US Week in Review - Week ending 14 August 2014
The US Week in Review highlights this week’s developments and emerging issues in the financial reporting world and gives you direct access to relevant technical accounting guidance and thought leadership produced by EY.
What’s new from EY
The FASB decided to issue a final standard that would require insurers to make additional disclosures about their short-duration insurance contracts in their annual and interim financial statements. Our To the Point publication tells you what you need to know.
The FASB added several projects to its agenda and to that of the EITF at its latest agenda prioritization meeting. Several of these projects are part of the Board’s simplification initiative. Projects were added to the FASB’s agenda to address accounting for income taxes and to simplify the presentation of debt issuance cost, the measurement date for defined benefit plans and the balance sheet classification of debt. Projects were added to the EITF’s agenda to address the fair value hierarchy levels for certain investments measured at net asset value and the effects on historical earnings per unit of master limited partnership dropdown transactions. See our To the Point for details.
The new revenue recognition standard issued by the FASB and the IASB creates a comprehensive source of revenue guidance for all entities in all industries. Our Technical Line considers key implications of the revenue recognition standard for asset managers. It also provides an overview of the revenue recognition model and highlights considerations in applying the model for the industry. This publication supplements our Technical Line, A closer look at the new revenue recognition standard, and should be read in conjunction with it.
We will issue additional publications for other industries in the coming weeks.
The GASB has proposed changing how state and local governments calculate and report the costs and obligations associated with defined benefit other postemployment benefit (OPEB) plans. Government employers would have to record an OPEB liability in their accrual-basis financial statements for defined benefit plans in a manner more similar to private sector entities. The proposal would make a government’s obligations more transparent, and many governments would likely report a much larger OPEB liability than they do today. Our Technical Line publication analyzes the proposed guidance and highlights key changes from current practice.
We have updated our Financial reporting developments publication on lease accounting to address new guidance issued by the FASB in Accounting Standards Update (ASU) 2014-05, Service Concession Arrangements (primarily codified in ASC 853, Service Concession Arrangements). Arrangements within the scope of Accounting Standards Codification (ASC) 853 are not within the scope of ASC 840, Leases. Other updates include additional considerations for evaluating non-performance covenants when classifying and measuring a lease and illustrative guidance for determining the inputs to a sales-type lease. Refer to Appendix D of the publication for a detailed list of updates.
Our New revenue recognition standard for telecommunications companies webcast is scheduled for 9 September from 10 a.m. to 11 a.m. Eastern time. If you are unable to attend the webcast, an audio replay will be available on 11 September. EY panelists will discuss highlights of the new standard, key implications of the new revenue model for telecommunications companies and practical application issues.
Standard Setter updates
Financial Accounting Standards Board (FASB)
FASB issues final guidance on EITF issue
The FASB issued ASU 2014-14, Receivables - Troubled Debt Restructurings by Creditors (Subtopic 310-40): Classification of Certain Government-Guaranteed Mortgage Loans upon Foreclosure (a consensus of the FASB Emerging Issues Task Force). The ASU requires that, upon foreclosure, a guaranteed mortgage loan be derecognized and a separate other receivable be recognized when specific criteria are met.
13 August 2014 FASB meeting
Agenda prioritization - See our To the Point above.
Insurance: disclosures about short-duration contracts - See our To the Point above.
The Board also discussed its Financial instruments: impairment project. For details, see the FASB’s Tentative Board Decisions.
20 August 2014 FASB meeting
The Board is scheduled to discuss its projects on Financial instruments: classification and measurement and Disclosure framework: disclosure review–defined benefit plans. For details, see the FASB’s calendar.
See the FASB's calendar for upcoming education sessions. No decisions are made at these sessions.
Upcoming Thought Center webcasts and podcasts
New revenue recognition standard for telecommunication companies
9 September 2014, 10 a.m. Eastern time
CFO: need to know quarterly webcast series
18 September 2014, 12 p.m. Eastern time
EY Q3 2014 financial reporting update
18 September 2014, 2 p.m. Eastern time