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Accounting Research Manager®
Weekly Summary of Developments
May 16-20, 2011
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Accounting Research Manager
subscriber,
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of this week's Weekly Summary.
Accounting and SEC
Headlines
Off-Balance Sheet
Activities -- IASB
Issues Guidance on Off-Balance Sheet Activities and Joint Arrangements
Accounting
Balance Sheet Offsetting -- Boards Discuss Balance Sheet
Offsetting and Other Matters
Insurance Contracts -- IASB and FASB Discuss Insurance
Contracts
Fair Value Measurement -- IASB Issues Guidance on Fair
Value Measurement
Contingent Pricing -- IFRS Interpretations Committee
Discusses Contingent Pricing and Other Matter
New Accounting Standards -- Checklist Updated
Government Headlines
GASB Report Issued -- Financial Guarantees Project
Added to Technical Agenda
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ACCOUNTING AND SEC HEADLINES:
=============================
Off-Balance Sheet
Activities -- IASB Issues Guidance on Off-Balance Sheet Activities and Joint
Arrangements Accounting
The IASB has announced the
completion of its review of accounting treatment for off-balance-sheet
activities. The IASB believes that this process broadly brings IFRSs and U.S. GAAP into alignment, and concludes an
important element of the IASB’s comprehensive
response to the financial crisis. As a result of this review, the IASB has
issued the following new and (or) amended standards:
-IFRS 10, Consolidated
Financial Statements;
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-IFRS 11, Joint
Arrangements;
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-IFRS 12, Disclosure of
Interests in Other Entities;
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-IAS 27, Separate Financial
Statements (as amended in 2011); and
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-IAS 28, Investments in
Associates and Joint Ventures (as amended in 2011).
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IFRS 10 builds on existing
principles by identifying the concept of control as the determining factor in
whether an entity should be included within the consolidated financial
statements of the parent company. The standard provides additional guidance to
assist in the determination of control where this is difficult to assess. IFRS
10 supersedes IAS 27, Consolidated and Separate Financial Statements (as
amended in 2008) 
and SIC 12, Consolidation - Special Purpose
Entities.
IFRS 11 is intended to provide
for a more realistic reflection of joint arrangements by focusing on the rights
and obligations of the arrangement, rather than its legal form (as is currently
the case). The standard addresses inconsistencies in the reporting of joint
arrangements by requiring a single method to account for interests in jointly
controlled entities. IFRS 11 supersedes IAS 31, Interests in Joint Ventures
and SIC 13, Jointly Controlled Entities - Non-Monetary Contributions by Venturers.
IFRS 12 is a new standard on
disclosure requirements for all forms of interests in other entities, including
joint arrangements, associates, special purpose vehicles, and other
off-balance-sheet vehicles.
IAS 27, as amended in 2011,
contains accounting and disclosure requirements for investments in
subsidiaries, joint ventures, and associates when an entity prepares separate
financial statements. The standard requires an entity preparing separate
financial statements to account for those investments at cost or in accordance
with IFRS 9, Financial Instruments. In completing IFRS 10, the IASB
removed from IAS 27 all requirements relating to consolidated financial
statements.
IAS 28, as amended in 2011,
prescribes the accounting for investments in associates and sets out the
requirements for the application of the equity method when accounting for
investments in associates and joint ventures.
The new and amended standards
are effective for annual periods beginning on or after January 1, 2013. Earlier
application is permitted. If the standards are applied early, an entity should
disclose that fact and apply IFRS 10, IFRS 11, IFRS 12, IAS 27 (as amended in
2011), and IAS 28 (as amended in 2011) at the same time. An entity can,
however, provide the information required by IFRS 12 early without complying
with all of the requirements of IFRS 12 or applying IFRS 10, IFRS 11, IAS 27
(as amended in 2011), and IAS 28 (as amended in 2011) early.
