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Accounting
Research Manager®
Weekly
Summary of Developments
October
10-14, 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:
For detail, please contact info@hkcmcpa.us
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:
=============================
Auditor
Reporting -- PCAOB Proposes Amendments to Auditor Reporting
For detail, please contact info@hkcmcpa.us
The PCAOB
has issued for public comment a Proposed Rule, Release No. 2011-007:
Improving the Transparency of Audits - Proposed Amendments to PCAOB Auditing
Standards and Form 2, to amend its standards in an effort to bring greater
transparency to public company audits. The proposal would require registered
accounting firms to disclose the name of the engagement partner in the audit
report and on PCAOB Annual Report Form 2. It would also require disclosure in
the audit report of other accounting firms and other persons not employed by
the auditor that took part in the audit.
The PCAOB
did not include in this proposal a requirement to have the engagement partner
sign his or her name on the audit report. Instead, the proposal would require
that the engagement partner's name be disclosed in the audit report, which
would make the engagement partner's name readily available to the users of the
audit report while mitigating concerns about minimizing the firm's role in the
audit.
In addition,
the proposal would require the auditor to disclose in the audit report other
accounting firms and other persons not employed by the auditor that took part
in the audit. The proposed disclosure would enable investors to evaluate the
other participants in the audit in the same manner that they evaluate the auditor.
Comments on
the proposed amendments are due January 9, 2012.
Financial
Reporting Manual -- SEC Staff Releases Updated Financial Reporting Manual
For detail, please contact info@hkcmcpa.us
The staff in
the Division of Corporation Finance (Corp Fin) of the SEC has released the
updated Financial Reporting Manual, reflecting changes through June 30,
2011. This manual represents informal guidance prepared for use by Corp Fin
staff. Corp Fin has made this manual public because readers may find the
guidance useful in preparing filings with the SEC. We have prepared a
Literature Update highlighting areas in the manual updated by the Corp Fin
staff. In addition, as described in our Literature Update, we have available in
PDF format the prior quarterly versions of Corp Fin’s Financial Reporting
Manual, dating back to December 2008 when the first version was released.
See our
Literature Update for complete details.
Risk
Alerts -- AICPA Issues Audit Risk Alerts
The AICPA
has issued the following Audit Risk Alerts:
- General
Accounting and Auditing Developments-2011/2012; For
detail, please contact info@hkcmcpa.us and
- Real
Estate and Construction Industry Developments-2011/2012. For detail, please contact info@hkcmcpa.us
AICPA Audit
Risk Alerts provide users with a detailed overview of recent industry,
technical, regulatory, or professional developments. Topics covered in each
Alert include: (a)legislative and 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@hkcmcpa.us
=======================================
AUDITING AND
INTERNAL CONTROLS HEADLINES:
=======================================
Auditing
Standards -- ASB Issues Clarity Project SASs
The Auditing
Standards Board (ASB) of the AICPA has issued the following Statements on
Auditing Standards (SASs) related to its Clarity
Project:
- SAS
No. 122, Statements on Auditing Standards: Clarification and Recodification; For detail,
please contact info@hkcmcpa.us
- SAS
No. 123, Omnibus Statement on Auditing Standards - 2011; For detail, please contact info@hkcmcpa.us and
- SAS
No. 124, Financial Statements Prepared in Accordance With a Financial
Reporting Framework Generally Accepted in Another Country. For detail, please contact info@hkcmcpa.us
The new SASs will be effective for audits of financial statements
for periods ending on or after December 15, 2012, and will supersede most
current guidance.
We have
prepared a “Hot Topic” that discusses in greater detail the contents of the new
SASs and the effect of the Clarity Project on AICPA Professional
Standards.
