Flashline - Week ending October 3, 2013 (No. 2013-40)

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Flashline 10/03/2013 by Assurance services
Flashline - Week ending October 3, 2013 (No. 2013-40)

At a glance

This week's PwC update on financial reporting includes: Reminder: Leases webcast — October 9, 2013... The quarter close — Directors edition... PCC finalizes two private company standards; sends to FASB for endorsement... and more.

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

This week's topics include:

  • Reminder: Leases webcast — October 9, 2013
  • 10Minutes on strategic supply chain management
  • The quarter close — Directors edition
  • BoardroomDirect: Update on current board issues — September 2013
  • PCC finalizes two private company standards; sends to FASB for endorsement
  • FASB meetings and project updates
  • IASB proposes limited amendments to IFRS for SMEs
  • IFRS Foundation releases new IFRS for SMEs training material
  • IFRS for SMEs Update — September 2013
  • IFAC announces availability of three 2013 Handbooks

PwC

Reminder: Leases webcast — October 9, 2013

After extensive outreach and re-deliberation, the FASB and IASB issued a revised exposure draft on the new leasing proposal in May 2013 for comments. The proposal requires almost all leases to be on the balance sheet and creates two methods for income statement recognition. Comments were due by Friday September 13, 2013.

Our 60-minute webcast at 11:00 am ET on Wednesday, October 9 will analyze the comment letter responses to the boards’ revised exposure draft and provide insights to help you think through the nuances that might lead to unexpected financial results. Webcast participants can qualify to receive 1.0 CPE credit.

We invite you to pre-register for the webcast through the CFOdirect Network.

10Minutes on strategic supply chain management

New research shows that high-performing supply chains can achieve sales and revenue growth while managing costs. That sounds like a tall order, but there are things you can do now to manage your supply chain as a strategic asset that boosts performance and profitability. Our 10Minutes on strategic supply chain management highlights how your supply chain can move your business strategy forward and set you apart from the competition.

The quarter close — Directors edition

The quarter close – Directors edition is designed to keep directors informed about the latest accounting and financial reporting issues. We create this version specifically for audit committee members and financial experts, basing it upon The quarter close, which is intended primarily for CFOs and Controllers.

The Q3-2013 edition discusses the following items: (1) accounting and reporting issues for private companies that could impact public companies, (2) statement of cash flows, (3) entities under common control, (4) contingencies, (5) new vice-chairman at the FASB, (6) PCAOB proposal on improving auditor reporting, and (7) international developments on auditor rotation and retendering.

BoardroomDirect: Update on current board issues — September 2013

This issue of BoardroomDirect includes an article about the evolving landscape in board governance focusing on the results of PwC’s 2013 Annual Corporate Directors Survey. The newsletter also includes briefs on (1) the Dodd-Frank Act CEO pay ratio disclosure rule proposed by the SEC, (2) the SEC’s decision to revise the resource extraction payments rule, (3) Institutional Shareholder Services’ inclusion of director tenure issues in its policy survey, (4) FASB and IFRS Foundation XBRL taxonomy proposals, and (5) public reaction to the joint leases accounting standard proposal.

Financial Accounting Standards Board (FASB)

PCC finalizes two private company standards; sends to FASB for endorsement

On October 1, the Private Company Council (PCC) voted to finalize two alternatives within U.S. GAAP for accounting for interest rate swaps and, separately, accounting for goodwill in a business combination for private companies. The FASB will discuss the proposed alternatives and also consider the applicability of these alternatives to publicly traded companies and not-for-profit organizations in the coming weeks. If the FASB decides to endorse the alternatives, they will be issued as final Accounting Standards Updates.

  • GAAP alternative — Accounting for Certain Receive-Variable, Pay-Fixed Interest Rate Swaps would give private companies, other than financial institutions, the option to use a simplified hedge accounting approach to account for certain types of interest rate swaps that are entered into for the purpose of economically converting variable rate interest payments to fixed-rate payments. The alternative would also extend the exemption from certain fair value disclosures to private companies for which such swaps are their only derivatives.
  • GAAP alternative — Accounting for Goodwill Subsequent to a Business Combination would permit a private company to subsequently amortize goodwill over a period of ten years, or less under certain circumstances, and to apply a simplified impairment model to goodwill.