Balance Sheet Offsetting --
Boards Discuss Balance Sheet Offsetting and Other Matters
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As reported in its
"Summary of Board Decisions" publication, the FASB and IASB (the
Boards) met on May 17-19, 2011, and discussed the following topics:
-Balance sheet offsetting;
-Insurance contracts;
-Revenue recognition;
-Leases; and
-Impairment of financial
instruments.
Regarding their project on
balance sheet offsetting, the Boards discussed feedback received on their
exposure drafts and instructed the staff to provide analyses of various issues
raised by stakeholders for future deliberations, including simultaneous
settlement, collateral, and unit of account.
Insurance Contracts -- IASB
and FASB Discuss Insurance Contracts
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As reported in its "IASB
Update" publication, the Boards met on May 11-12, 2011, and discussed
insurance contracts and revenue recognition. In a separate session, the IASB
met and discussed leases, insurance contracts, and its Exposure Draft, Hedge
Accounting. In connection with the hedge accounting project, the IASB
tentatively decided to make certain clarifications to the proposed guidance in
the ED to address concerns raised in comment letters and various outreach
activities.
Fair Value Measurement --
IASB Issues Guidance on Fair Value Measurement
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The IASB has issued IFRS 13, Fair
Value Measurement. The issuance of IFRS 13 corresponds to the FASB’s
Accounting Standards Update (ASU) No. 2011-04, Fair Value Measurement (Topic
820): Amendments to Achieve Common Fair Value Measurement and Disclosure
Requirements in
The main provisions of IFRS 13
include the following:
-Defining fair value;
-Setting out in a single
standard a framework for measuring fair value; and
-Requiring certain disclosures
about fair value measurements.
IFRS 13 applies when another
IFRS requires or permits fair value measurements or disclosures about fair
value measurements, except in specified circumstances. The new standard also
applies to measurements (e.g., fair value less costs to sell) based on fair
value, or disclosures about those measurements.
The guidance in IFRS 13
describes how to measure fair value for financial reporting. It does not
require fair value measurements in addition to those already required or
permitted by other IFRSs and is not intended to
establish valuation standards or affect valuation practices outside financial
reporting.
IFRS 13 is to be applied for
annual periods beginning on or after January 1, 2013. Earlier application is
permitted.
Contingent Pricing -- IFRS
Interpretations Committee Discusses Contingent Pricing and Other Matters
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As reported in its "IFRIC
Update" publication, the IFRS Interpretations Committee met on May 5-6,
2011, and discussed the following topics:
-Current agenda (contingent
pricing and stripping costs);
-IFRS Interpretations
Committee tentative agenda decisions;
-Issues considered for Annual
Improvements project; and
-Work in progress.
New Accounting Standards --
Checklist Updated
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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 checklist is updated shortly after the FASB
adds or revises content in the FASB Accounting Standards CodificationTM (Codification). 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 our checklist
to reflect the issuance of Codification Maintenance Update 2011-07. This update
represents a “roll-off” of transition guidance related to Accounting Standards
Update (ASU) No. 2009-16, Transfers and Servicing (Topic 860): Accounting
for Transfers of Financial Assets.That ASU amended the Codification for the issuance of
FASB Statement No. 166, Accounting for Transfers of Financial Assets - an
amendment of FASB Statement No. 140.
See our Literature Update for
complete details.
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listed above may not be accessible under your current subscription. For
information about upgrading your subscription to include additional content,
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======================
GOVERNMENT HEADLINES:
======================
GASB Report Issued --
Financial Guarantees Project Added to Technical Agenda
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The April 2011 edition of the
"GASB Report" has been issued and includes the following discussion
items:
-GASB calendar;
-Project on financial
guarantees;
-Summary of recent GASB
meetings;
-Technical plan for the second
four months of 2011;
-Current agenda projects;
-Practice issues;
-Research projects; and
-AICPA working draft guide on
health care entities.
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@hkcmcpa.us