For detail, please contact info@hkcmcpa.us
Audit
Sampling -- Clarified SAS Discussed
For detail, please contact info@hkcmcpa.us
We have
added a GAAS Update Service that provides discussion and analysis of a
clarified SAS, Audit Sampling (Redrafted), which was finalized as part
of the AICPA's Clarity Project. The clarified SAS
will supersede SAS 39 (AU Section 350), Audit Sampling, but does not
change or expand the existing guidance in AU Section 350 in any significant
respect. However, some of the existing content in AU Section 350 was not
carried over to, or incorporated in, the clarified SAS because it is already
addressed in another SAS or in the AICPA Audit Guide, Audit Sampling.
The
clarified SAS will be effective for audits of financial statements for periods
ending on or after December 15, 2012.
Auditor
Reporting -- PCAOB Proposes Amendments to Auditor Reporting
For detail, please contact info@hkcmcpa.us
As discussed
above in our Accounting and SEC Summaries, the PCAOB has issued for public
comment a Proposed Rule, Release No. 2011-007: Improving the Transparency of
Audits - Proposed Amendments to PCAOB Auditing Standards and Form 2, to
amend its standards in an effort to bring greater transparency to public
company audits. The proposal would require registered accounting firms to
disclose the name of the engagement partner in the audit report and on PCAOB
Annual Report Form 2. It would also require disclosure in the audit report of
other accounting firms and other persons not employed by the auditor that took
part in the audit.
The PCAOB
did not include in this proposal a requirement to have the engagement partner
sign his or her name on the audit report. Instead, the proposal would require
that the engagement partner's name be disclosed in the audit report, which
would make the engagement partner's name readily available to the users of the
audit report while mitigating concerns about minimizing the firm's role in the
audit.
In addition,
the proposal would require the auditor to disclose in the audit report other
accounting firms and other persons not employed by the auditor that took part
in the audit. The proposed disclosure would enable investors to evaluate the
other participants in the audit in the same manner that they evaluate the
auditor.
Comments on
the proposed amendments are due January 9, 2012.
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:
- General
Accounting and Auditing Developments-2011/2012; and For detail, please contact info@hkcmcpa.us
- Real
Estate and Construction Industry Developments-2011/2012. For detail, please contact info@hkcmcpa.us
AICPA Audit
Risk Alerts provide users with a detailed overview of recent industry,
technical, regulatory, or professional developments. Topics covered in each
Alert include: (a)legislative and 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@hkcmcpa.us
======================
GOVERNMENT
HEADLINES:
======================
GASB
Standards -- GASB Proposes Technical Corrections
For detail, please contact info@hkcmcpa.us
The GASB has
issued for public comment an exposure draft, GASB Proposed Statement,
Technical Corrections - An Amendment of GASB Statements No. 10 and No. 62.
According to the GASB, this proposal is intended to improve accounting and
financial reporting for governmental financial reporting entities by resolving
conflicting guidance that resulted from the issuance of two recent
pronouncements. The pronouncements are GASB Statement No. 54, Fund Balance
Reporting and Governmental Fund Type Definitions, and GASB Statement No.
62, Codification of Accounting and Financial Reporting Guidance Contained in
Pre-November 30, 1989 FASB and AICPA Pronouncements.
The proposal
would amend GASB Statement No. 10, Accounting and Financial Reporting for
Risk Financing and Related Insurance Issues, by removing the provision that
limits fund-based reporting of an entity’s risk financing activities to the
general fund and the internal service fund type. The proposal would also amend
GASB 62 by modifying the specific guidance on accounting for: (a)
operating lease payments that vary from a straight-line basis; and (b)
the difference between the initial investment (purchase price) and the
principal amount of a purchased loan or group of loans.
As proposed,
the provisions in this exposure draft would be effective for periods ending
after June 15, 2012. Earlier application would be encouraged.
Comments on
this proposal are due December 16, 2011.
Government
Auditing Standards -- GAO Release of New Yellow Book Discussed
For detail, please contact info@hkcmcpa.us
We have
published a Governmental GAAP Update Service that discusses the August 2011
release of the electronic version of the new Government Auditing Standards
(commonly known as the Yellow Book) by the U.S. General Accountability Office
(GAO). Specifically, this update focuses on the independence framework and
includes discussion on: (a) examples of threats; and (b)
responsibility for the preparation of financial statements.
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