US Week in Review - Week ending 20 March 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
In joint redeliberations, the IASB supported a single on-balance sheet model for lessee accounting while the FASB supported a dual on-balance sheet model. Despite this fundamental difference, the Boards reiterated their commitment to seek a converged solution. The Boards also indicated that they do not intend to significantly change lessor accounting. Instead, they supported retaining a dual classification model. The Boards also reached tentative decisions on lease term, a short-term lease exception and other ways to simplify their 2013 proposal. Our To the Point publication tells what you need to know about these decisions.
The Emerging Issues Task Force (EITF) reached a final consensus on the following issue:
- Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could be Achieved after the Requisite Service Period
The EITF reached a consensus-for-exposure on the following issue:
- Recognition of New Accounting Basis (Pushdown) in Certain Circumstances
The Task Force also discussed but didn't reach final conclusions on the following issues:
- Measuring the Financial Assets and the Financial Liabilities of a Consolidated Financing Entity
- Determining Whether the Host Contract in a Hybrid Financial Instrument Issued in the Form of a Share Is More Akin to Debt or to Equity
Our EITF Update publication explains what you need to know about these issues.
Standard Setter updates
Financial Accounting Standards Board (FASB)
FASB issues guidance for private companies on consolidation of variable interest entities
The FASB issued a new standard that allows eligible private companies to choose to be exempt from evaluating lessor entities in certain common control leasing arrangements for consolidation under the variable interest entity guidance. Our upcoming publication will provide more details.
FASB issues ASU on technical corrections and improvements to glossary terms
The Board issued new guidance designed to clarify the Master Glossary of the Codification, consolidate multiple instances of the same term into a single definition and make minor improvements to the Master Glossary. The FASB said the amendments are not expected to result in substantive changes to the application of existing guidance and did not provide transition guidance. The amendments are effective upon issuance.
18-19 March 2014 joint FASB-IASB meeting
Leases - See our To the Point publication above.
Insurance contracts - The IASB began redeliberations of its 2013 exposure draft with discussions of unlocking the contractual service margin under the building-block approach and using other comprehensive income for the effect of changes in the discount rates. Although the FASB has scaled back the scope of its insurance contracts project, members of the FASB and its staff listened to the discussion because they may address similar issues.
For details, see the FASB's Tentative Board Decisions.
Upcoming meetings and webcasts
26 March 2014 FASB meeting
The FASB is scheduled to discuss:
- Going concern
- Accounting for identifiable intangible assets in a business combination (PCC Issue 13-01A)
- Accounting for goodwill for public business entities and not-for-profits
The FASB also will decide whether to ratify the consensus on EITF Issue No. 13-D, Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period, and the consensus-for-exposure on EITF Issue No. 12-F, Recognition of New Accounting Basis (Pushdown) in Certain Circumstances.
For additional details, see the FASB's calendar.
3 April 2014 FASB webcast
The FASB will host a webcast, IN FOCUS: Board Member Perspective on Structured Data and U.S. Securities and Exchange Commission and Staff U.S. GAAP Taxonomy Updates,at 1 p.m. Eastern time. For details and registration, see the FASB site.
See the FASB's calendar for upcoming education sessions. No decisions are made at these sessions.
Securities and Exchange Commission (SEC)
SEC cybersecurity roundtable on 26 March
The SEC said panelists at its cybersecurity roundtable on 26 March 2014 will discuss how exchanges, market participants and public companies are evaluating and addressing cybersecurity threats and incidents. The roundtable, which begins at 9:30 a.m. Eastern time, is open to the public, and the live webcast will be available on the SEC's website.
Upcoming Thought Center webcasts and podcasts
EY Q1 2014 financial reporting update
In co-operation with Financial Executives International (FEI)
27 March 2014, 1 p.m. Eastern time