This week's PwC update on financial reporting includes: FASB issues final private company accounting alternatives for goodwill and certain interest rate swaps... IFRS Foundation seeks comments on proposed IFRS Taxonomy 2013 interim releases... AICPA issues new Q&As on conflict minerals reports... FASB meetings and project updates... and more.
PwC's weekly alert highlighting current financial reporting developments (including accounting, auditing and regulatory matters).
This week's topics include:
FASB issues final private company accounting alternatives for goodwill and certain interest rate swaps
On January 16, the FASB issued Accounting Standards Update (ASU) No. 2014-02, Accounting for Goodwill, and ASU No. 2014-03, Accounting for Certain Receive-Variable, Pay-Fixed Interest Rate Swaps – Simplified Hedge Accounting Approach. These standards provide nonpublic entities with accounting alternatives which are intended to (1) simplify the goodwill impairment model and (2) make it easier for certain interest rate swaps to qualify for hedge accounting.
The final standards will be effective for annual periods beginning after December 15, 2014, and interim periods within annual periods beginning after December 15, 2015. Early adoption will be permitted.
Read our In brief article for a summary of the new standards.
FASB issues final guidance on accounting for investments in qualified affordable housing projects
The FASB has published Accounting Standards Update No. 2014-01, Accounting for Investments in Qualified Affordable Housing Projects, to codify a final consensus reached by the Emerging Issues Task Force (EITF) at its November 2013 meeting. The new guidance is expected to enable more entities to qualify for the proportional amortization method to account for affordable housing project investments than the number of entities that currently qualify for the effective yield method. The Task Force concluded that the income statement presentation of the investment’s performance net of taxes along with the other amendments in the ASU will help enhance financial statement users’ understanding of the nature of qualified affordable housing project investments and their effect on the financial position and results of operations of a reporting entity.
The ASU is effective for public business entities for annual periods and interim reporting periods within those annual periods, beginning after December 15, 2014. For all entities other than public business entities, the amendments are effective for annual periods beginning after December 15, 2014, and interim periods within annual reporting periods beginning after December 15, 2015. Early adoption is permitted.
Also see the November 2013 edition of PwC’s EITF observer for a high-level overview of this ASU.
FASB meetings and project updates
Meeting summary: The FASB met on January 15. The board discussed its project on reporting discontinued operations. See the FASB’s website for a summary of the decisions reached.
Next open board meeting: The following board meetings are scheduled for next week:
See the FASB’s website for further information on the meetings.
Project updates: The FASB has updated the summary of its projects on:
IFRS Foundation seeks comments on proposed IFRS Taxonomy 2013 interim releases
The IFRS Foundation, the oversight body of the IASB, published the Proposed Interim Release Package 2 on the IFRS Taxonomy 2013. IFRS Taxonomy interim releases contain additional taxonomy concepts that reflect new IFRSs and improvements to IFRSs published by the IASB, thereby allowing entities wishing to report electronically using the latest IFRSs to do so without the need for these entities to create their own taxonomy concepts.
The Proposed Interim Release Package 2 incorporates three interim release documents for public consultation: (1) IFRS 9, Financial Instruments (Hedge Accounting), (2) Annual Improvements to IFRSs 2010-2012 Cycle, and (3) Common practice telecommunications and real estate activities.
Comments on the exposure drafts are requested by February 14, 2014.
AICPA issues new Q&As on conflict minerals reports
The AICPA Conflict Minerals Task Force has published a set of questions and answers (Q&As) to provide non-authoritative guidance relating to the Independent Private Sector Audit (IPSA). The Q&As address (1) the objectives of an IPSA, (2) criteria for IPSA as an attestation examination engagement, including appropriate criteria, sample procedures, and what evaluations are outside the scope of an IPSA, and (3) various CPE requirements and topics relevant to an IPSA.
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.