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FASB document Image

FASB issues narrow-scope improvements to lessor accounting

Dec 11, 2018

The FASB has issued Accounting Standards Update (ASU) No. 2018-20, “Narrow-Scope Improvements for Lessors.”

The ASU makes amendments related to sales taxes and other similar taxes collected from lessees, certain lessor costs, and recognition of variable payments for contracts with lease and nonlease components.

For more in­for­ma­tion, see the press release and ASU on the FASB’s Web site.

FASB meeting Image

FASB discusses Codification improvements for lessors

Dec 06, 2018

At its December 4, 2018, meeting, the FASB decided to add a project to its technical agenda on Codification improvements for lessors.

The project will address the following two issues:

  • The determination of the underlying asset’s fair value by lessors that are not manufacturers or dealers — The Board decided that “if a lessor is not a manufacturer or a dealer, the fair value of the underlying asset at lease commencement is its cost, reflecting any volume or trade discounts that may apply,” unless a significant amount of time elapses “between the acquisition of the underlying asset and lease commencement,” in which case the lessor should apply the definition of “fair value” (this exception is similar to the one in ASC 840).
  • Presentation in the statement of cash flows — sales-type and direct financing leases — The Board decided that lessors that are financial institutions within the scope of ASC 942 “would present all ‘principal payments received under leases’ within investing activities as opposed to operating activities.”

In addition, the Board (1) made tentative decisions regarding the transition and effective date for the amendments and (2) analyzed the costs and benefits. The Board directed its staff to draft a proposed ASU for a vote by written ballot.

For more information, see our related journal entry as well as the tentative Board decisions on the FASB’s Web site.

AICPA document Image

AICPA publishes final draft of SAS related to employee benefit plans subject to ERISA

Dec 06, 2018

The AICPA has published a final balloted draft of its Statement on Auditing Standards (SAS) “Forming an Opinion and Reporting on Financial Statements of Employee Benefit Plans Subject to ERISA.”

The draft SAS “addresses the auditor’s responsibility to form an opinion and report on the audit of financial statements of employee benefit plans subject to the Employee Retirement Income Security Act of 1974 (ERISA), and the form and content of the auditor’s report issued as a result of an audit of ERISA plan financial statements.”

For more information, see the press release and SAS final balloted draft on the AICPA’s Web site.

IAC meeting Image

Investor Advisory Committee holds November 2018 meeting

Dec 06, 2018

At its November 29, 2018, meeting, the FASB’s Investor Advisory Committee (IAC) discussed income tax disclosures, segment reporting, distinguishing liabilities from equity, antidilutive earnings-per-share hedge transactions, SEC disclosure update and simplification, and IAC emerging issues and trends.

The next IAC meeting is scheduled for May 14, 2019. For more information, see the meeting recap on the FASB’s Web site.

SEC (US Securities and Exchange Commission) Image

SEC issues final rule on covered investment fund research reports

Dec 03, 2018

As part of the Fair Access to Investment Research Act of 2017, the SEC has issued a final rule, “Covered Investment Fund Research Reports,” which is designed to “establish a safe harbor for a broker or dealer to publish or distribute research reports on investment funds under certain conditions.”

In ad­di­tion, the SEC has adopted a new rule to exclude a covered investment fund research report from the coverage of Section 24(b) of the Investment Company Act of 1940 unless certain exemptions are met. The Commission has also made conforming amendments to Rule 101 of Regulation M and Form 12b-25.

For more in­for­ma­tion, see the press release and final rule on the SEC’s Web site.

GASB (blue) Image

GASB issues proposed implementation guide

Nov 28, 2018

The GASB has issued a proposed implementation guide, “Implementation Guidance Update — 2019,” which consists of Q&As that would “clarify, explain, or elaborate on” certain GASB Statements.

Topics addressed in the proposed guide’s Q&As include:

  • Cash flow reporting.
  • Postemployment benefits.
  • Derivative instruments.
  • Irrevocable split-interest agreements.
  • Tax abatement disclosures.

