This week's PwC update on financial reporting developments includes: FASB and IASB issue final standard on revenue recognition... Register for PwC's upcoming Revenue Recognition webcast series... Venezuelan exchange rates... Five megatrends and possible implications: Directors edition... Audit Committee Excellence Series... and more
PwC's weekly alert highlighting current financial reporting developments (including accounting, auditing and regulatory matters).
This week's topics include:
FASB and IASB issue final standard on revenue recognition
On May 28, the FASB and IASB issued their long-awaited converged standard on the recognition of revenue from contracts with customers. Those closely following the project know there are potentially significant changes coming for certain industries, and some level of change for almost all entities. Below are some of the areas that could create the most significant challenges for entities as they transition to the new standard.
Read PwC's In brief article for an overview of the new revenue recognition standard. Also, we encourage you to register for PwC’s revenue recognition webcast series in the PwC section below.
Register for PwC's upcoming Revenue Recognition webcast series
We invite you to join us for our upcoming two-part webcast series on the FASB and IASB’s converged revenue recognition standard. The first session, Thursday June 12 from 1:00-2:30pm EDT, will discuss the revenue recognition standard in detail— focusing on how the new guidance may affect how and when a company recognizes revenue. The second installment of the series, Thursday June 19 from 1:00-2:30pm EDT, will help you understand the pervasive business implications, as well as what you can do to prepare for implementation of the new standard. Each webcast will qualify for 1.5 CPE credit.
We invite you to pre-register for the webcast series through the CFOdirect Network.
Venezuelan exchange rates
In this special edition Quarter close video on Venezuelan exchange rates, PwC's Stephanie Stewart, John Bishop and John Horan discuss the reporting implications of the three exchange mechanisms administered by the Venezuelan government.
Companies may need to exercise considerable judgment to determine which rate to utilize to remeasure their bolivar denominated monetary assets and liabilities, and to record associated revenues and expenses. This video explores how to consider what rate to use and when using multiple rates may be appropriate. It also discusses consolidation guidance and provides our key takeaways.
Also, for further information on this issue, read Dataline 2014-17, Implications of recent events in Venezuela.
Five megatrends and possible implications: Directors edition
PwC’s Center for Board Governance released a “directors edition” of Five megatrends and possible implications. The publication looks at the complexities and interconnectedness of the megatrends, and the potential implications on business— now and in the future. It offers a high-level view of the megatrends for directors to discuss with their companies. The megatrends are:
Audit Committee Excellence Series—Achieving excellence: Financial reporting oversight
PwC’s Center for Board Governance issued its second edition of the Audit Committee Excellence Series (ACES). The second edition is titled, Achieving excellence: Financial reporting oversight, and it discusses the importance of press releases covering preliminary results, considerations for audit committees before releasing results, and tips for reviewing actual filings.
Board oversight of risk: Defining risk appetite in plain English
PwC’s Center for Board Governance released Board oversight of risk: Defining risk appetite in plain English. This board-level report provides an overview of the risk appetite process, the board’s role in risk appetite, and questions boards should consider asking management about risk appetite.
FASB meetings and project updates
Meeting summary: The FASB met on May 28 to discuss its projects on (1) financial statements of not-for-profit entities and (2) disclosure framework: entity’s decision process. See the FASB’s website for the board’s meeting summary.
Next open board meeting: The FASB will meet on June 4. The board plans to discuss its projects on (1) insurance—disclosures about short-duration contracts and (2) Accounting for financial instruments—classification and measurement. See the FASB’s website for further information on the meeting.
Project updates: The FASB has updated the summary of its project on financial statements of not-for-profit entities.
IASB Update — May 2014
This issue of IASB Update, issued by the IASB staff, provides a summary of the IASB’s May 20-22 meetings. Some of the topics discussed were: (1) insurance contracts, (2) comprehensive review of the IFRS for SMEs, (3) leases, (4) equity method of accounting, (5) Conceptual Framework, and (6) recognition of deferred tax assets for unrealized losses.
GASB votes to propose major improvements for reporting health insurance and other retiree benefits
The GASB voted unanimously to approve two exposure drafts (ED) intended to improve financial reporting by state and local governments of other postemployment benefits (OPEB), such as retiree health insurance. The GASB also approved a third ED that would establish requirements for pensions and pension plans that are outside the scope of the pension standards the GASB released in 2012.
The most significant effect of the OPEB EDs would be to require governments to recognize their net OPEB liabilities on the face of their financial statements—providing all financial statement users with a more comprehensive understanding of these significant OPEB promises than is currently available.
The EDs are expected to be available in mid-June on the GASB website. Stakeholders are encouraged to review the proposals and provide comments by August 29, 2014.
The table in the attachment lists meetings of standard-setting bodies, PwC webcasts and other events occurring in June 2014 that may be of interest to you. Click on the name of the meeting, webcast or event for more information. For additional events, see the events calendar on PwC's CFOdirect Network.