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Accounting
Research Manager®
Weekly
Summary of Developments
January
9-13, 2012
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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
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ACCOUNTING
AND SEC HEADLINES:
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Checklists
-- AutoCheck
For detail, please contact info@hkcmcpa.us
The AutoCheck U.S. GAAP Disclosures Checklist and
the AutoCheck U.S. GAAP Interim Disclosures
Checklist have been updated for the disclosure and presentation
requirements in effect as of December 31, 2011. These checklists include
changes made by the FASB to the FASB Accounting Standards CodificationTM
(Codification) since the issuance of our checklists dated September 30, 2011,
through FASB Accounting Standards Update (ASU) No. 2011-12, Comprehensive
Income (Topic 220): Deferral of the Effective Date for Amendments to the
Presentation of Reclassifications of Items Out of Accumulated Other
Comprehensive Income in Accounting Standards Update No. 2011-05.The AutoCheck checklists are organized by accounting topic,
consistent with the Codification's broad structure, and provide authoritative
references. Once completed, they can be printed and placed in annual or
quarterly work papers, as applicable, to provide support for review and
compliance procedures.
Existing
users of these AutoCheck checklists must
update the software supporting the checklist as explained at the bottom of our
Literature Update.
Sovereign
Debt -- SEC Staff Issues Guidance on European Sovereign Debt Exposures
For detail, please contact info@hkcmcpa.us
The staff in
the Division of Corporation Finance (Corp Fin) of the SEC has issued CF
Disclosure Guidance: Topic No. 4, “European Sovereign Debt Exposures.” This
guidance provides the views of the Corp Fin staff regarding disclosure of
registrants’ exposures to risks related to holdings of the sovereign debt of
certain European countries.
As a result
of the recent uncertainties with regard to European sovereign debt holdings,
the Corp Fin staff has expressed concerns about the risks to financial
institutions from direct and indirect exposures to these holdings and indicated
inconsistent disclosures in registrant filings regarding the nature and extent
of the exposures. The Corp Fin staff is issuing this guidance to provide
additional information to assist registrants in their assessment of what
information about exposures to sovereign debt risk of European countries they
should consider disclosing and how they should disclose this information with
the goal of greater clarity and comparability.
Income
Taxes -- FAF Issues Post-Implementation Review Report on Tax Uncertainties
For detail, please contact info@hkcmcpa.us
The
Financial Accounting Foundation (FAF) has published Post-Implementation
Review Report on FASB Interpretation No. 48, Accounting for Uncertainty in
Income Taxes. The trustees of the FAF have implemented a new process
whereby FASB standards are going to be reviewed by a post-implementation review
team to evaluate whether the standard is accomplishing its stated purpose and
providing the expected benefits.
The first
post-implementation standard reviewed was FASB Interpretation No. 48, Accounting
for Uncertainty in Income Taxes (codified in Topic 740, Income Taxes).
The review team concluded that income tax uncertainties under this standard are
being recognized and measured more consistently than under prior literature,
and on balance the costs of the standard outweigh its costs. In addition, the
review team made various recommendations including the following:
-The FASB
should continue its efforts to improve user input in its agenda and early
deliberation phases to evaluate alternatives addressing user needs;
-Each
standard issued should include a thorough discussion about the need for new
financial reporting guidance and the benchmark characteristics of useful
financial information considered; and
-Each
standard should include a thorough discussion about the benefits and
beneficiaries in the new guidance, the associated costs to affected principal
stakeholders, and how benefits and costs are evaluated and assessed.
The FAF will
be doing a similar review of GASB standards.
Liquidation
Basis of Accounting -- FASB Discusses Liquidation Basis of Accounting and Other
Matters
For detail, please contact info@hkcmcpa.us
As reported
in its "Summary of Board Decisions" publication, the FASB met on January
11, 2012, and discussed the following topics: (a) disclosures about
risks and uncertainties and the liquidation basis of accounting; and (b)
impairment of indefinite-lived intangible assets.
