FASB

A&A

A Conversation with Bruce Pounder: The Impact of Convergence on U.S. GAAP

Internationally recognized convergence expert, Bruce Pounder, explains what we can expect to see in financial reporting and the financial statements of the future. To start off, can you briefly describe the phenomenon of "Convergence?"The word Convergence refers to the process of eliminating differences in accounting standards among countries. But Convergence also refers to the goal of that process - the absence of differences in accounting standards among countries. So Convergence is both a process and a goal.
A&A

FASB seeks comments on FAS 140-d

The Financial Accounting Standards Board has issued proposed Staff Position (FSP) FAS 140-d, "Accounting for Transfers of Financial Assets and Repurchase Financing Transactions." The Board currently seeks written comments on the proposed FSP, which addresses the accounting for the transfer of financial assets and a subsequent repurchase financing.The FSP focuses on the circumstances that would permit a transferor and a transferee to separately evaluate the accounting for a transfer of a financial asset and a repurchase financing under FASB Statement No.
A&A

FIN 48 from different perspectives

Financial Accounting Standards Board Interpretation No. 48 (FIN 48), Accounting for Uncertainty in Income Taxes, is intended to substantially reduce uncertainty in accounting for income taxes. Its implementation and infrastructure requirements, however, generate a great deal of uncertainty. This feature provides an overview of FIN 48, addresses some of its federal and international tax issues, as well as issues arising at the state and local level.
A&A

Profits To Be Lost Under New Accounting Rules

Accounting-rule makers are planning to unveil a draft plan to rework financial statements, the data that millions of investors use every day when deciding whether to buy or sell stocks, bonds and other financial instruments, the Wall Street Journal reports. One possible result will be the elimination of net income or net profit, the bottom-line figure showing what is left after expenses have been met and taxes paid. It is the item many investors look to as a key gauge of corporate performance and one measure used to determine executive compensation.
A&A

Smith Appointed to FASB

The Financial Accounting Standards Board (FASB) appointed Lawrence W. Smith to a five-year term as a member effective July 1, 2007. Smith will replace Edward W. Trott who will retire from the board on June 30, 2007. Board members are appointed by the Financial Accounting Foundation (FAF). Smith is currently director of FASB's Technical Application and Implementation Activities, and chairman of the Emerging Issues Task Force. Prior to joining FASB in 2002, Smith worked at KPMG for 25 years. The seven-member FASB is led by Chairman Robert Herz.
Community News

Judith O’Dell to Chair Private Company Financial Reporting Committee

Judith H. O’Dell, CPA, has been named Chair of the new Private Company Financial Reporting Committee (the Committee), part of the Financial Accounting Standards Board (FASB) and the American Institute of Certified Public Accountants (AICPA) initiative to improve the FASB’s standard-setting process to include the needs of private companies.
A&A

Changes to a Derivatives Accounting Rule Sought

A new derivatives accounting rule may be changed to reflect investor concerns. Reuters reports that the Financial Accounting Standards Board (FASB) has voted 6-1 to release a draft of Financial Accounting Standard 155 (FAS 155) with changes that exclude some mortgage-backed securities from compliance. If approved, the changes would allow the banks, insurance companies and other market players investing in about $3.5 trillion of these mortgage-backed securities (MBS) from being required to note interest-rate-driven gains and losses on their income statements, according to Reuters.
Tax

International Economic Center, the OECD, Takes Aim at U.S. Tax Policy

The Organisation for Economic Co-operation and Development (OECD), signalled a growing interest in international tax with the publication of a draft of guidelines on tests that investment managers in the UK need to meet before profits from offshore hedge funds can remain outside of the UK’s taxing authority, hedgeweek.com reports.
Tax

Social Security: A Perennial Election Issue

With just two weeks until the Nov. 7 congressional elections, President Bush called Social Security reform one of the “big items” he wants to tackle next year, sparking debate among politicians on both sides.Bush said that he believes “that a worker, at his or her option, ought to be allowed to put some of their own money . . . in a private savings account, an account that they call their own,” according to the Washington Post.Democrats jumped on the comment as a chance to remind voters that his reform ideas never made it to the legislative stage because they were so unpopular.
A&A

