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Accounting Research Manager®
Weekly Summary of Developments
July 25-29, 2011
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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:
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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
Health Care Entities -- FASB Issues Guidance for Health
Care Entities
New Accounting Standards -- Checklist Updated
Derivatives and Hedging -- Interpretation Updated
Retirement Plans -- FASB Discusses Retirement Plan
Disclosures and Other Matters
Offsetting -- IASB and FASB Discuss Asset and
Liability Offsetting and Other Matters
Asset-Backed Securities -- SEC Re-Proposes Shelf
Eligibility Conditions for Asset-Backed Securities
SEC Regulations Committee -- CAQ SEC Regulations Committee
Minutes Issued
International Accounting -- CAQ International Practices Task
Force Minutes Issued
Government Auditing
Standards -- AICPA
Publishes Audit Risk Alert
Auditing and Internal
Controls Headlines
Real Estate -- New Edition of
Knowledge-Based Audits of Real Estate Published
Subsequent Events -- AICPA Clarified Statement on
Auditing Standards Discussed
Government Auditing
Standards -- AICPA
Publishes Audit Risk Alert
Government Headlines
Service Concession
Arrangements --
GASB 60 Discussed
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ACCOUNTING AND SEC HEADLINES:
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Health Care Entities --
FASB Issues Guidance for Health Care Entities
For detail, please contact info@hkcmcpa.us
The FASB has issued Accounting
Standards Update (ASU) No. 2011-07, Health Care Entities (Topic 954):
Presentation and Disclosure of Patient Service Revenue, Provision for Bad
Debts, and the Allowance for Doubtful Accounts for Certain Health Care
Entities. The ASU represents a consensus of the EITF on Issue No. 09-H,
“Health Care Entities: Presentation and Disclosure of Net Revenue, Provision
for Bad Debts, and the Allowance for Doubtful Accounts.”
The amendments in this ASU
require certain health care entities to change the presentation in their
statement of operations by reclassifying the provision for bad debts associated
with patient service revenue from an operating expense to a deduction from
patient service revenue (net of contractual allowances and discounts). Additionally,
those health care entities are required to provide enhanced disclosure about
their policies for recognizing revenue and assessing bad debts. The amendments
also require disclosures of patient service revenue (net of contractual
allowances and discounts) as well as qualitative and quantitative information
about changes in the allowance for doubtful accounts.
For public entities, the
amendments in this ASU are effective for fiscal years and interim periods
within those fiscal years beginning after December 15, 2011, with early
adoption permitted. For nonpublic entities, the amendments are effective for
the first annual period ending after December 15, 2012, and interim and annual
periods thereafter, with early adoption permitted. The amendments to the
presentation of the provision for bad debts related to patient service revenue
in the statement of operations should be applied retrospectively to all prior
periods presented. The disclosures required by the amendments in this ASU
should be provided for the period of adoption and subsequent reporting periods.
New Accounting Standards --
Checklist Updated
For detail, please contact info@hkcmcpa.us
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 ASU 2011-07, discussed above.
See our Literature Update for
complete details.
Derivatives and Hedging --
Interpretation Updated
For detail, please contact info@hkcmcpa.us
We have revised our
publication, Derivatives and Hedging - Interpretations of U.S. GAAP, to
reflect amendments of the Codification through ASU No. 2011-05, Comprehensive
Income (Topic 220): Presentation of Comprehensive Income, and FASB
Editorial and Maintenance Update No. 2011-11. We have added interpretations to:
(a) affirm that the regular-way exception is mandatory, not elective;
and (b) clarify that the probability thresholds for recognition (i.e.,
deferral) and derecognition of amounts under a cash
flow hedge differ.
See our Literature Update for
complete details.
Retirement Plans -- FASB
Discusses Retirement Plan Disclosures and Other Matters
For detail, please contact info@hkcmcpa.us
As reported in its
"Summary of Board Decisions" publication, the FASB met on July 27,
2011, and discussed disclosures about an employer's participation in a
multiemployer plan. The FASB approved revisions to the proposed ASU, Compensation
-- Retirement Benefits -- Multiemployer Plans (Subtopic 715-80): Disclosure
about an Employer’s Participation in a Multiemployer Plan. The proposed ASU
and the FASB’s related revisions are intended to provide more information about
an employer’s financial obligations to multiemployer pension plans.
