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Quarterly Accounting Roundup: Year in review — 2018

Published on: Dec 18, 2018

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Welcome to Quarterly Accounting Roundup: Year in Review — 2018. Notable standards issued by the FASB in 2018 include Accounting Standards Updates (ASUs) that:

  • Amend the guidance on cloud computing arrangements.
  • Clarify the guidance on collaborative arrangements.
  • Make targeted amendments to the related-party guidance for variable interest entities.
  • Make narrow-scope amendments to the guidance on credit losses.
  • Improve disclosure effectiveness.
  • Make targeted improvements to the guidance on long-duration insurance contracts.
  • Clarify the guidance on contributions received and made.

On the regulatory front, cybersecurity was once again a major concern this year. The SEC issued interpretive guidance in February in response to the pervasive increase in digital technology as well as the severity and frequency of cybersecurity threats and incidents. This was followed by an investigative report in October that cautioned companies to consider cyber threats when they are implementing their internal accounting controls. Further, the SEC advanced its rulemaking activities and agenda, which are largely governed by the Commission’s interconnected focus on facilitating capital formation and disclosure effectiveness, by releasing a number of final and proposed rules. These rules include a final rule to amend certain outdated, duplicative, or redundant disclosure requirements and a proposed rule that would simplify and streamline financial disclosures about guarantors and issuers of guaranteed securities and affiliates whose securities collateralize a registrant’s securities (SEC Regulation S-X, Rules 3-10 and 3-16). As the year comes to a close, the SEC is planning to hold a December 19, 2018, open meeting to consider the issuance of a request for comment on earnings releases and quarterly reporting.

The AICPA held its annual Conference on Current SEC and PCAOB Developments in early December. During the conference, representatives from the SEC, PCAOB, FASB, IASB, and other organizations provided updates on new developments, regulations, and current priorities. Dominating the conversation at this year’s conference were the reporting of critical audit matters; Brexit; the application of the FASB’s new standards on revenue recognition, leases, and credit losses; the potential transition away from the London Interbank Offered Rate (LIBOR); and cybersecurity.

For more information about the conference, see Deloitte’s December 16, 2018, Heads Up.

In international news, the International Accounting Standards Board (IASB®) published its revised conceptual framework for financial reporting as well as amendments that (1) enhance the definition of a business in IFRS 3, Business Combinations, and (2) revise the definition of materiality.

Quarterly Accounting Roundup: Year in Review — 2018 summarizes final guidance that affects reporting and disclosures for the coming reporting season. With the exception of fourth-quarter developments, proposed guidance is not included. For more information about earlier proposals, please see issues of Accounting Roundup for the first three quarters of 2018.

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