New FASB Exposure Drafts Address Not-for-Profit Accounting, Usability Issues

On Monday, the Financial Accounting Standards Board (FASB) issued two Exposure Drafts intended to improve the accounting and disclosures for mergers and acquisition (M&A) activities among not-for-profit organizations. The deadline for submitting comments on the new Exposure Drafts is January 29, 2007.“The not-for-profit sector makes up a sizable portion of reporting entities and GDP in the U.S.
Practice Management

PCAOB Drafts Rewrites to AS2; Senior Administrators Moving On

Signs that the Public Company Accounting Oversight Board (PCAOB) is entering a new phase of its development came recently when the Board submitted a draft of changes to the Auditing Standard 2 (AS2) to the Securities and Exchange Commission (SEC) that are said to modify confusing definitions and eliminate the need for separate internal control and financial statements audits.
A&A

Accounting Rules Allow “Spring-loading,” “Bullet-dodging” Option Grants

The government will not have any accounting basis for enforcement actions against companies for “spring-loading” or “bullet-dodging” stock option grants, according to Scott Taub, deputy chief accountant for the U.S. Securities and Exchange Commission (SEC ). Taub spoke at a Financial Accounting Standards Board (FASB) advisory council meeting in New York on Tuesday, Reuters reports.
A&A

FASB Improves Employer Pension & Postretirement Plan Accounting

The Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards No. 158, Employers Accounting for Defined Benefit Pension and Other Postretirement Plans last week, making it easier for users of financial information to understand and assess an employer’s financial position and its ability to fulfill benefit plan obligations.
A&A

FASB enhances guidance for measuring fair value

The Financial Accounting Standards Board (FASB) has issued Statement of Financial Accounting Standards No. 157, Fair Value Measurements, providing enhanced guidance for using fair value to measure assets and liabilities. More than 40 current accounting standards within generally accepted accounting principles (GAAP) require or permit entities to measure assets and liabilities at fair value.
A&A

Going Into Effect September 15

Two pronouncements, FAS 155: Accounting for Certain Hybrid Financial Instruments and FAS 156: Accounting for Servicing of Financial Assets by the Financial Accounting Standards Board (FASB) become effective September 15, 2006.
A&A

Option ARMs Bring Pain to Borrowers and Mortgage Industry

Some mortgage industry experts estimate that as much as one-half trillion dollars’ worth of adjustable rate mortgage loans (ARMs) are scheduled to reset this year, the Washington Post reports. Many will be the nontraditional Option ARMs which allow borrowers to choose to make minimum payments, less than the actual interest on the mortgage, for up to 60 months. The portion of the interest not paid in the Option ARM is added to the principal of the mortgage, and the borrower’s total debt just gets bigger each month, a negative amortization.
A&A

Accounting Insight & Analysis for the Post-SOX Environment

On September 5, 2006, BNA, the largest independent publisher of nonpartisan news and information in Washington, D.C., will launch its new Accounting Policy & Practice Series, providing subscribers in the accounting, legal and financial professions with a new dimension of objective and insightful guidance into decision-making in the post-Sarbanes-Oxley (SOX) environment.Advertisement
A&A

New Texas Margin Tax -- Business or Income Tax

Candidates for governor in Texas last week reacted to the Financial Accounting Standards Board’s (FASB) conclusion that the new Texas margin tax was an income tax under Financial Accounting Standards (FAS) 109 “because the tax is based on some measure of income.” FASB declined to set up a project to give advice on the matter.Kathy Walt, spokeswoman for Republican Governor Rick Perry, and former state Comptroller Democrat John Sharp, who headed the commission that recommended the tax, said that FASB was providing instructions for accounting purposes only, according to the Houston Chro
Practice Management

Collections of Articles and Pronouncements Available

The Financial Accounting Standards Board (FASB) and the Professional Accountants in Business (PAIB) Committee of the International Federation of Accountants (IFAC) have announced the availability of their 2006 collections.Advertisement
A&A

Participants Sought for 2006 Annual FASAC Survey

The Financial Accounting Standards Board (FASB) is soliciting constituent views on the FASB’s current priorities, future financial reporting issues, international convergence and educational efforts.

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