Multiemployer pension plans are commonly used by an employer to provide
benefits to union employees who may work for many employers during their
working life, in order to enable them to accrue benefits in a single pension
plan.
Currently, employers are
required to disclose only their total contributions to all multiemployer plans
in which they participate.
The new disclosures announced
by the FASB include:
-The amount of employer
contributions made to each significant plan and to all plans in the aggregate;
-An indication of whether the
employer’s contributions represent more than 5% of total contributions to the
plan;
-An indication of which plans,
if any, are subject to a funding improvement plan;
-The expiration date(s) of
collective bargaining agreement(s) and any minimum funding arrangements;
-A description of the nature
and effect of any changes affecting comparability for each period in which a
statement of income is presented; and
-The most recent certified
funded status of the plan, as determined by the plan’s so-called “zone status,”
which is required by the Pension Protection Act of 2006.
-If the zone status is not
available, an employer will be required to disclose whether the plan is: (a)
less than 65% funded; (b) between 65% and 80% funded; or (c)
greater than 80% funded.
The FASB expects that the
revisions will be finalized and added to the Codification in September 2011.
For public entities, the enhanced disclosures will be required in fiscal years
ending after December 15, 2011. For nonpublic entities, the enhanced
disclosures will be required in fiscal years ending after December 15, 2012.
Offsetting -- IASB and FASB
Discuss Asset and Liability Offsetting and Other Matters
For detail, please contact info@hkcmcpa.us
As reported in its "IASB
Update" publication, the IASB and FASB met on July 20-21, 2011, and
discussed the following topics:
-Asset and liability
offsetting;
-Effective dates and
transition methods for certain projects;
-Institute of Chartered
Accountants of Scotland and New Zealand Institute of Chartered Accountants disclosure
report-education session;
-Impairment;
-Insurance contracts; and
-Leases.
The IASB held a separate
meeting on July 22, 2011, and discussed the following topics:
-Agenda consultation report;
-Asset and liability
offsetting;
-Hedge accounting under IFRS
9, Financial instruments;
-IFRS Interpretations
Committee-update from last meeting; and
-IFRS 9-effective dates
Asset-Backed Securities --
SEC Re-Proposes Shelf Eligibility Conditions for Asset-Backed Securities
For detail, please contact info@hkcmcpa.us
The SEC has issued for public
comment a proposed rule, Re-proposal of Shelf Eligibility Conditions for Asset-Backed
Securities and Other Additional Requests for Comment. This proposal revises
and re-proposes certain rules that were initially proposed in April 2010 by the
SEC related to asset-backed securities. Since that time, the Dodd-Frank Act was
enacted. As a result of this legislation and comments received on the original
proposal, the SEC now believes that some of its originally proposed rules are
either no longer necessary or should be changed as described in the revised
proposal.
Comments on this proposal are
due 60 days after publication in the Federal Register.
SEC Regulations Committee
-- CAQ SEC Regulations Committee Minutes Issued
For detail, please contact info@hkcmcpa.us
The Center for Audit Quality
SEC Regulations Committee has issued minutes from its joint meeting with the
staff of the SEC held on June 28, 2011. This committee meets periodically with
the SEC staff to discuss emerging technical accounting and reporting issues
relating to SEC rules and regulations. Topics discussed at this meeting
included the following:
-Update on the SEC’s Division of Corporation Finance personnel and
organizational changes;
-Various financial reporting
matters including: (a) SEC staff notifications of completion of Exchange
Act filing reviews; (b) loss contingency disclosures; (c)
definition of "full and unconditional" related to guaranteed
securities; and (d) reverse mergers;
-Implementation issues and
observations associated with the SEC’s requirements
on the use of eXtensible Business Reporting Language
(XBRL);
-Applicability of SEC
reporting requirements to acquisitions and dispositions made by a consolidated
variable interest entity (VIE);
-Calculating significance when
a registrant concludes it must consolidate a VIE;
-Disclosures under Item 304 of
Regulation S-K for auditor changes within an international network; and
-Subsidiary guarantor
financial statements provided under Rule 3-10(g) of Regulation S-X.
