US Week in Review - Week ending 15 November 2012
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 Ernst & Young.
Ernst & Young publications
The Financial Accounting Standards Board (FASB) tentatively decided to require management to assess a company's ability to continue as a going concern and the need for disclosure when certain levels of uncertainty exist. This would be a change because today's requirement to assess a company's ability to continue as a going concern rests primarily with auditors. The FASB expects to issue a proposal in the first quarter of 2013. Our To the Point publication summarizes what you need to know about the tentative decisions.
While convergence was a high priority for the FASB and the IASB in 2012, differences continue to exist between US GAAP and IFRS. In this guide, we provide an overview by accounting area of where the standards are similar, where differences are commonly found in practice, and how and when certain differences are expected to disappear.
Our FRD, Accounting for reinsurance, which was first published in December 1993, has been updated. The updates include changes to the deposit accounting and long duration chapters, along with references to the FASB Accounting Standards Codification.
Our FRD, Issuer's accounting for debt and equity financings, is designed to help readers navigate the various accounting literature that should be considered in accounting for debt and equity financings and includes a discussion of specific transactions.
Standard Setter updates
Financial Accounting Standards Board (FASB)
14 November 2012 FASB meeting
The FASB discussed its projects on:
- Presentation of comprehensive income: reclassification out of accumulated other comprehensive income
- Technical corrections - next phase
- Insurance contracts
For details, see the FASB Action Alert.
Upcoming meetings and webcasts
19-20 November 2012 joint FASB-IASB videoconference meetings
The Boards are scheduled to discuss the following projects:
- Revenue recognition
- Accounting for financial instruments: impairment
- Insurance contracts
20 November 2012 FASB meeting
The Board is scheduled to discuss the following projects:
- Insurance contracts
For additional details, see the FASB calendar.
See the FASB calendar for upcoming education sessions. No decisions are made at these sessions.
Securities and Exchange Commission (SEC)
SEC and Justice Department release FCPA guidance
The SEC and the Department of Justice (DOJ) jointly released A Resource Guide to the U.S. Foreign Corrupt Practices Act (FCPA), which is intended to facilitate compliance with the FCPA. The guide describes the statutory requirements and the SEC's and DOJ's enforcement approaches and priorities, including examples of matters that they have not pursued.
SEC issues regulatory relief for companies affected by Hurricane Sandy
The SEC issued an order extending until 21 November the filing deadline on any reports by companies affected by Hurricane Sandy that were due between 29 October 2012 and 20 November 2012, as long as the companies disclose that they are relying on the order and explain why they couldn't meet the original deadline. The order provides similar relief for entities that furnish proxy information and transmit reports to investors under the Investment Company Act of 1940.
The SEC also directed the staff to take the position that relying on the order to extend the deadline would not affect a company's form eligibility and that affected companies that are unable to file by the updated due date of 21 November 2012 may rely on Exchange Act Rule 12b-25 to extend the due date further. The order also allows for an exemption to auditor independence requirements as they relate to reconstruction of lost accounting records for audit clients.
International Federation of Accountants/International Auditing and Assurance Standards Board (IFAC/IAASB)
IAASB Staff Q&As - Applying ISQC 1
The IAASB has issued questions and answers to highlight how the design of International Standard on Quality Control (ISQC) 1 issued by the IAASB under the Clarity Project, enables it to be applied in a manner proportionate with the nature and size of a firm.
IESBA Staff Q&As - Implementing the Code of Ethics Part II
The International Ethics Standards Board for Accountants (IESBA) has issued questions and answers to support the adoption and implementation of the IESBA's Code of Ethics for Professional Accountants. These Q&As are additional to the 2010 Q&As and cover issues related to materiality, partner rotation, public interest entities and network firms.
Upcoming Thought center webcasts and podcasts
IFRS 9 Financial instruments: what to expect from changes to hedge accounting
27 November 2012, 11:00 a.m. Eastern time
Conflict minerals: new rules and next steps
27 November 2012, 2:00 p.m. Eastern time