Flashline - Week ending May 22, 2014 (No. 2014-21)

  • Print-friendly version
Flashline 05/22/2014 by Assurance services
Flashline - Week ending May 22, 2014 (No. 2014-21)

At a glance

This week's PwC update on financial reporting developments includes: In the loop: How new accounting elections could affect your deal or IPO strategy... Webcast: Hot topics in earnings per share... FASB meetings and project updates... IFRS Foundation publishes 2013 annual report... IFRIC Update — May 2014... and more

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

This week's topics include:

  • In the loop: How new accounting elections could affect your deal or IPO strategy
  • Webcast: Hot topics in earnings per share – June 9
  • FASB meetings and project updates
  • IFRS Foundation publishes 2013 annual report
  • IFRIC Update — May 2014
  • IESBA proposes changes to certain non-assurance services provisions in Ethics Code
  • AICPA and NASBA publish seventh edition of the Uniform Accountancy Act
  • GASB issues exposure draft on fair value measurement and application
  • OMB releases final "Circular A-133 Compliance Supplement 2014"

PwC

In the loop: How new accounting elections could affect your deal or IPO strategy

We’ve launched a new publication series—In the loop—designed to provide executive-level insight into today’s top financial reporting and regulatory issues.

Our first issue discusses how changes in private company accounting could affect future deals or financing strategies. Executives should understand that new accounting alternatives could cause implications for public company buyers as well as private companies being acquired or undertaking a public offering.

Webcast: Hot topics in earnings per share – June 9

Join us for our upcoming "Hot topics in earnings per share" webcast on Monday, June 9 from 1:00 – 2:00 EDT. The webcast will include a discussion on several current and recurring hot topics related to the calculation of earnings per share including:

  • Non-controlling interests
  • Convertible securities and options or warrants issued by subsidiaries or equity method investees
  • Redeemable equity
  • Repurchases of preferred stock
  • Participating securities and the ‘two-class’ method
  • Contingent share arrangements, including share-based payment awards with performance or market conditions

This webcast will qualify for 1.0 CPE credit. We invite you to register for the webcast.

Financial Accounting Standards Board (FASB)

FASB meetings and project updates

Meeting summary: The FASB and IASB met on May 22. The boards discussed their project on leases. A summary of the decisions reached at the meeting will be posted to the FASB’s website as soon as it is available.

Next open board meeting: The FASB will meet on May 28 to discuss its projects on (1) financial statements of not-for-profit entities, and (2) disclosure framework: entity’s decision process. The FASB will also consider whether to add one or more new projects to its agenda that are primarily focused on simplifying U.S. GAAP. See the FASB’s website for further information on the meeting.

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

International Accounting Standards Board (IASB)

IFRS Foundation publishes 2013 annual report

The IFRS Foundation, the governing body of the IASB, has published its 2013 Annual Report. Among other things, the annual report highlights the Foundation’s standard-setting activities, including its efforts to promote a single set of global accounting standards. Also included are the IFRS Foundation’s audited financial statements, along with highlights of its funding and financial results.

IFRS Interpretations Committee

IFRIC Update — May 2014

The May 2014 edition of IFRIC Update provides a summary of the IFRS Interpretations Committee's May 13-14 meeting. The meeting included discussions of the Committee's current agenda items on:

  • IFRS 11, Joint Arrangements—analysis of implementations issues
  • IAS 12, Income Taxes—threshold of recognition of an asset in the situation in which the tax position is uncertain
  • IAS 19, Employee Benefits—remeasurement at a plan amendment or curtailment
  • IFRIC 14, IAS 19—The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction—availability of refunds from a defined benefit plan managed by an independent trustee
  • IAS 16, Property, Plant and Equipment, and IAS 2, Inventories—'core inventories'

Also covered were issues considered for annual improvements, agenda decisions, and discussion of other work in progress.

International Federation of Accountants (IFAC)

IESBA proposes changes to certain non-assurance services provisions in Ethics Code

The IFAC's International Ethics Standards Board for Accountants (IESBA) released for public comment an exposure draft titled Proposed Changes to Certain Provisions of the Code Addressing Non-Assurance Services for Audit Clients. The proposed changes aim to enhance the independence provisions in the Code of Ethics for Professional Accountants by:

  • Providing additional guidance and clarification regarding management’s responsibility when the auditor provides non-assurance services to an audit client
  • Providing enhanced guidance and clarification on the concept of “routine or mechanical” services relating to the preparation of accounting records and financial statements for non-public interest entity audit clients
  • Removing the provision that permits an audit firm to provide certain bookkeeping and taxation services to public interest entity audit clients in emergency situations

The IESBA is also proposing enhancements to the corresponding non-assurance services provisions in Section 291—Other Assurance Engagements with respect to assurance clients.

Comments are requested by August 18, 2014.

American Institute of Certified Public Accountants (AICPA)

AICPA and NASBA publish seventh edition of the Uniform Accountancy Act

The AICPA and the National Association of State Boards of Accountancy (NASBA) have published the seventh edition of the Uniform Accountancy Act (UAA) and its Model Rules. The UAA is a model licensing law developed to provide a uniform approach to regulation of the accounting profession by US states and territories. The new edition includes a broader definition of “attest” to include any examination, review, or agreed upon procedure engagement performed utilizing the Statement on Standards for Attestation Engagements (SSAE). A CPA firm mobility provision was also added that allows a CPA firm to provide attest services in another state where it is not registered and does not have a physical office if certain conditions are met.

Governmental Accounting Standards Board (GASB)

GASB issues exposure draft on fair value measurement and application

The GASB issued for public comment an exposure draft that addresses accounting and financial reporting issues related to fair value measurements. The proposal updates the GASB’s definition of fair value to be consistent with the FASB’s definition. It also sets forth what assets and liabilities should be measured at fair value, and what information about fair value should be disclosed in the notes to the financial statements.

Comments are requested by August 15, 2014.

Office of Management and Budget (OMB)

OMB releases final "Circular A-133 Compliance Supplement 2014"

The OMB has issued the 2014 version of OMB Circular A-133: Compliance Supplement. The supplement, which is published annually, is intended to assist auditors in planning and performing audits in accordance with the Single Audit Act and Circular A-133, “Audits of States, Local Governments, and Non-Profit Organizations.” It provides information for auditors to aid in understanding federal program objectives, procedures and compliance requirements, as well as audit objectives and suggested audit procedures for determining compliance with the requirements.

The 2014 version of the OMB Circular A-133: Compliance Supplement contains an appendix (Appendix 5) that includes a list of changes from the 2013 OMB Circular A-133 Compliance Supplement, dated March 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