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CPA Financial Accounting Reporting And Overview Of FAR

CPA Financial Accounting Reporting And Overview Of FAR 

CPA Financial Accounting Reporting And Overview Of FAR : CPAs are facing unprecedented changes in financial reporting. Economic, regulatory, and global forces are demanding higher-quality reporting while standards are in continual flux. While the Financial Accounting Standards Board (FASB) is proposing significant changes to U.S. generally accepted accounting principles there is an ever-increasing pressure for differentiation between public and private entity standards. The information and resources here will help you stay informed of changes to accounting standards and provide you guidance to ensure high quality financial reporting.

CPA Financial Accounting Reporting And Overview Of FAR

FASB ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments Released

On June 16, 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The release of this new standard marks the end for accounting for credit losses using an incurred model. The standard will:

  • Apply to most debt instruments, trade receivables, lease receivables, reinsurance receivables, financial guarantee contracts and loan commitments.
  • Financial instruments measured at fair value, some equity instruments and available for sale debt securities will still be excluded.
  • Entities would recognize as an allowance the estimate of contractual cash flows not expected to be collected.
  • Entities would consider all available relevant information in making the estimate, including historical charge-offs and other past events, current conditions, and reasonable and supportable forecasts and their implications for expected credit losses.
  • Entities would revert to an unadjusted historical credit loss experience for the period beyond which it can make its reasonable and supportable projections.

FASB ASU No. 2016-02, Leases Released

On February 25, 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-02, Leases. The standard will require that lessees record nearly all leases on the balance sheet. Lessors will see some changes too, largely made to align with the revised lessee model and the FASB’s new revenue recognition guidance

More information is available in the AICPA’s Leases area of the Financial Reporting Center.

FASB ASU No. 2014-09, Revenue from Contracts with Customers Released

The Financial Accounting Standards Board (FASB) has issued Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers. The standard has completely rewritten the revenue recognition guidance contained in the Accounting Standards Codification.

CPA Financial Accounting Reporting And Overview Of FAR

This Manual was originally prepared by the staff of the Division of Corporation Finance to serve as internal guidance. In 2008, in an effort to increase transparency of informal staff interpretations, the Division posted a version of the Manual to its website. Because of its informal nature, the Manual does not necessarily contain a discussion of all material considerations necessary to reach an accounting or disclosure conclusion. Such conclusions about a particular transaction are very fact dependent and require careful analysis of the transaction and of the relevant authoritative accounting literature and Commission requirements. The information in this Manual is non-authoritative. If it conflicts with authoritative or source material, the authoritative or source material governs. The information presented also may not reflect the views of other Divisions and Offices at the Commission. The guidance is not a rule, regulation or statement of the Commission and the Commission has neither approved nor disapproved this information. The information included in this Manual may be updated from time to time and positions may change. As a result, the information in this manual may not be current.

