US Week in Review - Week ending 3 July 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
Our June edition is designed to help you identify certain changes in tax law and other events when they occur so the accounting can be reflected in the appropriate period. This edition includes certain enacted and effective tax legislation, global tax treaties, regulatory developments and other items through 30 June 2012 to consider as you prepare your tax provision. We've also listed our tax alerts and other publications that provide more detail on the topics we discuss.
Our latest SEC in Focus newsletter summarizes developments relating to Securities and Exchange Commission (SEC) matters, including items we have not previously reported in Week in Review. This issue highlights the SEC staff's focus on addressing implementation questions about the Jumpstart Our Business Startups Act.
The standard-setting activities of the FASB and the IASB on their joint projects continue to move forward. The Boards are expected to soon begin redeliberations of their second exposure draft on revenue recognition, and they continue to redeliberate other significant projects. Our Joint Project Watch publication is designed to give you a snapshot of key developments from a US GAAP perspective, along with our observations about the potential implications for companies.
The Financial Accounting Standards Board (FASB) issued an exposure draft that would require entities to prepare financial statements on a liquidation basis when management stops making significant decisions about furthering the operations of an entity or limits its decision to those necessary to carry out a liquidation plan. Our To the Point publication summarizes what you need to know about the proposal.
The FASB proposed requiring all entities - public, private and not-for-profit - to provide liquidity risk disclosures in their audited financial statements. Entities that meet the proposed definition of a financial institution would also have to provide interest rate risk disclosures. Our Technical Line publication tells you what you need to know about the proposal.
Standard Setter updates
Financial Accounting Standards Board (FASB)
There are no meetings scheduled for the week of 2 July 2012.
Upcoming meetings and webcasts
he Board is scheduled to meet on 9 and 11 July 2012. See the FASB calendar for details.
See the FASB calendar for upcoming education sessions. No decisions are made at these sessions.
Securities and Exchange Commission (SEC)
SEC to meet in August on conflict minerals, resource extraction disclosures and general solicitation
The SEC said it will hold an open meeting on 22 August 2012 to consider adopting final rules related to conflict minerals and resource extraction disclosures and to consider proposing rules allowing general solicitation and advertising in securities offerings under Rule 506 of Regulation D and 144A of the Securities Act.
The conflict minerals and resource extraction disclosures are required by Sections 1502 and 1504, respectively, of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The SEC proposed the rules in December 2010, but delayed adoption due to stakeholder concerns about the scope and complexity of the proposals. The general solicitation and advertising rules are required by the Jumpstart Our Business Startups Act.
American Institute of Certified Public Accountants (AICPA)
AICPA issues going concern auditing standard
The AICPA issued Statement on Auditing Standards (SAS) No. 126, The Auditor's Consideration of an Entity's Ability to Continue as a Going Concern (Redrafted), which applies to all audits of financial statements except those based on the assumption of liquidation.
SAS 126 states that the auditor's responsibility is to evaluate whether there is substantial doubt about the entity's ability to continue as a going concern for a reasonable period of time (i.e., a period not to exceed one year after the date of the financial statements). The evaluation is based on the auditor's knowledge of relevant conditions or events that exist at or have occurred before the date of the auditor's report. This information is obtained from audit procedures planned and performed to achieve audit objectives that are related to management's assertions embodied in the financial statements.
SAS 126 is effective for audits of financial statements for periods ending on or after 15 December 2012.
Upcoming Thought center webcasts and podcasts
Supreme Court Ruling on the Health Care Law: what companies need to consider
17 July 2012, 1:00 p.m. Eastern time
Evolving role of the CFO: the inaugural launch of FEI's CFO Community of Interest
Hosted by Ernst & Young LLP
18 July 2012, 2:00 p.m. Eastern time