In addition, the proposed guide amends certain Q&As from previously issued implementation guides.

Comments on the proposed implementation guide are due by January 31, 2019. For more information, see the proposed guide on the GASB’s Web site.

SEC (US Securities and Exchange Commission) Image

SEC to review certain rules in accordance with the Regulatory Flexibility Act

Nov 26, 2018

The SEC has published a list of rules to be reviewed in accordance with Section 610 of the Regulatory Flexibility Act, which requires a review of rules that have a "significant economic impact upon a substantial number of small entities within ten years of the publication of such rules as final rules."

The SEC is seeking comments on "whether the rules should be continued without change, or should be amended or rescinded to minimize any significant economic impact of the rules upon a substantial number of such small entities."

For more information, see the notice on the SEC’s Web site.

FASB document Image

FASB proposes narrow-scope amendments to guidance on financial instruments

Nov 20, 2018

The FASB has issued a proposed Accounting Standards Update (ASU), “Codification Improvements — Financial Instruments,” which would clarify and improve guidance related to credit losses, hedging, and recognition and measurement.

The proposed ASU would make improvements to the following aspects of financial instruments:

  • Accrued interest.
  • Transfers between classifications or categories for loans and debt securities.
  • Conforming amendment to ASC 310-40 and ASC 323-10.
  • Clarification that reinsurance recoverables are within the scope of ASC 326-20.
  • Projections of interest-rate environments for variable-rate financial instruments.
  • Consideration of prepayments in the determination of the effective interest rate.
  • Consideration of estimated selling costs when foreclosure is probable.
  • Partial-term fair value hedges of interest rate risk.
  • Amortization of fair value hedge basis adjustments.
  • Disclosure of fair value hedge basis adjustments.
  • Consideration of the hedged contractually specified interest rate under the hypothetical derivative method.
  • Scope for not-for-profit entities.
  • Hedge accounting provisions applicable to certain private companies and not-for-profit entities.
  • Application of a first-payments-received cash flow hedging technique to overall cash flows related to a group of variable interest payments.
  • Update to ASU 2017-12 transition guidance.
  • Scope clarifications for ASC 320-10 and 321-10.
  • Fair value disclosures related to held-to-maturity debt securities.
  • Applicability of ASC 820 to the measurement alternative.
  • Remeasurement of equity securities at historical exchange rates.
  • Vintage disclosures — line-of-credit arrangements converted to term loans.
  • Contractual extensions and renewals.

Comments on the proposed ASU are due by December 19, 2018.

For more in­for­ma­tion, see the press release and proposed ASU on the FASB’s Web site.

On November 27, 2018, the FASB issued for comment Proposed Accounting Standards Update, Codification Improvements — Financial Instruments. Comments on the proposed taxonomy improvements are due by December 26, 2018.

AICPA (American Institute of CPAs) Image

AICPA releases working draft on inventory valuation guidance

Nov 20, 2018

The AICPA’s Financial Reporting Executive Committee has released for public comment a working draft on fair value of inventory acquired in a business combination under ASC 820, “Fair Value Measurement.”

The working draft, Inventory Valuation Guidance, will be part of the upcoming Ac­count­ing and Au­dit­ing Guide, Business Combinations.

Com­ments on the working draft are due by February 1, 2019. For more in­for­ma­tion, see the press release on the AICPA’s Web site.

SEC (US Securities and Exchange Commission) Image

SEC posts drafts of EDGAR Filer Manual for upcoming EDGAR release

Nov 19, 2018

The SEC has issued drafts of Volumes I, II, and certain technical specifications of its Electronic Data Gathering, Analysis, and Retrieval System (EDGAR) Filer Manual for upcoming EDGAR Release 18.4.

The new release is sched­uled for im­ple­men­ta­tion on December 17, 2018. The drafts have not been ap­proved by the Com­mis­sion and are subject to change. The final version of the EDGAR Filer Manual will be posted on the SEC’s Web site once it has been ap­proved.

For more in­for­ma­tion, see the fol­low­ing on the SEC’s Web site:

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