FASB

A&A

FASB Close to New Pension Reporting Rule

Companies will be required to report their pension assets and investment strategies under a new rule being considered by the Financial Accounting Standards Board (FASB).One major change is that companies will be required to describe their pension holdings — reporting on the proportion of stocks, bonds, real estate, private equity and other investments, the FASB decided last Wednesday.
A&A

FASB Defers FAS 150 Provisions Related to Mandatorily Redeemable Noncontrolling Interests

Provided by PricewaterhouseCoopers, CFOdirect NetworkAt Wednesday's Financial Accounting Standards Board meeting, the Board decided to defer the provisions of paragraphs 9 and 10 of FAS 150, Accounting for Certain Financial Instruments with Characteristics of Both Liabilities and Equity, (and related guidance in the appendices) as they apply to mandatorily redeemable noncontrolling interests.
A&A

Stock Option Expensing to Become Mandatory in 2005

The Financial Accounting Standards Board met on October 29 to put some of the final touches on its decisions towards mandating expensing of stock options just like any other compensation - an issue which has been steadily gaining momentum for over ten years.
A&A

FASB Defers Date For Accounting Guidance on Variable Interest Entities

At its Board meeting on October 8, the FASB decided to defer to the fourth quarter from the third quarter the implementation date for Interpretation No. 46, Consolidation of Variable Interest Entities, issued earlier this year. This deferral only applies to variable interest entities that existed prior to February 1, 2003.
A&A

FASB Proposes Improvements to Pension Accounting

The Financial Accounting Standards Board (FASB) has issued an Exposure Draft, Employers’ Disclosures about Pensions and Other Postretirement Benefits that would improve financial statement disclosures for defined benefit plans. The project was initiated by the FASB earlier this year in response to concerns raised by investors and other users of financial statements about the need for greater transparency of pension information.
A&A

FASB to Propose Additional Disclosure for Acquisitions

The Financial Accounting Standards Board plans to take up the issue of accounting for acquisitions. Several issues associated with disclosure of transactions relating to acquisitions were decided last month and reported in a recent FASB Action Alert.The Board has proposed that, among other items of disclosure, companies provide separate disclosure of revenue and net income of acquired companies, if practicable, for at least the period from the date of acquisition to the end of the fiscal year of acquisition.
Practice Management

FASB Addresses, Delays Stock Option Rule Setting

The Financial Accounting Standards Board met yesterday to address a myriad of complicated issues surrounding the expensing of stock options. The definitive decision reached at the end of the meeting: delay the issuance of rules by 6-9 months.FASB has been under pressure from a number of groups, including Congress, to define how companies should expense stock options granted to employees. The sticky point, everyone agrees, is honing in on an appropriate valuation method. The widely used Black-Scholes method has often been criticized as an imperfect tool to value options.
A&A

Full Text FASB Statements Now Available For Free

The Financial Accounting Standards Board has brought a midsummer's gift to the accounting profession. The status, summary, and full text of all statements are now available online, and free of charge.For years, practitioners, educators and students have grumbled about the lack of free access to the rules and regulations governing the profession they are serving. FASB has responded accordingly. All statements are presented in PDF format, requiring the reader to have Adobe Acrobat 5.0 or higher installed on his or her computer.
A&A

Stock Options: New Valuation Model, New Approaches

Stock options continue in the news with an advisory board urging FASB to consider a different valuation model, and Microsoft coming out with an announcement that will significantly impact employees and recruits.
A&A

Congress Gains Support in Stock Option Fight

FASB Chairman Robert Herz last week urged lawmakers to stay out of the standard-setting business, but now it seems the legislation that threatens FASB’s independence is gaining support on both sides of the aisle.The “Broad-Based Stock Option Plan Transparency Act" was introduced in March by Rep. David Dreier (R-Calif.) and Rep. Anna Eshoo (D-Calif.) and currently has 44 co-sponsors.
A&A

Stock Option Expensing Subject of House Hearing

Robert Herz, chairman of the Financial Accounting Standards Board (FASB) strongly objected this week to proposed legislation that would place a three-year moratorium on the expensing of stock options. He said the action "would be in direct conflict with the expressed needs and demands of investors." "The moratorium would establish a potentially dangerous precedent," Herz said in testimony before a House panel.
A&A

