Financial Reporting | AccountingWEB

Financial Reporting

Debate on Global Accounting Standards: Rules Versus Principles

Harmonizing accounting standards among the United States and 95 other countries means agreeing to a common language for financial reporting.Advertisement

Accounting Software Aids Nations’ Stability and Financial Accountability

Not every financial-accountability software solution can claim to change how countries work. The Government Accountability Solutions from FreeBalance can. And it is finding a niche in developing countries as well as those undergoing reconstruction or restructuring.“What we do is combine multiple bank accounts in one, automate it and divide (fiscal) responsibility so one person can’t control everything,” Bruce Lazenby, President and CEO of FreeBalance told the Business Edge (Ontario, Canada). “This leaves a trail for an auditor.

A Closer Look at the First Mandatory E-filing System Using XBRL

The first mandatory e-filing system using XBRL will officially be launched on October 1. The system, known as the Call Report Modernization Project utilizes the Central Data Repository (CDR) a secure shared database containing the quarterly filings of the nation’s estimated 8,400 financial institutions. Call Reports collect the basic financial data from commercial banks in the form of balance sheets, income statements and supporting schedules. They are used to supervise and evaluate the financial condition of the institutions.

Small- and Medium-Sized Companies in UK Want to Halt Convergence

The Federation of Small Business (FSB) has joined the Institute of Chartered Accountants in England and Wales (ICAEW) in calling for a halt to use of international financial reporting standards for small and medium-sized entities (SMEs) in the UK, according to a report in Accountancy Age.

White Paper Makes the Business Case for XBRL in Non-technical Terms

XBRL, which stands for eXtensible Business Reporting Language, is a language for electronic communication of business and financial data. Although it is not yet the language of business, there are signs that it will be in the future. Most of the discussions about XBRL up to this point have been highly technical and not much use when talking about or even describing XBRL to non-technical staff, let alone clients. That is where this white paper The Business Case for XBRL from UBmatrix, comes in.

New Deadline For Accounting Method Changes

The Internal Revenue Service (IRS) last week issued new timelines for submitting accounting method change requests.

The Banking Industry Struggles with SFAS 133

The Federal Home Loan Bank of Dallas (FHLB Dallas) and the Federal Home Loan Bank of Atlanta (FHLB Atlanta) announced plans Monday to restate their financial statements for the years 2001 through 2004 and the first quarter of 2005. The Federal Home Loan Bank of Indianapolis (FHLBI) had announced its intention to issue restatements for the same periods on Friday.

International Financial Reporting Standards Draft Released

Initiated by a meeting between the U.S. Securities and Exchange Commission (SEC) chairman William Donaldson & EU Internal Market Commissioner Charlie McGreevy in April, the International Accounting Standards Board (IASB) and the U.S. Financial Accounting Standards Board (FASB) met together in London in June. The topic of discussion was the convergence of U.S. and International accounting standards.
Practice Management

Stock Option Studies and Options Expensing

Two studies have found connections between lucrative stock options and grants paid to chief executives as compensation and companies that report accounting irregularities, flawed accounting practices, or engage in risky business strategies.

Civil Complaint Against MBIA May Be Close

Federal and state authorities are reviewing a draft civil complaint against bond insurer MBIA Inc., the Wall Street Journal reported Thursday.The newspaper, citing people familiar with the matter, said authorities may file civil fraud charges connected with MBIA's accounting for reinsurance, with a settlement possible in coming weeks.Attorneys in New York Attorney General Eliot Spitzer's office and the Securities and Exchange Commission are reviewing the complaint, the Journal reported.Separately, the U.S.

FASB Issues Exposure Drafts on Accounting for Financial Assets & Instruments

The Financial Accounting Standards Board, on Thursday, issued a revised Exposure Draft, Accounting for Transfers of Financial Assets, Accounting for Servicing of Financial Assets and Accounting for Certain Hybrid Financial Instruments. All the proposed Statements would amend FASB Statement 140.

