The New England Accounting Advisor

For 2019, public and private companies alike are grappling with major accounting updates from the Financial Accounting Standards Board (FASB). Public companies tackled the changes to the leasing standard, which required so much time and energy that the FASB agreed to push back the effective date for private companies. Meanwhile, private companies worked through the updates to the long-awaited revenue recognition changes under ASC Topic 606.

Topics: accounting, Paul Languirand, audit, FASB, Financial Accounting Standards Board, Auditing Standards

The Financial Accounting Standards Board (FASB) affirmed its decision to delay the effective dates of several complex accounting standards for certain entity types. Decisions reached in the Oct. 16, 2019 meeting will push back the effective date for lease accounting, credit loss impairment, and derivatives and hedging changes for private companies, not-for-profit organizations, and smaller reporting public companies. The board’s decisions will be formalized with the issuance of a written ballot. It is expected that the FASB will release the written ballot next month.

Topics: FASB, Financial Accounting Standards Board, Lease Standards, CECL

The AICPA’s Auditing Standards Board (ASB) recently released SAS No. 134, Auditor Reporting and Amendments, Including Amendments Addressing Disclosures in the Audit of Financial Statements, which updates the form and content of a financial statement auditor’s report. Although fairly simple, the changes may make it easier for financial statement users to understand the results of the audit, as well as the auditor’s and management’s responsibilities. 

Topics: accounting, Paul Languirand, audit, FASB, Financial Accounting Standards Board, Auditing Standards

As you wrap up your 2018 financial reporting and move into 2019, you may want to take stock of the changes that will come into effect in 2019. For public companies, the long awaited changes to revenue recognition are being applied. Private companies have several small modifications that may make their reporting a little easier.

Topics: private company, FASB, public company, Financial Accounting Standards Board, Peter Gold, Financial Statement

Cloud-based software has grown in prevalence, and many companies find it an effective way to reduce upfront capital investment in software and outsource the upkeep of those systems. As technology has advanced, systems available on the cloud have increased in their size and complexity. These more complex systems have begun to require significant implementation costs in their own right to configure and integrate.

Topics: accounting, goodwill, Paul Languirand, FASB, Financial Accounting Standards Board, Testing for Goodwill, Cloud-Based Software

As the effective date of the new revenue standard draws nearer and implementation becomes imminent for non-public entities within its scope, management should be aware of some important areas that their auditors will be focusing on in the upcoming months.

Topics: private companies, private company, FASB, Revenue recognition, David Lewin, Financial Accounting Standards Board, ASC Topic 606, Revenue from Contracts with Customers

Recently, the Financial Accounting Standards Board (FASB) released guidance clarifying the definition of a business. Accounting standards update (ASU) 2017-01, Business Combinations (Topic 805) Clarifying the Definition (ASU 2017-01) seeks to narrow the circumstances where a set of assets and activities qualifies as a business. The changes are anticipated to result in more transactions being accounted for as asset acquisitions instead of business combinations.

Topics: FASB, Financial Accounting Standards Board, definition of a business, Peter Gold

The Financial Accounting Standards Board (FASB)'s revised definition of readily determinable fair value (RDFV) may have in fact made the net asset value practical expedient more difficult to apply. In 2015, the FASB issued accounting updates addressing investments that calculate net asset value (NAV) per share, which, among other amendments, amended the definition of RDFV. Feedback received from financial statement preparers and users indicate that the intended clarification may have resulted in additional confusion rather than clarity regarding when a financial instrument is considered to have a RDFV. As a result, employee benefit plan advisors, financial statement preparers, and investors in entities with the impacted financial instruments may want to take a closer look at the issue, which could have an effect on their accounting for alternative investments.

Topics: Paul Languirand, FASB, Fair Value, Financial Accounting Standards Board, Accounting Issues, net asset value, NAV

The Financial Accounting Standards Board (FASB) released Accounting Standards Update (ASU) 2016-09, Compensation (Topic 718): Improvements to Employee Share-Based Accounting in March 2016. The ASU, which is a result, in part, of the post-implementation review of FASB Statement No. 123(R) Share Based Payment, is also part of the FASB's continuing simplification project.

Topics: accounting, FASB, Patrick Quinn, Financial Accounting Standards Board, share-based payment accounting

Topics: FASB, Revenue recognition, Financial Accounting Standards Board, Performance obligations, Licensing