Regarding
its project on disclosures related to the liquidation basis of accounting, the
FASB decided not to require that management of an entity assess whether there
is substantial doubt about the entity’s ability to continue as a going concern.
A majority of FASB members observed that such a requirement would be difficult
to apply and that users of financial statements would benefit to a greater
extent from ongoing disclosures about risks and uncertainties than they would
from disclosures that would be made only after management concludes that there
is substantial doubt about an entity’s ability to continue as a going concern.
As a next step in this project, the FASB directed its staff to develop a
principle for an entity to assess the adequacy of its disclosures about risks
and uncertainties and to evaluate how the content of such disclosures could be
improved.
Separately,
the FASB affirmed that the comment period on the forthcoming exposure draft on
impairment of indefinite-lived intangibles, would close at the end of April
2012, providing constituents with a 90-day period to submit their responses.
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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Recent
AICPA Auditing Standards -- Checklist Updated
For detail, please contact info@hkcmcpa.us
We have updated
our publication "Summary Checklist of Recent Authoritative AICPA
Professional Standards," to reflect the issuance of the following AICPA
Statements on Auditing Standards (SASs):
-SAS No.
122, Statements on Auditing Standards: Clarification and Recodification;
-SAS No.
123, Omnibus Statement on Auditing Standards-2011;
-SAS No.
124, Financial Statements Prepared in Accordance With a Financial Reporting
Framework Generally Accepted in Another Country; and
-SAS No.
125, Alert That Restricts the Use of the Auditor’s Written Communication.
The issuance
of SAS 122 is the major milestone of the AICPA’s
Clarity Project. SAS 122 contains 39 clarified SASs
that the Auditing Standards Board had finalized, but not issued, during the
past three years as part of the Clarity Project.
The
checklist is intended to serve as a reference used to review those engagement
and other related authoritative standards recently issued by the AICPA. The
standards include: (a) SASs; (b)
Statements on Standards for Attestation Engagements; (c) Statements on
Standards for Accounting and Review Services; (d) Statements on Quality
Control Standards; and (e) Statements of Position. Effective dates and a
summary of the standards are also presented. When a particular standard is applicable
may depend in part on the fiscal year-end of the entity to which the procedures
are being applied.
See our
Literature Update for complete details.
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."
Auditor's
Opinions -- AICPA Standards on Emphasis-of-Matter Paragraphs and Other-Matter
Paragraphs in the Independent Auditor’s Report Discussed
For detail, please contact info@hkcmcpa.us
We have
added a GAAS Update Service that provides discussion and analysis of a
clarified SAS, Emphasis-of-Matter Paragraphs and Other-Matter Paragraphs in
the Independent Auditor’s Report, which was finalized as part of the AICPA's Clarity Project and subsequently designated as AU-C
Section 706, Emphasis-of-Matter Paragraphs and Other-Matter Paragraphs in
the Independent Auditor’s Report, by SAS 122. AU-C Section 706 along with
AU-C Section 700, Forming an Opinion and Reporting on Financial Statements,
and AU-C Section 705, Modifications to the Opinion in the Independent
Auditor’s Report, will supersede various paragraphs of SAS-58 (AU Section
508), Reports on Audited Financial Statements.
AU-C Section
706 will be effective for audits of financial statements for periods ending on
or after December 15, 2012.
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
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GOVERNMENT
HEADLINES:
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Yellow
Book -- New CPE Requirements under the Yellow Book Discussed
For detail, please contact info@hkcmcpa.us
We have
published a Governmental GAAP Update Service that discusses the changes to
continuing professional education requirements (CPE) included in the newest
edition of Government Auditing Standards (Yellow Book). Topics discussed
in this update include:
-New Yellow
Book CPE requirements;
-CPE
requirements for all Yellow Book auditors;
-Auditors in
charge of Yellow Book engagements;
-CPE
requirements for external and internal specialists;
-Various
state requirements; and
-Various
other certification requirements.
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