, to a foreign government or the Federal
Government for the purpose of the commercial development of oil, natural gas,
or minerals. Section 13(q) requires a resource extraction issuer to provide
information about the type and total amount of payments made for each project
related to the commercial development of oil, natural gas, or minerals, and the
type and total amount of payments made to each government. In addition, Section
13(q) requires a resource extraction issuer to provide certain information
regarding those payments in an interactive data format, as specified by the
SEC.
Proposal 2 includes
amendments to SEC rules to implement Section 1503 of the Dodd-Frank Act.
Section 1503(a) requires issuers that are operators,
or that have a subsidiary that is an operator, of a coal or other mine to
disclose in their periodic reports filed with the SEC information regarding
specified health and safety violations, orders and citations, related
assessments and legal actions, and mining-related fatalities. Section 1503(b)
of the Dodd-Frank Act mandates the filing of a Form 8-K disclosing the receipt
of certain orders and notices from the Mine Safety and Health Administration.
Proposal 3 includes changes
to the annual reporting requirements of certain issuers that file reports to
implement Section 1502 of the Dodd-Frank Act. This proposal would require any
issuer for which conflict minerals are necessary to the functionality or
production of a product manufactured, or contracted to be manufactured, by that
issuer to disclose in the body of its annual report whether its conflict
minerals originated in the Democratic Republic of the Congo or an adjoining
country. If so, that issuer would be required to furnish a separate report as
an exhibit to its annual report that includes, among other matters, a
description of the measures taken by the issuer to exercise due diligence on
the source and chain of custody of its conflict minerals. These due diligence
measures would include, but would not be limited to, an independent private
sector audit of the issuer’s report conducted in accordance with standards
established by the Comptroller General of the
Comments on each of these
proposals are due January 31, 2011.
Financial Institutions -- SEC Staff Publishes Presentation on
Areas of Frequent Staff Comment for Financial Institutions
For detail, please contact info@zy-cpa.com
Corp Fin has published a
presentation, Areas of Frequent Staff Comment - Financial Institutions.
This presentation provides an overview of issues that Corp Fin staff frequently
encounter when reviewing filings for financial institutions. In addition, this
presentation includes suggestions for enhanced disclosure of these issues in
Management’s Discussion and Analysis. Frequent areas of staff comment covered
in this presentation, among other items, include:
-Asset quality and loan
accounting;
-Securities impairments;
-Goodwill impairment;
-Deferred tax asset
valuation;
-Loss contingencies;
-Mortgage and
foreclosure-related matters; and
-Liquidity and risk
management.
Broker-Dealer Audits -- PCAOB Proposes Rules Resulting From
Dodd-Frank Act
The PCAOB has issued for
public comment the following two proposed rules:
-Proposed Temporary Rule
for an Interim Program of Inspection Related to Audits of Brokers and Dealers
(Proposal 1); and
For detail, please contact info@zy-cpa.com
-Proposal for Allocation
of the Board's Accounting Support Fee Among Issuers, Brokers, And Dealers, and
Other Amendments to the Board's Funding Rules (Proposal 2).
For detail, please contact info@zy-cpa.com
These proposals include rules
implementing certain provisions of the Dodd-Frank Act regarding the PCAOB's expanded oversight authority over the audits of
broker-dealers. Proposal 1 includes a temporary rule to establish an interim
inspection program related to audits of broker-dealers. According to the PCAOB,
the temporary rule would serve two principal purposes:
-Allow the PCAOB to assess
registered public accounting firms’ current compliance with laws, rules, and
standards in performing audits with respect to broker-dealers; and
-Inform the PCAOB's decisions about significant elements of a permanent
inspection program, including whether to differentiate among classes of
broker-dealers, whether to exempt any categories of public accounting firms,
and what minimum inspection frequency schedules to establish.
Under the temporary rule in
Proposal 1, the PCAOB would begin to inspect auditors of brokers and dealers
and identify and address with the registered firms any significant issues in
those audits. During the interim program, the PCAOB would provide, at least
annually, public reports on the progress of the interim program and significant
issues identified. However, the PCAOB does not expect to issue firm-specific
inspection reports before the scope of a permanent program is set. The proposed
temporary rule would not change anything about the rules or standards that
govern audits of broker-dealers. As the SEC has previously stated, its rules
continue to require those audits to be carried out under GAAS.
Proposal 2 includes
amendments to the PCAOB's funding rules to provide
for the equitable allocation and assessment among broker-dealers of the
appropriate portion of the accounting support fee established under the
Sarbanes-Oxley Act of 2002, as amended by the Dodd-Frank Act. The proposed
amendments would also make certain revisions to the PCAOB's
existing rules for the allocation among issuers of the accounting support fee.
Certain issuers, brokers, and dealers would be affected by the proposed
amendments to the PCAOB's funding rules.
Comments on both proposals
are due February 15, 2011.
Fair Value Measurement -- FASB and IASB Discuss 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) met on December 14-16, 2010, and discussed the following topics:
-Fair value measurement;
-Revenue recognition;
-Balance sheet: offsetting;
-Insurance contracts;
-Accounting for financial
instruments: hedge accounting; and
-Accounting for financial
instruments: impairment.
The Boards discussed
measuring the fair value of a liability issued with an inseparable third-party
credit enhancement and tentatively decided that the requirements for measuring
the fair value of a liability issued with an inseparable third-party credit
enhancement:
-Only apply to guarantees
purchased by the issuer of the liability; and
-Do not apply to liabilities
guaranteed by other entities within the consolidated or combined group.
