US Week in Review - Week ending 3 April 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
Our latest newsletter summarizes developments relating to SEC matters, including certain items we have not previously reported in Week in Review. This issue highlights the SEC's progress on rulemaking and other initiatives, including its recent cybersecurity roundtable, and includes a reminder for companies facing their first conflict minerals reporting deadline. We also discuss the FASB's new definition of a public business entity and how it could affect registrants that are required to include financial statements of other entities in their SEC filings.
The SEC held a roundtable this week at which the Commissioners and staff discussed with public and private sector representatives the cybersecurity challenges faced by market participants. The Commissioners also asked for public comment. This To the Point publication summarizes key topics discussed at the roundtable and summarizes congressional action on cybersecurity.
Standard Setter updates
Financial Accounting Standards Board (FASB)
Upcoming meetings and webcasts
4 April 2014 FASB meeting
The FASB is scheduled to discuss:
- Accounting for financial instruments: classification and measurement
- Investment companies: disclosures about investments in another investment company
- Disclosure framework: entity's decision process
For additional details, see the FASB's calendar.
See the FASB's calendar for upcoming education sessions. No decisions are made at these sessions.
Securities and Exchange Commission (SEC)
Begin preparing disclosures for the new revenue standard
Once the FASB and the IASB issue a final revenue recognition standard, public companies will need to provide disclosures in registration statements and periodic reports filed with the SEC about how they will be affected. Public companies may want to consider preparing their initial SEC Staff Accounting Bulletin (SAB) Topic 11.M disclosures now because the standard may be issued before they need to file their next registration statement or periodic report.
SAB Topic 11.M requires disclosure of the potential effects of recently issued accounting standards, to the extent the effects are known. Under this requirement, companies should consider making the following disclosures within management's discussion and analysis and the financial statements:
- A brief description of the standard, the date adoption is required and, for registrants applying IFRS, the date that the registrant plans to adopt, if earlier
- A discussion of the methods of adoption allowed by the standard and the method the registrant expects to use, if determined
- A discussion of the effect the standard is expected to have on the financial statements or, if the effect isn't known or reasonably estimable, a statement to that effect
- Disclosure of other significant matters that the registrant believes might result from adopting the standard (e.g., planned or intended changes in business practices)
Initially, we anticipate companies may not know or be able to make a reasonable estimate of the effect the new standard will have on their financial statements and will make a statement to that effect. As a reminder, the SEC staff expects a company's disclosures to evolve in each reporting period as more information about the effects of the new standard becomes available.
Investor Advisory Committee to meet next week
The SEC Investor Advisory Committee will meet on 10 April 2014 to consider subcommittee recommendations that the SEC include additional investor protections in its final crowdfunding rules. Specifically, the subcommittee recommended that the SEC further limit the maximum amount that can be invested, require intermediaries to create tools to ensure that investment limits are not exceeded and require intermediaries to monitor issuers' compliance with SEC rules. SEC Commissioners and the Investor Advocate also will address the group during the meeting, which will be webcast on the SEC's website.
International Accounting Standards Board (IASB)
IFRS for SMEs Update
The IFRS for SMEs Update is a staff update on the latest news surrounding IFRS for Small and Medium-sized Entities (IFRS for SMEs).
Upcoming Thought Center webcasts and podcasts
Let's talk: sustainability Q2 2014
A new point of view for business leaders
23 April 2014, 12 p.m. Eastern time