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ACCOUNTING AND SEC HEADLINES:
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FASB Standards – FASB Seeks Public Comment on Proposal to Delay Effective Date for Private and Certain Public Companies
The FASB issued a proposed Accounting Standards Update (ASU) that would grant private companies, most not-for-profit organizations, and certain small public companies additional time to implement FASB standards on current expected credit losses (CECL), leases, and hedging. Stakeholders are encouraged to review and provide comment on the proposed ASU by September 16, 2019.
The proposed ASU describes a new FASB philosophy that extends and simplifies how effective dates for major standards are staggered between larger public companies and all other entities. Those other entities include private companies, smaller public companies, not-for-profit organizations, and employee benefit plans. Under this philosophy, a major standard would first be effective for larger public companies. For all other entities, the FASB would consider requiring an effective date staggered at least two years later. Generally, it is expected that early application would continue to be permitted for all entities.
"Based on what we’ve learned from our stakeholders, including the Private Company Council and the Small Business Advisory Committee, private companies, not-for-profit organizations, and some small public companies would benefit from additional time to apply major standards,” stated FASB Chairman Russell G. Golden. “This represents an important shift in the FASB’s philosophy around effective dates, one we believe will support better overall implementation of these standards.”
Based on that philosophy, the FASB proposes to amend the effective dates for hedging, leases, and CECL as follows (assumes calendar-year end):
Hedging: SEC Filers, January 2019; All Other Public Business Entities, January 2019, Private and All Others, January 2021.
Leases: SEC Filers, January 2019; All Other Public Business Entities (Including Employee Benefit Plans and Not-for-Profit Conduit Bond Obligors that file or furnish financial statements with or to the SEC), January 2019, Private and all Others, January 2021.
CECL: SEC Filers (Except SRCs, January 2023), January 2020; All Other Public Business Entities, January 2023, Private and all Others, January 2023.
Regulation S-K – SEC Publishes Technical Correction on Previously Issued Final Rule
The SEC has issued a technical correction to its previously published final rule,
FAST Act Modernization and Simplification of Regulation S-K. This document:
- Reinstates certain item headings in registration statement forms under the Securities Act of 1933 that were inadvertently changed;
- Relocates certain amendments to the correct item numbers in these forms and reinstates text that was inadvertently removed;
- Corrects a portion of the exhibit table in Item 601(a) of Regulation S-K to make it consistent with the regulatory text of the amendments; and
- Corrects certain typographical errors and a cross-reference in the regulatory text of the amendments.
Regulatory Reform – SEC Commissioner Hester M. Peirce Discusses Regulatory Reform
SEC Commissioner Hester M. Peirce recently discussed SEC regulatory reform efforts. Peirce indicated that the “regulation of public companies is a part of our jurisdiction that is crying out for reform. We have seen the trend of companies waiting longer to go public and have been asking ourselves what we can do to encourage companies to go public earlier and to remain public. We want to ensure that retail investors can participate in the growth of these companies.”
Public Accounting Report – PAR Professors Survey 2019 Part 1: Academic Accounting Rankings
We have published a new edition of the Public Accounting Report (PAR),
PAR Professors Survey 2019 Part 1: Academic Accounting Rankings. This new edition includes the rankings of U.S. academic accounting programs, based on the opinions of the nation’s accounting professors participating in PAR’s
38th Annual Professors Survey. Part Two of the survey, coming in September 2019, will feature professors’ opinions on campus recruiting and competing for top accounting students.
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AUDITING AND INTERNAL CONTROLS HEADLINES:
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Engagement Standards – 2019 Edition of Engagement Standards Attestation Engagements-PCAOB Published
We have published the 2019 edition of
Engagement Standards Attestation Engagements-PCAOB. This new edition helps a user quickly locate guidance and resolve practice issues relating to attestation engagements conducted in accordance with the attestation rules promulgated by the PCAOB. This update includes:
- Coverage/discussion of PCAOB attestation standards, including the attestation rules for audits of broker-dealers issued through 6/30/19; and
- Updated illustrations of the applicable forms, practice aids, and practitioner’s reports.