CPA Financial Accounting Reporting And Overview Of FAR

TABLE OF CONTENTS

EXPLANATION OF ABBREVIATIONS

TOPIC 1: REGISTRANT’S FINANCIAL STATEMENTS
1100Financial Statements and Schedules in Registration and Proxy Statements
1200Age of Financial Statements in Registration or Proxy Statements
1300Periodic Reporting Requirements (Exchange Act Filings)
1400General Considerations (All Filings)
1500Interim Period Reporting Considerations
1600Selected Financial Data
TOPIC 2: OTHER FINANCIAL STATEMENTS REQUIRED
2000Businesses Acquired or to be Acquired
2100Disposition of a Business
2200Financial Statements of Target Companies in Form S-4
2300Real Estate Acquisitions and Properties Securing Mortgages
2400Equity Method Investments, Including Fair Value Option
2500Guarantors of Securities
2600Collateralizations
2700Credit — Third Party Financial Statements
2800Other Financial Statements
TOPIC 3: PRO FORMA FINANCIAL INFORMATION
3100Circumstances Requiring Pro Forma Presentations
3200Preparation Requirements — Form and Content
3300Special Problems and Issues
3400Special Applications
3500Projections and Financial Forecasts
3600Other
TOPIC 4: INDEPENDENT ACCOUNTANTS’ INVOLVEMENT
4100Qualifications of Accountants
4200Accountants’ Reports
4300Report on Internal Control over Financial Reporting
4400Review and Compilation Reports
4500Change in Accountants
4600Non-Reliance on Previously Issued Financial Statements or Related Audit Report or Completed Interim Review
4700“To Be Issued” Accountant’s Reports
4800Other Matters
TOPIC 5: SMALLER REPORTING COMPANIES
5100Definition and Eligibility
5200Other Eligibility Issues
5300Form and Content Disclosure Required by Regulation S-X are Not Applicable
TOPIC 6: FOREIGN PRIVATE ISSUERS & FOREIGN BUSINESSES
6000[Reserved]
6100Definitions and Basic Rules
6200General Financial Statement Requirements for Foreign Private Issuers
6300IFRS
6400Requirement for Reconciliation to U.S. GAAP
6500Content of Reconciliation to U.S. GAAP
6600Selection of a Reporting Currency
6700Price-Level Adjusted Financial Statements and Effects of Hyperinflationary Environments
6800Foreign Auditor Matters
6900[Reserved]
TOPIC 7: RELATED PARTY MATTERS
7100[Reserved]
7200Expenses Incurred on Behalf of Registrant
7300Transfers and Receivables to or from Shareholders
7400Components of Larger Entities
7500Compensation Issues
TOPIC 8: NON-GAAP MEASURES OF FINANCIAL PERFORMANCE, LIQUIDITY AND NET WORTH
8100Use of Non-GAAP Financial Measures
8200Ratio of Earnings to Fixed Charges
8300Tangible Book Value per Share
TOPIC 9: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND RESULTS OF OPERATIONS (MD&A)
9100MD&A Objectives
9200General Requirements
9300[Reserved]
9400Foreign Private Issuers
9500Critical Accounting Estimates
9600Related Party Transactions
9700Fair Value Measurements
9800Other Items
9900Additional Guidance
TOPIC 10: EMERGING GROWTH COMPANIES
10100Eligibility
10200Scaled Disclosure Provisions
10300Foreign Private Issuers
TOPIC 11: REPORTING ISSUES RELATED TO ADOPTION OF NEW ACCOUNTING STANDARDS
11100New Revenue Standard (FASB ASC Topic 606)
11200New Leasing Standard (FASB ASC Topic 842)
11300New Disclosures About Short-Duration Contracts For Insurance Entities (FASB ASC Topic 944)
TOPIC 12: REVERSE ACQUISITIONS AND REVERSE RECAPITALIZATIONS
12100General
12200Reporting Issues
TOPIC 13: EFFECTS OF SUBSEQUENT EVENTS ON FINANCIAL STATEMENTS REQUIRED IN FILINGS
13100General
13200Discontinued Operations
13300Changes in Segments
13400Change in the Reporting Entity or a Business Combination Accounted for in a Manner Similar to a Pooling of Interests
13500Stock Splits
13600Measurement Period Adjustments
TOPIC 14: TENDER OFFERS
14100Regulatory Schemes
14200Documents Filed
14300Cash Offer Financial Statement Requirements
14400Item 1010 of Regulation M-A: Financial Statements
TOPIC 15: EMPLOYEE STOCK BENEFIT PLANS
15100Filing Requirements of Form S-8 and Form 11-K
15200Exchange Act Age of Financial Statements Requirements
TOPIC 16: MULTIJURISDICTIONAL DISCLOSURE SYSTEM
16000General
16100MJDS Offerings — Eligibility Requirements
16200Registration and Periodic Reporting under the Exchange Act
16300Tender Offers
16400Canadian Regulation
16500Sarbanes-Oxley
16600Auditor Independence

CPA Financial Accounting Reporting And Overview Of FAR

PRIVATE COMPANY FINANCIAL REPORTING COMMITTEE (PCFRC)

The Financial Accounting Standards Board (FASB) embarked on a major initiative to further improve the FASB’s current standard-setting process. Under the initiative, the Private Company Financial Reporting Committee (PCFRC) was formed in June 2006 and held its first meeting in April, 2007. The PCFRC represents all non-public business entities regardless of size. Its members focus on how standard-setting affects day-to-day technical activities and procedures from a cost/benefit perspective. The PCFRC sets its own agenda and makes specific technical recommendations for possible modifications for private companies on existing or developing FASB standards. The PCFRC consists of 12 members plus a chair. The 12 members comprise four users, four preparers, and four CPA practitioners. Sponsored by the FASB, the PCFRC receives additional administrative support from the American Institute of Certified Public Accountants.

