US Week in Review - Week ending 11 October 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

    Joint Project Watch - September 2012

    The standard-setting activities of the FASB and the IASB on their joint projects continue to move forward. The Boards are redeliberating their second exposure draft (ED) on revenue recognition, and are preparing to issue a second ED on leases in early 2013. 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.

    Standard Setter updates

    Financial Accounting Standards Board (FASB)

    FASB issues two proposals

    The FASB issued two Proposed Accounting Standards Updates (ASUs) on EITF consensuses-for-exposure it ratified at its 27 September 2012 meeting.

    Comments are due by 10 December 2012. For more details, see our September 2012 EITF Update publication.

    Final September EITF minutes

    The final minutes of the September EITF meeting are now available. At this meeting, the EITF reached three final consensuses on the following issues:

    • Not-for-Profit Entities: Classification of the Sale Proceeds of Donated Financial Assets in the Statement of Cash flows
    • Subsequent Accounting for an Indemnification Asset Recognized at the Acquisition Date as a Result of a Government-Assisted Acquisition of a Financial Institution
    • Accounting for Fair Value Information That Arises after the Measurement Date and Its Inclusion in the Impairment Analysis of Unamortized Film Costs

    The EITF also reached two consensuses-for-exposure that have been issued as Proposed ASUs.

    10 October 2012 FASB meeting

    The FASB discussed its project on accounting for financial instruments: impairment.

    For details, see the FASB Action Alert.

    Upcoming meetings and webcasts

    15, 17, 18 October 2012 joint FASB-IASB videoconference meetings

    The Boards are scheduled to discuss their projects on:

    • Insurance contracts
    • Revenue recognition

    15, 17, 19 October 2012 FASB meeting

    The FASB is scheduled to discuss:

    • Insurance contracts
    • Accounting for financial instruments: impairment
    • Accounting for financial instruments: classification and measurement

    For additional details, see the FASB calendar.

    Education sessions

    See the FASB calendar for upcoming education sessions. No decisions are made at these sessions.

    Securities and Exchange Commission (SEC)

    Confidential registration statements must be submitted through EDGAR beginning Monday

    The SEC's new electronic process for submitting confidential draft registration statements will be mandatory when the new EDGAR Filer Manual for Release 12.2 is posted to the Federal Register on Monday, 15 October.

    The Division of Corporation Finance has issued guidance for emerging growth companies that currently have draft registration statements under review to help them use EDGAR for their next confidential submission. Instructions and Frequently Asked Questions are available on the SEC's website.

    Other reminders

    Highly inflationary economies

    At its most recent meeting, the Center for Audit Quality (CAQ) SEC Regulations Committee’s International Practices Task Force (Task Force) reported that Venezuela and Belarus should continue to be considered highly inflationary economies, as defined under US GAAP. Additionally, the Task Force noted that the three-year cumulative inflation rate for the Democratic Republic of the Congo (DRC), which was previously reported as having a highly inflationary economy, is projected to drop to less than 40% by the end of 2012. As a result, companies should closely monitor the DRC to determine when it is appropriate to cease highly inflationary accounting.

    The Task Force also highlighted several countries that either have projected three-year cumulative inflation rates between 70% and 100% or have experienced a significant increase in inflation during the current period. They include Ethiopia, Sudan, Guinea, Iran and Yemen.

    As always, the Task Force said there may be other countries with cumulative inflation rates of 100% or more that should be monitored that are not mentioned in the highlights because the sources used by the Task Force do not include inflation data for all countries. Accordingly, companies should closely monitor the inflation rates in economies in which they operate.

    For further information see the Task Force Highlights.

    Upcoming Thought center webcasts and podcasts

    Evolving role of today's CFO
    Featured in FEI's CFO Community of Interest
    Hosted by Ernst & Young LLP
    16 October 2012, 12:00 p.m. Eastern time

    Tackling the top divestiture challenges
    Hosted by Ernst & Young LLP Transaction Advisory Services
    18 October 2012, 12:00 p.m. Eastern time


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