FASB meetings and project updates

Meeting summary: The FASB met on October 2 and ratified the two consensuses-for-exposure reached at the September 13, 2013 EITF meeting and decided to expose them for public comment for a period of 60 days. The board also discussed its project on transfers and servicing: repurchase agreements and similar transactions. See the FASB’s website for a summary of the decisions reached at the meeting.

Next open board meeting: The FASB will meet on October 9 to discuss its projects on (1) not-for-profit financial reporting: financial statements and (2) disclosure framework. See the FASB’s website for more information on the meeting.

Project updates: The FASB has updated the summaries of its projects on:

International Accounting Standards Board (IASB)

IASB proposes limited amendments to IFRS for SMEs

The IASB published for public comment an exposure draft proposing limited amendments to the IFRS for SMEs. Most of the proposed amendments clarify existing requirements or add supporting guidance, rather than propose changes to the underlying requirements in the IFRS for SMEs. Consequently, for most SMEs, the proposals are expected to improve understanding of the existing requirements, without having a significant effect on the entity’s financial reporting practices and financial statements.

Comments on the exposure draft are requested by March 3, 2014.

IFRS Foundation releases new IFRS for SMEs training material

To assist companies in applying the IASB's stand-alone standard on IFRS for SMEs, the IFRS Foundation has an ongoing project to develop a set of free training materials (one for each section of the IFRS for SMEs). It recently released Module 26 — Share-based Payment, which specifies the accounting for share-based payment transactions. Share-based payment transactions can be equity-settled, cash-settled or can provide a choice of whether the entity settles the transaction in cash (or other assets) or by issuing equity instruments.

IFRS for SMEs Update — September 2013

This edition of the IASB's IFRS for SMEs Update includes items on (1) the upcoming Exposure Draft of proposed amendments to the IFRS for SMEs, (2) new English-language training module 26: Share-based Payment, (3) the status of IFRS for SMEs translations, and (4) where to obtain IFRS for SMEs materials.

International Federation of Accountants (IFAC)

IFAC announces availability of three 2013 Handbooks

The IFAC announced the availability of the 2013 editions of the handbooks from the International Auditing and Assurance Standards Board (IAASB), International Ethics Standards Board for Accountants (IESBA), and International Public Sector Accounting Standards Board (IPSASB).

  • 2013 Handbook of International Public Sector Accounting Pronouncements
    This handbook includes chapters 1-4 of the Conceptual Framework for General Purpose Financial Reporting by Public Sector Entities, which were issued in January 2013. It also includes an updated list of those International Public Sector Accounting Standards (IPSASs) that are applicable to annual financial statements covering periods beginning on or after January 1, 2013, and a list of those IPSASs that are applicable to annual financial statements covering periods beginning on or after January 1, 2014.
  • 2013 Handbook of International Quality Control, Auditing, Review, Other Assurance, and Related Services Pronouncements
    This handbook contains two new standards issued by the IAASB since the 2012 edition: International Standard on Auditing 610 (Revised 2013), Using the Work of Internal Auditors and International Standard on Review Engagements 2400 (Revised), Engagements to Review Financial Statements.
  • 2013 Handbook of the Code of Ethics for Professional Accountants  
    Includes the entire IESBA Code of Ethics for Professional Accountants, effective January 1, 2011. The handbook also includes three final pronouncements related to: breaches of a requirement of the Code; conflicts of interest; and the definition of “engagement team.” These pronouncements will take effect in 2014.

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. It is for general information purposes only, and should not be used as a substitute for consultation with professional advisors. To access additional content on financial reporting issues, visit CFOdirect Network (www.cfodirect.pwc.com), PwC’s online resource for financial executives.