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Private company insights: year-end reporting reminders for private companies

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How prepared are you to close the books on 2020? In this year’s edition of Private company insights, we provide a summary of everything you need to know as you wrap up your 2020 financial reporting, including COVID-19 considerations and new accounting standards now effective. Specifically, we provide key insights and resources for private company financial statement preparers.

Overview of key insights and resources included in report

Pandemic-related accounting and reporting

  • Accounting for funds received through the Paycheck Protection Program (PPP) program, including potential forgiveness under the Coronavirus Aid, Relief, and Economic Security (CARES) Act.
  • Understanding the accounting models for recognizing and measuring impairments of tangible, intangible and financial assets.
  • Considering the impact of the pandemic on income taxes, revenue recognition, inventories and debt.

New accounting standards effective in 2020

  • Relief from the Financial Accounting Standards Board (FASB) when accounting for the effects of reference rate reform, including the discontinuance of the London Interbank Offered Rate (LIBOR), the most widely-quoted interest rate benchmark in loan arrangements.
  • Changes to accounting models for share-based awards granted to vendors, distributors and customers, including recognition and measurement of these awards.
  • Streamlining of financial statement disclosures relating to fair value measurements.

On the horizon — private company standard setting developments

  • The FASB continues to remain focused on reducing the cost and complexity of financial reporting for private companies through the introduction of streamlined accounting standards, where appropriate. Recent proposals include:
    • Simplifying the model for considering goodwill impairment triggering events for certain private companies. Adoption is expected in the first quarter of 2021 and may impact your 2020 financial reporting.
    • Streamlining the revenue recognition guidance for private company franchisors when identifying performance obligations.

2020 was a challenging year and we hope this publication serves as a helpful resource as you wrap up the financial reporting season and look ahead to 2021. 

For a deeper discussion, please contact:

Tom (Sully) Sullivan, Jr.

Partner, National Quality Partner and PCS XLOS Quality Leader, PwC US

Email

Kassie Bauman

Managing Director, National Professional Services Group, PwC US

Email

Steve Dolph

Director, National Professional Services Group, PwC US

Email

Contact us

Shawn Panson

Shawn Panson

Private Leader, PwC US

Heather Horn

Heather Horn

US Strategic Thought Leader, National Professional Services Group, PwC US

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