Accounting Research Manager^TM

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ACCOUNTING AND SEC HEADLINES:
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National Market Systems – SEC Proposes Changes to NMS Plan Fee Amendments

The SEC proposed to require an amendment to a national market system plan (NMS plan) that would establish or change a fee or other charge (Proposed Fee Change) to be subject to the standard procedure for NMS plan amendments. The proposal would rescind a rule exception that allows an NMS plan amendment to be effective upon filing if it establishes or changes a fee or other charge. The standard procedure requires publication of the amendment, an opportunity for public comment, and SEC approval by order before the amendment can become effective.

Rule 608(b)(3)(i) of Regulation NMS currently permits a Proposed Fee Change to become effective immediately upon filing with the SEC, and an NMS plan may begin charging the new fee prior to an opportunity for public comment and without agency action. By changing the timing of effectiveness, the proposed rescission of Rule 608(b)(3)(i) provides investors and other market participants an opportunity to voice their views about a Proposed Fee Change prior to the time they are charged a new or changed fee.

Comments on the proposal are due 60 days from publication in the Federal Register.

Financial Instruments – New Edition of GAAP Update Service Discusses FASB Proposal on Credit Losses on Financial Instruments

We have published a new edition of the GAAP Update Service. This new edition discusses proposed ASU Codification Improvements to Topic 326, Financial Instruments – Credit Losses. The FASB proposed a handful of changes to the new credit loss accounting standard that governs the accounting for loan loss allowances and bad debt reserves (Topic 326). The proposed changes would affect four topics:

• Purchased financial assets with credit deterioration;
• Troubled debt restructurings;
• Financial assets secured by collateral maintenance provisions; and
• Disclosures related to accrued interest receivables.

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AUDITING AND INTERNAL CONTROLS HEADLINES:
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Real Estate Entities – 2019-2020 Edition of Knowledge-Based Audits of Real Estate Entities Published

We have published the 2019-2020 edition of Knowledge-Based AuditsTM of Real Estate Entities. This new edition provides guidance on the implementation of the standards and rules promulgated by the ASB, as well as best practices based on the guidance promulgated by the PCAOB and other regulators. This guide has been updated to include practice points on the ASB's Statement on Auditing Standards (SAS) No. No. 134, Auditor Reporting and Amendments, Including Amendments Addressing Disclosures in the Audit of Financial Statements, SAS No. 135, Omnibus Statement on Auditing Standards – 2019, and SAS No. 137, The Auditor’s Responsibilities Relating to Other Information Included in Annual Reports, which do not provide for early implementation; as well as accounting requirements of the FASB.

See our Literature Update for complete details.

Single Audits – New Edition of Knowledge-Based Single Audits Updates for the 2019 Compliance Supplement

In July 2019, the Office of Management and Budget (OMB) issued the 2019 Compliance Supplement. The 2019 Compliance Supplement is unlike previous annual updates to the Supplement in that in accordance with the President’s Management Agenda CAP Goal No.8, each Federal agency has been mandated by OMB to limit the number of compliance requirements subject to the audit to six, with the exception of the Research and Development cluster which has been permitted to identify seven compliance requirements as subject to the audit. This has changed the scope of many single audits performed for periods ending on or after June 30, 2019.

The KBA Supplemental Guide – Updates from the 2019 Compliance Supplement has been issued to assist the auditor in performing single audits under the updated compliance supplement and discusses the new “pick six” approach as well as the corrected version of the 2019 Compliance Supplement that was issued on September 20, 2019.

See our Literature Update for complete details.

GAAS Practice Manual – 2020 Edition of GAAS Practice Manual Published

We have published the 2020 GAAS Practice Manual. This new edition has been updated for new pronouncements through the issuance of Statement on Auditing Standards (SAS) No. 133 titled, “Auditor Involvement With Exempt Offering Documents”; Statement on Standards for Attestation Engagements (SSAE) No. 18 titled, “Attestation Standards: Clarification and Recodification”; and Statement on Standards for Accounting and Review Services (SSARS) No. 24 titled, “Omnibus Statement on Standards for Accounting and Review Services—2018.”

See our Literature Update for complete details.

Employee Benefit Plans – New Edition of GAAS Update Service Discusses SAS 136

We have published a new edition of the GAAS Update Service. This new edition and the September 15, 2019, October 15, 2019, and October 30, 2019 GAAS Updates cover in detail the requirements and guidance in SAS 136, as codified in AU-C Section 703. Specifically, this GAAS Update discusses written representations from management and forming an opinion, and auditor’s reports, on ERISA plan financial statements.

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GOVERNMENT HEADLINES:
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Capitalized Interest – New Edition of Governmental GAAP Update Service Discusses GASB 89

We have published a new edition of the Governmental GAAP Update Service. This new edition discusses GASB No. 89, Accounting for Interest Cost Incurred before the End of a Construction Period. GASB 89 amends GASB Cod. Sec. 1400.102, replaces pars. 120-.121 and deletes three related questions in the Implementation Guide upon implementation.

This edition of the Governmental GAAP Update Service discusses the provisions of GASB 89 and potential pitfalls to avoid. The effective date and transition provisions are for reporting periods beginning after December 15, 2019. For December 31 year-ends, beginning on January 1, 2020. Luckily, the provisions are to be implemented prospectively, providing some relief because of the potential pitfalls.

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ACCOUNTING RESEARCH MANAGER CUSTOMER SERVICE:
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