The PCFRC met in Norwalk, CT, June 28-29, 2012. At the June 28th session the PCFRC met with FASB staff. The staff provided updates on various projects including the following:

  • Nonpublic entity fair value measurement disclosures
  • Consolidations—principal vs. agent
  • Financial instruments
  • Presentation of comprehensive income
  • Leases
  • Investment property entities
  • Disclosure framework
  • Liquidation basis of accounting and going concern
  • Revenue recognition
  • Private company decision making framework.

On June 29th the PCFRC met with the Board of the FASB to provide input about private company views on various topics including the following:

  • General update and comments from FASB
  • Decision-making framework for private companies
  • Leases
  • Consolidation—principal vs. agent
  • Financial instruments: impairment
  • Disclosure framework
  • Nonpublic entity fair value measurement disclosures.

CPA Financial Accounting Reporting And Overview Of FAR

The FASB established the Small Business Advisory Committee (SBAC) in 2004 to obtain more active involvement by the small business community in the development of financial accounting and reporting standards. In 2016, the FASB shifted the primary focus of the SBAC to small public companies. The role of the SBAC is to:

  • Provide focused input and feedback from a small public company perspective, considering whether there are differences in that input for small public versus private company perspectives
  • Assist the FASB and its staff in their consideration of whether private company accommodations should be extended to others in the small business community (for example, banks and other small public companies)
  • Advise on other matters for which the FASB may seek guidance.

The SBAC comprises between 15 to 20 members who demonstrates (a) a keen interest in and knowledge of financial accounting and reporting matters, (b) experience working within the small business sector, (c) a commitment to improving financial reporting for users of financial statements, and (d) the ability to provide input on a wide variety of financial reporting matters.

CPA Financial Accounting Reporting And Overview Of FAR

The Not-for-Profit Advisory Committee (NAC) was established in October 2009. The NAC is a standing committee that works closely with the FASB in an advisory capacity to ensure that perspectives from the not-for-profit (NFP) sector are effectively communicated to the FASB on a timely basis in connection with the development of financial accounting and reporting standards. The principal responsibilities of the NAC are to:

  • Provide focused input and feedback relating to (a) the need for and relative priority of proposed projects, (b) conceptual and practical implications of proposals under development in active projects, (c) practice issues, including implementation issues arising from new standards and potential areas for improvement pertinent to the NFP sector, and (d) longer-term issues important to the NFP sector.
  • Assist the FASB and its staff with communication and outreach activities to the NFP sector on recent standards and other existing guidance, current and proposed projects, and longer-term issues. NAC members are encouraged to communicate with the NFP sector, both to educate the sector about the roles of the FASB and the NAC and to encourage the sector to communicate with the FASB on financial reporting matters.
  • Advise on other matters for which the FASB may seek guidance.

The NAC consists of 15 to 20 members who demonstrate (a) a keen interest in and knowledge of financial accounting and reporting matters, (b) experience working within the NFP sector, (c) a commitment to improving financial reporting for users of financial statements, and (d) the ability to provide input on a wide variety of financial reporting matters.

CPA Financial Accounting Reporting And Overview Of FAR : XBRL

XBRL, eXtensible Business Reporting Language, is a royalty-free, international information format designed specifically for business information, also referred to as ‘interactive data’ by the SEC. The idea behind XBRL is simple: instead of treating business information as a block of text – as in a printed paper document or a standard Internet page – it provides a unique, electronically readable tag for each individual disclosure item within business reports.

CPA Financial Accounting Reporting And Overview Of FAR

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