AICPA Issues Fair Value Interpretations

Two Interpretations of Statements on Auditing Standards have been issued by the AICPA. These interpretations concern the auditing of fair values or more specifically Auditing Interests in Trusts Held by a Third-Party Trustee and Reported at Fair Value; and Auditing Investments in Securities Where a Readily Determinable Fair Value Does Not Exist. The interpretations illuminate situations where simply receiving a confirmation of fair value from a third party is not enough audit evidence for a complete valuation.

Mark Your Calendar: Financial Control Management Conference

The industry’s only Financial Control Management Conference (FCMC) is scheduled for September 19 – 20 in Chicago, Illinois.

SEC Looking for Ways to Improve Regulatory System for Smaller Companies

The Securities and Exchange Commission’s (SEC) Advisory Committee on Smaller Public Companies on Tuesday, August 2, published a series of questions developed to help solicit input from the public, including investors and companies, on ways to improve the current regulatory system for smaller companies and to examine the impact of the Sarbanes-Oxley Act of 2002.“The Committee has done an outstanding job identifying vital areas for discussion and potential enhancement of the regulatory framework for smaller public companies,” SEC Acting Chairman Cynthia A. Glassman.

Financial Statements Study Finds Problems

RateFinancials has released the results of a two-year study that finds companies still take liberties in reporting their financials. In these overtly regulatory times, balance sheets and income statements still aren’t transparent even when prepared following generally accepted accounting practices (GAAP) standards that provide management with broad discretion at times. Although these statement inaccuracies may not violate GAAP standards, the company’s financial health may not be accurately reflected for intelligent investors and shareholders in clearly worded descriptions.

Deloitte’s Navistar Audit Being Investigated

Deloitte & Touche LLP is being investigated by the Public Company Accounting Oversight Board (PCAOB) for auditing discrepancies in their 2003 audit of Navistar Financial Corporation. The two-page order, issued in May, was inadvertently disclosed by the Securities and Exchange Commission (SEC) which oversees the PCAOB. Navistar Financial is a unit of Navistar International Corporation. “The order was misdirected to the public file,” said SEC spokesman John Heine in a statement to Bloomberg News.

Accounting and Ethics - Poverty in Africa and Corporate Governance

As world leaders met in Gleneagles, Scotland last week to discuss proposals to address poverty in Africa, questions were raised by many about accountability by African states and companies doing business in Africa. John Snow, US Secretary of the Treasury, addressed the Council on Foreign Relations about proposals for debt relief and financial aid to Africa. Snow said that he believed the long-term solution to poverty was sustained growth. But, he concluded “you’ve got to be able to trust the books. If you can’t trust the books, you don’t get investors.

Mark Your Calendar: XBRL in Government & Industry

A free public presentation on the use and benefits of eXtensible Business Reporting Language (XBRL) in government and industry is being held Tuesday, July 19 in Washington, D.C. The one-day event, “XBRL in Government and Industry,” is organized by XBRL-US, the U.S.

Companies Hold Differing Views on Value of Reinsurance

While high-profile insurers are using different accounting treatments to value reinsurance, the National Association of Insurance Commissioners (NAIC) is pushing for improved disclosure requirements to avoid misuse.Since American International Group Inc. restated its earnings by $3.9 billion in May, investigators have been taking a sharp look at how certain insurers account for a type of reinsurance that can be abused to hide losses or inflate reserves. AIG is accused of misusing finite reinsurance transactions to boost its financial statements rather than transferring actual risk. U.S.

Looking for Better Information on Intangibles

Some investors and business experts believe now may be a good time to debate whether intangible assets - such as research and development, brand recognition, software, customer lists and employee training - should be counted the same way as equipment and buildings on corporate balance sheets.Intangible investments, in R&D and advertising, for example, are counted as routine expenses under generally accepted accounting principles, which is set by the Financial Accounting Standards Board (FASB).


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