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Accounting
Research Manager®
Weekly
Summary of Developments
September
26-30, 2011
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Accounting
Research Manager subscriber,
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developments. Click the link below to access and print the fully-formatted
Weekly Summary:
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ACCOUNTING
AND SEC HEADLINES:
=============================
Compensation
Arrangements -- Interpretation Updated
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We have
revised our publication, Accounting for Compensation Arrangements. This
publication offers guidance on a variety of issues that companies and their
advisers may face in accounting for various types of stock-based compensation
arrangements. Among the changes we have made to this publication are to include
updates to:
- Discuss
certain matters resulting from the Dodd-Frank Wall Street Reform and Consumer
Protection Act;
- Reflect
new guidance issued to account for a share-based payment award with an exercise
price denominated in the currency of a market in which the underlying equity
security trades;
- Provide
the views expressed by the SEC staff on certain issues related to the valuation
of privately-held-company equity securities issued as compensation; and
- Discuss
certain views of the SEC staff on compensation arrangements with related
parties.
See our
Literature Update for complete details.
Reverse
Mergers -- SEC Staff Issues Guidance on Reporting Reverse Mergers and Similar
Transactions
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The staff in
the Division of Corporation Finance (Corp Fin) of the SEC has issued CF
Disclosure Guidance: Topic No. 1, “Staff Observations in the Review of Forms
8-K Filed to Report Reverse Mergers and Similar Transactions.” This guidance
summarizes Corp Fin's observations and frequent comments cited in the review of
Forms 8-K filed to report reverse mergers and similar transactions. Topics
discussed in this guidance include the following items of Form 8-K:
- Item 2.01
disclosure for an acquisition or disposition of a significant amount of assets
other than in the ordinary course of business;
- Item 5.01
information about a change in control for a company that was a shell company
immediately before the respective transaction; and
- Item 9.01
considerations related to: (a) financial statements of businesses
acquired; (b) pro forma financial information; (c) shell company
transactions; and (d) requirements for exhibits.
In addition,
the staff guidance discusses several specific requirements related to Form 10.
IFRS for SMEs -- IASB Publishes Proposed Implementation Guidance
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The IASB has
published for public comment the following draft implementation guidance:
- Draft
Implementation Guidance - IFRS for SMEs: General,
Issue 1 - Application of the IFRS for SMEs for
Financial Periods Ending Before the IFRS for SMEs was
Issued;
- Draft
Implementation Guidance - IFRS for SMEs: General,
Issue 2 - Interpretation of ‘Undue Cost or Effort’ and ‘Impracticable’;
- Draft
Implementation Guidance - IFRS for SMEs: Section 3,
Issue 1 - Jurisdiction Requires Fallback to Full IFRSs;
- Draft
Implementation Guidance - IFRS for SMEs: Section 3,
Issue 2 - Departure from a Principle in the IFRS for SMEs;
and
- Draft
Implementation Guidance - IFRS for SMEs: Section 3,
Issue 3 - Prescription of the Format of Financial Statements by Local
Regulation.
This draft
guidance was issued in a question and answer format and was prepared by the SME
Implementation Group that is responsible for assisting the IASB on matters
related to the implementation of IFRS for Small and Medium-sized Entities (SMEs). It is intended to provide nonmandatory
and timely guidance on specific accounting questions that are being raised with
the SME Implementation Group by users implementing the IFRS for SMEs.
Comments on
this draft guidance are due November 30, 2011.
Leases --
IASB and FASB Discuss Leases and Other Matters
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As reported
in its "IASB Update" publication, the IASB and FASB held joint
sessions on September 19 and 21, 2011, and discussed the following topics:
- Leases;
-
Impairment; and
- Insurance
contracts.
The IASB
held separate sessions on September 19-22, 2011, and discussed the following
topics:
- IFRIC 20, Stripping
Costs in the Production Phase of a Surface Mine;
- Put
options written over non-controlling interests;
- IFRS
Interpretations Committee-update from last meeting;
- Asset and
liability offsetting;
- Hedge
accounting under IFRS 9, Financial Instruments;
- Annual
improvements;
- IFRS 2, Share-based
Payment;
-
Prospective application provisions for first-time adopters under IFRS 1, First-time
Adoption of IFRSs;
-
Aggregation criteria and identification of the Chief Operating Decision Maker
under IFRS 8, Operating Segments;
- Macro
hedge accounting; and
Work plan.
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AUDITING AND
INTERNAL CONTROLS HEADLINES:
=======================================
Ethics --
AICPA Issues Proposed Ethics Guidance
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The AICPA
has issued an Exposure Draft (ED), Omnibus Proposal – AICPA Professional
Ethics Division – Proposed New and Revised Interpretations and Proposed
Deletions of Ethics Rulings. This ED contains a number of proposals for
review and comment by AICPA members and other interested parties. Two proposals
clarify the requirements when a member prepares or reports on financial
statements under another comprehensive basis of accounting or the financial
reporting framework of a country that is not promulgated by a body designated
by the AICPA Council. A third proposal makes changes to member requirements
when it comes to responding to records requests from clients and former
clients.
Comments on
the ED are due November 23, 2011.
Group
Financial Statement Audits -- Clarified SAS Discussed
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We have
added a GAAS Update Service that provides discussion and analysis of a
clarified Statement on Auditing Standards (SAS), Special
Considerations-Audits of Group Financial Statements (Including the Work of
Component Auditors), which was finalized as part of the AICPA's
Clarity Project. The clarified SAS will supersede: (a) SAS 1 (AU Section
543), Part of Audit Performed by Other Independent Auditors; and (b)
SAS 58 (AU Section 508), Reports on Audited Financial Statements,
paragraphs 12 and 13 (pertaining to the auditor’s opinion that is based in part
on the report of another auditor).
The
clarified SAS will be effective for audits of group 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.
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======================
GOVERNMENT
HEADLINES:
======================
Deferrals
-- GASB Proposal Discussed
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We have
published a Governmental GAAP Update Service that discusses the GASB's Exposure Draft, Reporting Items Previously
Recognized as Assets and Liabilities. This proposal is more commonly known
as the “deferrals project” because it proposes which elements of assets,
liabilities, revenues, and expenditures (expenses) should be reclassified to
deferred inflows and deferred outflows of resources. In addition, the proposal
also clarifies when deferred inflows and deferred outflows of resources would
appear in fund-based financial statements. Topics discussed in this update are:
- Advance refundings and defeasances of debt;
-
Non-exchange transactions in governmental funds;
- Sales and
intra-entity transfers of future revenues;
- Bond
issuance costs and leases;
- Insurance,
mortgages, and loans;
- Regulated
operations;
- Revenue
recognition items and the use of the term "deferred";
- Adjustment
to major fund criteria; and
- Listing of
proposed classifications.
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the documents listed above may not be accessible under your current subscription.
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content, click here:
For detail, please contact info@hkcmcpa.us