Flashline - Week ending November 20, 2012 (No. 2012-46)

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PwC's weekly alert highlighting current financial reporting developments (including accounting, auditing and regulatory matters). This week's topics include:

• In brief: FASB amends new disclosures on items reclassified from accumulated other comprehensive income 
• In brief: Boards make decisions on several major outstanding revenue issues 
• IASB seeks comments on proposed amendments under annual improvements project 
• SEC issues resource guide to the U.S. Foreign Corrupt Practices Act 
• PCAOB to meet on November 28 to consider 2013 budget and strategic plan 
• ARSC issues proposed SSARSs under clarity project

PwC

In brief: FASB amends new disclosures on items reclassified from accumulated other comprehensive income

The FASB met on November 14 to discuss the feedback received on its exposure draft on the new disclosures on items reclassified from accumulated other comprehensive income. The board decided to move towards a final standard after making decisions on presentation, interim disclosures, and the effective date. This In brief article provides an overview of those decisions and what's next.

In brief: Boards make decisions on several major outstanding revenue issues

The FASB and IASB (the “boards”) reached decisions on when revenue from variable consideration should be recognized, presentation of amounts not expected to be collected and licenses at their November meeting on revenue recognition. This In brief article provides an overview of the boards' decisions and what's next.

Financial Accounting Standards Board (FASB)

FASB meetings and project updates

Meeting summary: The FASB and IASB met jointly on November 19 and discussed their project on revenue recognition. See PwC’s In brief article above and the FASB’s website for a summary of the decisions reached at the meeting.

The boards also met jointly on November 20 and discussed their projects on (1) accounting for financial instruments (impairment) and (2) insurance contracts. The FASB met after the joint meeting to continue discussing the insurance contracts project. Summaries of decisions reached as these meetings will be available on the FASB’s website shortly.

Next open board meeting: The FASB's next board meeting is scheduled for November 28. Topics for the meeting have not yet been released. Visit the FASB’s website in the coming days for further information on the meeting.

International Accounting Standards Board (IASB)

IASB seeks comments on proposed amendments under annual improvements project

The IASB has published for public comment an exposure draft of proposed amendments to four International Financial Reporting Standards (IFRSs) under its annual improvements project. The project provides a streamlined process for dealing with a collection of non-urgent amendments to IFRSs. These amendments meet the criteria for the IASB’s annual improvements process set out in the Due Process Handbook for the IASB. The criteria help decide whether a matter relating to the clarification or correction of IFRSs should be addressed using the annual improvements process.

The comment period on the exposure draft ends on February 18, 2013.

Securities and Exchange Commission (SEC)

SEC issues resource guide to the U.S. Foreign Corrupt Practices Act

The SEC and the Department of Justice published a guide titled A Resource Guide to the U.S. Foreign Corrupt Practices Act. The guide provides a detailed analysis of the U.S. Foreign Corrupt Practices Act (FCPA) and closely examines the SEC and DOJ approach to FCPA enforcement.

The guide provides helpful information to enterprises of all sizes. It addresses a wide variety of topics including who and what is covered by the FCPA's anti-bribery and accounting provisions; the definition of a "foreign official;" what constitutes proper and improper gifts, travel, and entertainment expenses; facilitating payments; how successor liability applies in the mergers and acquisitions context; the hallmarks of an effective corporate compliance program; and the different types of civil and criminal resolutions available in the FCPA context.

Public Company Accounting Oversight Board (PCAOB)

PCAOB to meet on November 28 to consider 2013 budget and strategic plan

The PCAOB has scheduled an open meeting for November 28 to consider adoption of its budget for the 2013 fiscal year and its related strategic plan.

The Sarbanes-Oxley Act of 2002 requires the PCAOB to establish a budget for each fiscal year no later than one month prior to the commencement of that fiscal year. The PCAOB fiscal year is the calendar year.

Additionally, the SEC's rule on the PCAOB budget requires the PCAOB to maintain a strategic plan. If the budget and strategic plan are approved by the board, the strategic plan will guide the board's use of resources funded by the 2013 budget.

American Institute of Certified Public Accountants (AICPA)

ARSC issues proposed SSARSs under clarity project

The AICPA's Accounting and Review Services Committee (ARSC) released for comment two proposed Statements on Standards for Accounting and Review Services (SSARSs) — Review of Financial Statements and Review of Financial Statements—Special Considerations. The proposed SSARS represent the redrafting of the preceding SSARSs to apply the ARSC’s clarity drafting conventions and also includes additional changes from existing standards.

The ARSC has separated the proposals in an attempt to make the clarified standards easier to use, understand, and implement. The proposed SSARS Review of Financial Statements addresses areas that are applicable to a basic review engagement. The proposed SSARS Review of Financial Statements—Special Considerations addresses areas that are encountered less frequently. The proposed SSARSs would supersede paragraphs 1.07 to 1.08 and 3.01 to 3.73 of SSARS No. 19, Compilation and Review Engagements.

Comment on the proposed SSARSs are due by April 26, 2013.

Edited by:

Brad Mescher
Director
Phone: 1-973-236-7261
Email: brad.mescher@us.pwc.com

Saira Gilani
Senior Manager
Phone: 1-973-236-5811
Email: saira.s.gilani@us.pwc.com

Flashline is a weekly alert highlighting current financial-reporting developments (including accounting, auditing and regulatory matters) and is produced by the National Professional Services Group of PwC. This publication has been prepared for general information on matters of interest only, and does not constitute professional advice on facts and circumstances specific to any person or entity. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication. The information contained in this material was not intended or written to be used, and cannot be used, for purposes of avoiding penalties or sanctions imposed by any government or other regulatory body. PwC, its members, employees and agents shall not be responsible for any loss sustained by any person or entity who relies on this publication.