FASB Agrees to Rethink Pension Rule Change

Under increasing pressure, the Financial Accounting Standards Board (FASB) agreed to take another look at its proposed rule that would change the way some pensions are valued which could have had a possible negative impact on some companies’ balance sheets. Industry groups decried the proposed rule change, which would have required companies to use an interest rate tied to a market index—a one-year Treasury bill, for instance—to place a value on their pension liabilities.
A&A

FASB Grapples With Valuation of Stock Options

How to place a value on stock options is just one of the issues the Financial Accounting Standards Board (FASB) is challenged with as it moved this week to allow companies to reverse stock option expenses on their financial statements when an employee later gives up the options. The Board is working to develop new stock option accounting rules. Most of corporate America is deeply concerned and adamantly opposed to the Board’s move last month to require the expensing of options.
A&A

FASB Approves Expensing of Stock Options

The debate on mandatory expensing of stock options moved center stage last week when the Financial Accounting Standards Board (FASB) voted unanimously to require companies to expense employee stock options. It could take up to a year before the final draft is released with the new rule taking effect sometime in 2004. In 1994 the board considered adopting the expensing method but encountered resistance from corporate groups as well as Congressional members. It seems likely that will happen again. Last month, 15 U.S.
A&A

SEC Formally Reaffirms FASB, Approves PCAOB

Responding to a requirement of the Sarbanes-Oxley Act, The Securities and Exchange Commission has reaffirmed that the Financial Accounting Standards Board has met the criteria needed to continue to be recognized as the accounting standard setting body.FASB Chairman Robert Herz said, "We appreciate the continued confidence and support of the SEC and look forward to working closely and effectively with the Commission and its staff, as well as with the new Public Company Accounting Oversight Board in ensuring quality fi
A&A

Tell The Truth, Unless it Hurts - Stock Option Accounting

The following is a guest editorial by, Raymond L. Dever, CPA (Retired)Tell the Truth, Unless it Hurts - Stock Option Accounting. Or, unless it is politically dangerous. "We can't stand by and let accountants wearing green eyeshades decide who is going to get the American dream," says Senator Barbara Boxer (D-California) before a Silicon Valley lobbying organization.
A&A

Stock Options And Pensions Added to FASB Agenda

Responding to requests from investors, financial analysts and other users of financial information, the Financial Accounting Standards Board (FASB) added to its agenda two projects that will seek to improve the accounting and disclosures relating to stock-based compensation and pension costs.Amongst other issues, the project on stock-based compensation will address whether to require that the cost of employee stock options be treated as an expense.
A&A

US Senators Urge FASB to Reconsider Stock Options Stance

A bi-partisan coalition of United States Senators, led by former accountant Sen. Mike Enzi (R-WY), is urging the Financial Accounting Standards Board to more fully consider the question of expensing stock options, and suggested that the deliberation process currently underway is “basically flawed.”The Federal Accounting Standards Board Invitation to Comment specifically stated that it was not interested in views on whether stock options granted to employees result in compensation expense for the issuing entity.
A&A

Pitt’s Final Days Reveal Move to Assert More Control Over FASB

An article in the Wall Street Journal ("FASB Recognition Stalled Amid Fight Over Control," February 21, 2003) reveals that in the weeks leading up to his departure, Harvey Pitt pushed for and failed in an attempt to establish greater SEC control over the Financial Accounting Standards Board.Mr. Pitt’s plan was for the SEC to hold tighter control over FASB, the make up of the membership of the Financial Accounting Foundation, the selection of the members of the FASB, and the standard setting agenda of the organization.
A&A

Help is on The Way For Real Estate Time-Share Reporting

Professionals dealing with real estate time sharing transactions will soon get additional reporting guidance by both the AICPA and the Financial Accounting Standards Board.The AICPA has released a Statement of Position (SOP), "Accounting for Real Estate Time-Sharing Transactions." The proposed SOP would provide guidance on a seller's accounting for real estate time-sharing transactions in financial statements prepared in conformity with generally accepted accounting principles (GAAP).

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