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ACCOUNTING AND SEC HEADLINES:

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Leases – FASB Discusses Common Control Arrangements 

As discussed in its “Summary of Decisions” publication, the FASB met on February 15, 2023, and redeliberated the proposed Accounting Standards Update, Leases (Topic 842): Common Control Arrangements, and reached a number of decisions, including that for arrangements between entities under common control, the FASB affirmed its decision to provide entities within the scope of paragraph 842-10-65-1(b) (that is, entities that are not public business entities, not-for-profit bond obligors, or employee benefit plans that file or furnish financial statements with or to the U.S. Securities and Exchange Commission) with a practical expedient to use written terms and conditions for: (1) determining whether a lease exists and, if so, (2) the classification and accounting for that lease.

The FASB reached a number of other decisions which are outlined in the Summary of Decisions.

Financial Assets and Liabilities – New Edition of Interpretation Published 

We have published a new edition of our Interpretation, Financial Assets and Liabilities — Sales, Transfers, and Extinguishments: Interpretations of U.S. GAAP. This new edition reflects the latest interpretive guidance on financial assets and liabilities thru FASB Accounting Standards Update No. 2022-06, Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848.

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AUDITING AND INTERNAL CONTROL HEADLINES: 

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Construction Contractors – New Edition of Knowledge-Based Audits of Construction Contractors and Related Entities Published 

We have published a new edition of Knowledge-Based Audits of Construction Contractors and Related Entities. This publication provides practitioners with an effective approach for conducting audits of nonpublic construction contractor entities.

• This new edition provides guidance on the implementation of the standards and rules promulgated by the ASB, as well as selected best practices based on the guidance promulgated by the Public Company Accounting Oversight Board (PCAOB) and other regulators. This guide has been updated to incorporate the provisions of the following ASB Statements on Auditing Standards (SASs):
• SAS No. 142, Audit Evidence (effective for periods ending on or after December 15, 2022);
• SAS No. 143, Auditing Accounting Estimates and Related Disclosures (effective for periods ending on or after December 15, 2023);
• SAS No. 144, Amendments to AU-C Sections 501, 540, and 620 Related to the Use of Specialists and the Use of Pricing Information Obtained From External Information Sources (effective for periods ending on or after December 15, 2023);
• SAS No. 145, Understanding the Entity and Its Environment and Assessing the Risks of Material Misstatement (effective for periods ending on or after December 15, 2023); and
• AICPA Ethics Interpretation, Information System Services (ET sec.1.295.145).

Health Care Entities – New Edition of Knowledge-Based Audits of Not-for-Profit Entities (through SAS-142) Published 

We have published a new edition of Knowledge-Based Audits of Not-for-Profit Entities (through SAS-142). 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 not-for-profit entities in accordance with auditing standards generally accepted in the United States of America (U.S. GAAS) and generally accepted government auditing standards.

This new edition includes revisions, updates, and enhancements to reflect current literature, standards, and guidance including:

• SAS No. 142, Audit Evidence; and
• AICPA Ethics Interpretation, Staff Augmentation Arrangements (ET sec. 1.275.007).

Health Care Entities – New Edition of Knowledge-Based Audits of Not-for-Profit Entities (through SAS-145) Published 

We have published a new edition of Knowledge-Based Audits of Not-for-Profit Entities (through SAS-145). 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 not-for-profit entities in accordance with auditing standards generally accepted in the United States of America (U.S. GAAS) and generally accepted government auditing standards.

This new edition includes revisions, updates, and enhancements to reflect current accounting authoritative literature including:

• SAS No. 142, Audit Evidence (effective for periods ending on or after December 15, 2022);
• SAS No. 143, Auditing Accounting Estimates and Related Disclosures (effective for periods ending on or after December 15, 2023);
• SAS No. 144, Amendments to AU-C Sections 501, 540, and 620 Related to the Use of Specialists and the Use of Pricing Information Obtained from External Information Sources (effective for periods ending on or after December 15, 2023);
• SAS No. 145, Understanding the Entity and Its Environment and Assessing the Risks of Material Misstatement (effective for periods ending on or after December 15, 2023); and
• AICPA Ethics Interpretation, Staff Augmentation Arrangements (ET sec. 1.275.007).

AICPA Peer Review Board – Meeting Highlights Published 

The AICPA has published meeting highlights from the November 16, 2022 meeting of the AICPA’s Peer Review Board. Among other things, the meeting included the approval of an omnibus enhancements and technical corrections exposure draft.

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