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News

FASB document Image

FASB simplifies guidance on nonemployee share-based payments

Jun 20, 2018

The FASB has issued Accounting Standards Update (ASU) No. 2018-07, “Improvements to Nonemployee Share-Based Payment Accounting.”

The ASU supersedes ASC 505-50 and expands the scope of ASC 718 to include all share-based payment arrangements related to the acquisition of goods and services from both nonemployees and employees.

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

SEC (US Securities and Exchange Commission) Image

SEC issues draft 2018−2022 strategic plan

Jun 19, 2018

The SEC has issued its draft strategic plan for fiscal years 2018−2022. The draft plan outlines the Commission’s mission, vision, values, strategic goals, and objectives.

In par­tic­u­lar, the draft plan defines and spec­i­fies how the SEC plans to meet three strate­gic goals:

    1. “Focus on the long-term interests of our Main Street investors.”
    2. “Recognize significant developments and trends in our evolving capital markets and adjust our efforts to ensure we are effectively allocating our resources.”
    3. “Elevate the SEC’s performance by enhancing our analytical capabilities and human capital development.”

Com­ments are due 30 days after the date of the plan’s publication in the Federal Register.

For more in­for­ma­tion, see the press release and draft strate­gic plan on the SEC’s Web site.

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Highlights of the June 2018 FASAC meeting

Jun 19, 2018

At its June 8, 2018, meeting, the FASB’s Financial Accounting Standards Advisory Council (FASAC) discussed (1) financial performance reporting and (2) subsequent accounting for goodwill and possible decision-making factors.

Financial performance reporting — disaggregation of performance information

A primary focus of the discussion was the project's starting point — namely, “the disaggregation of cost of revenue lines and selling, general, and administrative expense lines.” Other topics addressed included “potential interaction with the segment reporting project [and] potential approaches on which to base disaggregation.”

Subsequent accounting for goodwill and possible decision-making factors

The FASAC discussed potential improvements to GAAP related to goodwill accounting. Council members expressed mixed views on this topic.

For more in­for­ma­tion, see the meeting recap on the FASB’s Web site.

SEC (US Securities and Exchange Commission) Image

SEC to release letters to companies with serious deficiencies

Jun 15, 2018

The SEC’s Division of Corporation Finance has announced that letters sent to issuers that have “serious deficiencies” in their registration statement or offering document will be made available on EDGAR.

Filings with significant deficiencies can be defined as those that are “not minimally compliant with statutory or regulatory requirements.” Letters issued on June 15, 2018, or later will be published first; these letters will appear on EDGAR within 10 calendar days of issuance.

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

CAQ (US Center for Audit Quality) Image

CAQ reports on highly inflationary economies

Jun 15, 2018

The CAQ International Practices Task Force has issued “Monitoring Inflation in Certain Countries.”

The document identifies countries “where projected cumulative inflation rates would have been categorized into categories considering the guidance in ASC 830 and in circumstances where there was not consistent reliable data.”

For more information, see the discussion document on the CAQ’s Web site.

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FASB discusses segment reporting

Jun 15, 2018

At its June 13, 2018, meeting, the FASB discussed its project on segment reporting, including considerations related to improving the aggregation criteria and the process for determining reportable segments.

Specif­i­cally, the staff discussed a plan for the Board to perform “extended outreach” to obtain feedback on the following two alternatives:

  • “Re-order the process for determining reportable segments and move the quantitative thresholds earlier in that process.”
  • “Remove the aggregation criteria, thereby each operating segment would be reportable until a practical limit is reached.”

The extended outreach is expected to commence in August 2018. For more in­for­ma­tion, see the tentative Board decisions on the FASB’s Web site.

FASB document Image

FASB staff issues two taxonomy implementation guides

Jun 13, 2018

The FASB staff has issued two U.S. GAAP taxonomy implementation guides on (1) revenue from contracts with customers and (2) dimensional modeling for disclosures of consolidated and nonconsolidated entities.

The objective of the first implementation guide, Revenue From Contracts With Customers (Including Remodeling of Revenue and Cost of Revenue Presentation in the Statement of Income), is to “demonstrate the modeling for disclosures related to revenue from contracts with customers under [ASC 606] and the remodeling of revenue and cost of revenue presentation in the statement of income.”

The second implementation guide, Dimensional Modeling for Disclosures of Consolidated and Nonconsolidated Entities, provides examples “to help users of the Taxonomy understand how the modeling for disclosures of consolidated and nonconsolidated entities is structured within the Taxonomy.”

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EITF discusses three Issues at June meeting

Jun 08, 2018

At its meeting yesterday, the EITF discussed cloud computing arrangements, assumed liabilities in revenue contracts, and accounting for episodic television series.

Specif­i­cally, the EITF dis­cussed the fol­low­ing Issues:

  • Issue No. 17-A, “Customer’s Accounting for Implementation, Setup, and Other Upfront Costs (Implementation Costs) Incurred in a Cloud Computing Arrangement That Is Considered a Service Contract.”
  • Issue No. 18-A, “Recognition Under Topic 805 for an Assumed Liability in a Revenue Contract.”
  • Issue No. 18-B, “Improvements to Accounting for Episodic Television Series.”

For a de­tailed summary of the meeting, see De­loitte’s June EITF Snap­shot.

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Highlights of the FASB’s June 6 meeting

Jun 08, 2018

At its June 6, 2018, meeting, the FASB discussed its projects on (1) long-duration insurance contracts, (2) distinguishing liabilities from equity, and (3) variable interest entities.

Insurance — targeted improvements to the accounting for long-duration contracts

The Board redeliberated its proposed ASU, Targeted Improvements to the Accounting for Long-Duration Contracts, and made tentative de­ci­sions about the discount rate for transition, effective date and early adoption, and market risk benefits. The Board directed its staff to draft a final ASU for a vote by written ballot.

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

Distinguishing liabilities from equity (including convertible debt)

The Board dis­cussed the direction of the project on convertible instruments and whether instruments are indexed to an entity’s own stock.

For more in­for­ma­tion, see the tentative Board decisions on the FASB’s Web site.

Consolidation — targeted improvements to related-party guidance for variable interest entities

The Board discussed transition guidance related to the private-company accounting alternative and directed its staff to proceed with drafting a final ASU for a vote by written ballot.

For more in­for­ma­tion, see the meeting minutes on the FASB’s Web site.

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FASB appoints new EITF member

Jun 07, 2018

The FASB has appointed Eric C. West as an EITF member.

Mr. West joins the EITF from Amazon.com Inc., where he currently serves as its director of accounting policy. In addition, he served as an associate chief accountant in the Office of the Chief Accountant and the Division of Corporation Finance at the SEC.

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

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