The IASB also tentatively
decided that an entity would be required to disclose the existence of a
third-party credit enhancement of a liability it has issued, as is currently
required by U.S. GAAP. The Boards also tentatively decided that the disclosures
an entity is required to make about fair value measurements also apply to
fair-value-based measurements.
Amortized Cost and
Impairment -- IASB and
FASB Discuss Accounting for Credit Impairment
For detail, please contact info@zy-cpa.com
As reported in its "IASB
Update" publication, the Boards met on December 8, 2010, and discussed
amortized cost and impairment. Specifically, the Boards continued their
discussions of three methods of accounting for credit impairment.
Income Taxes -- IASB Discuss Accounting for Income
Taxes
For detail, please contact info@zy-cpa.com
As reported in its "IASB
Update" publication, the IASB met on December 3, 2010, and discussed the
accounting for income taxes. Specifically, the IASB discussed comments received
from constituents on its Exposure Draft, Deferred Tax: Recovery of
Underlying Assets.
IFRS for SMEs -- IFRS for SMEs Print
Edition 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:
-Initial print run of IFRS
for SMEs sold out;
-World Bank web pages on IFRS
for SMEs;
-Upcoming train the trainers
workshops in Kazakhstan and Singapore;
-Armenian, Chinese and French
translations of the IFRS for SMEs are posted;
-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:
=======================================
Broker-Dealer Audits -- PCAOB Proposes Rules Resulting From
Dodd-Frank Act
As discussed above in our
Accounting and SEC Summaries, the PCAOB has issued for public comment the
following two proposed rules:
-Proposed Temporary Rule
for an Interim Program of Inspection Related to Audits of Brokers and Dealers
(Proposal 1); and
For detail, please contact info@zy-cpa.com
-Proposal for Allocation
of the Board's Accounting Support Fee Among Issuers, Brokers, And Dealers, and
Other Amendments to the Board's Funding Rules (Proposal 2).
For detail, please contact info@zy-cpa.com
These proposals include rules
implementing certain provisions of the Dodd-Frank Act regarding the PCAOB's expanded oversight authority over the audits of
broker-dealers. Proposal 1 includes a temporary rule to establish an interim
inspection program related to audits of broker-dealers. According to the PCAOB,
the temporary rule would serve two principal purposes:
-Allow the PCAOB to assess
registered public accounting firms’ current compliance with laws, rules, and
standards in performing audits with respect to broker-dealers; and
-Inform the PCAOB's decisions about significant elements of a permanent
inspection program, including whether to differentiate among classes of
broker-dealers, whether to exempt any categories of public accounting firms,
and what minimum inspection frequency schedules to establish.
Under the temporary rule in
Proposal 1, the PCAOB would begin to inspect auditors of brokers and dealers
and identify and address with the registered firms any significant issues in
those audits. During the interim program, the PCAOB would provide, at least
annually, public reports on the progress of the interim program and significant
issues identified. However, the PCAOB does not expect to issue firm-specific
inspection reports before the scope of a permanent program is set. The proposed
temporary rule would not change anything about the rules or standards that
govern audits of broker-dealers. As the SEC has previously stated, its rules
continue to require those audits to be carried out under GAAS.
Proposal 2 includes
amendments to the PCAOB's funding rules to provide
for the equitable allocation and assessment among broker-dealers of the
appropriate portion of the accounting support fee established under the
Sarbanes-Oxley Act of 2002, as amended by the Dodd-Frank Act. The proposed
amendments would also make certain revisions to the PCAOB's
existing rules for the allocation among issuers of the accounting support fee.
Certain issuers, brokers, and dealers would be affected by the proposed
amendments to the PCAOB's funding rules.
Comments on both proposals
are due February 15, 2011.
Employee Benefit Plans -- New Edition of Knowledge-Based
Audits Published
For detail, please contact info@zy-cpa.com
We have published the 2011
edition of Knowledge-Based Audits of Employee Benefit Plans. This
publication is designed to help the auditor efficiently and effectively perform
financial statement audits of employee benefit plans in accordance with auditing
standards generally accepted in the United States (GAAS). This edition of the
publication includes revisions and updates to reflect current authoritative
literature and, among other things, auditing pronouncements through:
-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.
See our Literature Update for
complete details.
Compilation and Reviews -- New Edition of Knowledge-Based
Audits Published
For detail, please contact info@zy-cpa.com
We have published the 2011
edition of Knowledge-Based Compilations and 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 of the publication includes revisions and updates to reflect current
authoritative literature and, among other things, pronouncements through:
-AICPA Statement on Standards
for Accounting and Review Services (SSARS) No. 18, Applicability of
Statements on Standards for Accounting and Review Services; and
-SSARS No. 19, 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
======================
GOVERNMENT HEADLINES:
======================
GASB Report Issued -- Statement of Net Position and Other
Matters Discussed
For detail, please contact info@zy-cpa.com
The November 2010 edition of
the "GASB Report" has been issued and includes the following
discussion items:
-GASB calendar;
-Statement of net position
exposure draft approved;
-GASB Statement No. 60, Accounting
and Financial Reporting for Service Concession Arrangements, and GASB
Statement No. 61, The Financial Reporting Entity: Omnibus, approved for
issuance;
-Summary of recent
Governmental Accounting Standards Advisory Council meetings; and
-GASB holds public hearings
on pension preliminary views.
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