See our Literature Update for complete details.
Less Complex Entities – 2019 Edition of Knowledge-Based Audits Published
We have published the 2019 edition of
Knowledge-Based AuditsTM of Less Complex Entities. This publication is designed to help the auditor efficiently and effectively perform financial statement audits and, when applicable, audits of internal control over financial reporting, of nonpublic less complex entities in accordance with auditing standards generally accepted in the United States of America (U.S. GAAS).
This edition of the publication includes revisions, updates, and enhancements to reflect current accounting authoritative literature including, among other things, the revised AICPA Code of Professional Conduct (Code); and ET Section 1.295,
Nonattest Services, and practice points regarding AICPA Statement on Auditing Standards (SAS) No. 134,
Auditor Reporting and Amendments, Including Amendments Addressing Disclosures in the Audit of Financial Statements, and SAS No. 135,
Omnibus Statement on Auditing Standards – 2019, which do not provide for early implementation.
See our Literature Update for complete details.
Public Accounting Report – PAR Professors Survey 2019 Part 1: Academic Accounting Rankings
We have published a new edition of the Public Accounting Report (PAR),
PAR Professors Survey 2019 Part 1: Academic Accounting Rankings. This new edition includes the rankings of U.S. academic accounting programs, based on the opinions of the nation’s accounting professors participating in PAR’s
38th Annual Professors Survey. Part Two of the survey, coming in September 2019, will feature professors’ opinions on campus recruiting and competing for top accounting students.
Portfolio Company Investments – AICPA Accounting and Valuation Guide Published
The AICPA has published the Accounting and Valuation Guide,
Valuation of Portfolio Company Investments of Venture Capital and Private Equity Funds and Other Investment Companies. This guide has been developed by the AICPA PE/VC Task Force.
This guide provides guidance and illustrations for preparers of financial statements, independent auditors, and valuation specialists regarding the accounting for and valuation of portfolio company investments of venture capital funds, private equity funds and other investment companies. The valuation guidance in this guide is focused on measuring fair value for financial reporting purposes.
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GOVERNMENT HEADLINES:
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Professional Standards – GAO Issues Professional Standards Update No. 74
The Government Accountability Office (GAO) has published Professional Standards Update (PSU) No. 74, covering standards published from April 2019 through June 2019.
PSUs provide brief summaries of recently-issued standards of major auditing and accounting standard setting bodies, including, among others, the GAO, the FASB, GASB, AICPA, and PCAOB. Auditors may use the GAO’s Generally Accepted Governmental Auditing Standards (Yellow Book) in connection with professional standards issued by the GAO and other authoritative bodies.
The GAO revised the Yellow Book in 2018, with major changes from the 2011 version. Key changes include a new format that differentiates requirements from application guidance, updated independence requirements for auditors related to financial statement preparation, revised peer review requirements for audit organizations, and new guidance to address waste and abuse as defined under government auditing standards.
The Yellow Book 2018 Revision is effective for financial audits, attestation engagements, and reviews of financial statements for periods ending on or after June 30, 2020, and for performance audits beginning on or after July 1, 2019. Early implementation is not permitted.
PSUs inform Yellow Book users of important changes to professional requirements and to highlight some key points of recent standards. PSUs do not establish new professional standards and do not reflect GAO official views on these requirements. PSUs also do not contain a complete summary of the standards. Users should refer to the original, authoritative standards for details on those standards and for purposes of implementing them.
Public Accounting Report – PAR Professors Survey 2019 Part 1: Academic Accounting Rankings
We have published a new edition of the Public Accounting Report (PAR),
PAR Professors Survey 2019 Part 1: Academic Accounting Rankings. This new edition includes the rankings of U.S. academic accounting programs, based on the opinions of the nation’s accounting professors participating in PAR’s
38th Annual Professors Survey. Part Two of the survey, coming in September 2019, will feature professors’ opinions on campus recruiting and competing for top accounting students.
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