International Accounting --
CAQ International Practices Task Force Minutes Issued
For detail, please contact info@hkcmcpa.us
The Center for Audit Quality
International Practices Task Force has issued minutes from its joint meeting
with the staff of the SEC held on May 24, 2011. This task force meets
periodically with the SEC staff to discuss emerging technical accounting and
reporting issues relating to SEC rules and regulations. Topics discussed at
this meeting included the following:
-Canadian first time
application of IFRS-interim period financial information in a registration statement
or prospectus;
-Application of GAAP
applicable to private entities in Canada and the financial statement
requirements of Rule 3-05 and Rule 3-09 of foreign businesses;
-Acceptance of proposed
Canadian Auditing Standards task force auditors reports in SEC filings;
-Monitoring inflation in
certain countries;
-XBRL taxonomy for IFRS
issuers; and
-Registrant delinquent in its
Exchange Act reporting.
Government Auditing
Standards -- AICPA Publishes Audit Risk Alert
For detail, please contact info@hkcmcpa.us
The AICPA has published an
Audit Risk Alert, Government Auditing Standards and Circular A-133
Developments-2011. This Alert is intended to provide auditors who perform
audits under Government Auditing Standards or the Office of Management and
Budget Circular A-133, Audits of States, Local Governments and Non-Profit
Organizations, with an overview of recent economic, technical, industry,
regulatory, and professional developments that may affect the audits and other
engagements they perform. This Alert also can be used by an entity’s internal
management to address areas of audit concern.
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
=======================================
AUDITING AND INTERNAL CONTROLS
HEADLINES:
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Real Estate -- New Edition
of Knowledge-Based Audits of Real Estate Published
For detail, please contact info@hkcmcpa.us
We have published the 2011
edition of Knowledge-Based Audits of Real Estate. This publication is
designed to help the auditor efficiently and effectively perform financial
statement audits of real estate entities in accordance with auditing standards
generally accepted in the United States of America (GAAS). This edition of the publication
includes revisions and updates to reflect current audit and accounting
authoritative literature and, among other things, auditing pronouncements
through AICPA Statement on Auditing Standards (SAS) No. 120, Required
Supplementary Information.
See our Literature Update for
complete details.
Subsequent Events -- AICPA
Clarified Statement on Auditing Standards Discussed
For detail, please contact info@hkcmcpa.us
We have added a GAAS Update
Service that provides discussion and analysis of a clarified SAS, Subsequent
Events and Subsequently Discovered Facts, which was finalized as part of
the AICPA's Clarity Project. This clarified SAS will
supersede:
-SAS 1, Codification of
Auditing Standards and Procedures: (a) AU Section 530, Dating of
the Independent Auditor’s Report; (b) AU Section 560, Subsequent
Events; and (c) AU Section 561, -Subsequent Discovery of Facts
Existing at the Date of the Auditor’s Report.
-SAS 58 (AU Section 508), Reports
on Audited Financial Statements, paragraphs 71–73.
The clarified SAS is effective
for audits of financial statements for periods ending on or after December 15,
2012.
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: For
detail, please contact info@hkcmcpa.us"
Government Auditing
Standards -- AICPA Publishes Audit Risk Alert
For detail, please contact info@hkcmcpa.us
As discussed above in our
Accounting and SEC Summaries, the AICPA has published an Audit Risk Alert, Government
Auditing Standards and Circular A-133 Developments-2011. This Alert is
intended to provide auditors who perform audits under Government Auditing
Standards or the Office of Management and Budget Circular A-133, Audits of
States, Local Governments and Non-Profit Organizations, with an overview of
recent economic, technical, industry, regulatory, and professional developments
that may affect the audits and other engagements they perform. This Alert also
can be used by an entity’s internal management to address areas of audit
concern.
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
======================
GOVERNMENT HEADLINES:
======================
Service Concession
Arrangements -- GASB 60 Discussed
For detail, please contact info@hkcmcpa.us
We have added a Governmental
GAAP Update Service that discusses GASB Statement No. 60, Accounting and
Financial Reporting for Service Concession Arrangements. GASB 60 addresses
how to account for and report service concession arrangements (SCAs), a type of public-private or public-public
partnership that state and local governments are increasingly entering into.
Topics discussed in this update include:
-Overview of SCAs;
-Accounting and financial
reporting for SCAs; and
-Where SCAs
prevalent.
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