Regulatory and Standard Setting

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IFIAR Annual Survey of Audit Inspection Findings Poses Challenge to Audit Firm Networks

On 8 March 2018, the International Forum of Independent Audit Regulators (IFIAR) released the report of its 2017 Inspection Findings Survey (Report) as well as the Survey Report Stakeholders Announcement (Announcement). The survey was IFIAR’s sixth annual survey of inspection findings from member regulators’ individual inspections of audit firms affiliated with the six largest global audit firm networks.

 

November 2018

GDPR - The Risk of Comforting Lies and the Need to Acknowledge Technology Best Practices

Even though many organisations think the GDPR momentum is lost, the need to continue to work towards GDPR compliance is still very much there. Not because the Data Protection Authorities will be knocking on many doors in the near future or start to hit with a flood of fines. The key risk is that a situation of insufficient compliance can provoke the use of comforting lies, which can eventually lead to directors liabilities, which D&O liability insurance policies do not necessarily cover.

IASB Amends Definition of ‘Material’

The International Accounting Standards Board (IASB) has issued the amendments, Definition of Material (Amendments to IAS 1 and IAS 8). These amendments include a new definition of ‘material’ and clarify how the definition should be applied by including certain supporting requirements in the definition itself.

FASB Expands US Benchmark Interest Rates for Hedge Accounting

The US Financial Accounting Standards Board (FASB) has issued Accounting Standards Update (ASU) No. 2018-16, Derivatives and Hedging (Topic 815): Inclusion of the Secured Overnight Financing Rate (SOFR) Overnight Index Swap (OIS) Rate as a Benchmark Interest Rate for Hedge Accounting. The amendments made by this ASU expand the list of US benchmark interest rates permitted in the application of hedge accounting.

October 2018

IASB Provides New Definition of ‘Business’ for IFRS 3

On 22 October 2018, the International Accounting Standards Board (IASB) issued narrow-scope amendments to International Financial Reporting Standards (IFRS) 3, Business Combinations. The amendments, Definition of a Business (Amendments to IFRS 3), change the definition of a business to enable businesses to determine whether an acquisition is a business combination or an asset acquisition.

IAASB Revises Standard for Auditing Accounting Estimates

The International Auditing and Assurance Standards Board (IAASB) has revised its International Standard on Auditing (ISA) 540 (Revised), Auditing Accounting Estimates and Related Disclosures.

SEC Proposes Amendments to Codify Exemption to Credit Rating Agency Rule

The US Securities and Exchange Commission (SEC) has proposed amendments to codify an existing temporary exemption for credit rating agencies registered with the SEC as nationally recognised statistical rating organisations (NRSROs).

PCAOB Rolls Out New Research and Standard-Setting Project Pages

The US Public Company Accounting Oversight Board (PCAOB) has developed new web pages with information on its research and standard-setting projects.

September 2018

EFRAG Raises Concerns about IFRS Insurance Standard

The European Financial Reporting Advisory Group (EFRAG) has advised the International Accounting Standards Board (IASB) that EFRAG believes that certain aspects of International Financial Reporting Standard (IFRS) 17, Insurance Contracts, should be considered further.

FASB Improves the Accounting for Costs of Implementing a Cloud Computing Service Arrangement

The US Financial Accounting Standards Board (FASB) has issued Accounting Standards Update (ASU) 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract.

August 2018

IPSASB Issues Proposed Amendments to IPSASs 36 and 41

The International Public Sector Accounting Standards Board (IPSASB) has released Exposure Draft 66, Long-term Interests in Associates and Joint Ventures (Amendments to IPSAS 36), and Prepayment Features with Negative Compensation (Amendments to IPSAS 41). The due date for comments is 22 October 2018.

IAESB Publishes New Education Insights

The International Accounting Education Standards Board (IAESB) has published four new articles in its Accounting Education Insights series. The series provides subject-specific information in support of the IAESB’s strategy and work plan.

FASB Amends Fair Value Disclosure Requirements

The US Financial Accounting Standards Board (FASB) has issued Accounting Standards Update (ASU) No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement.

FASB Amends Disclosure Requirements for Defined Benefit Plans

The US Financial Accounting Standards Board (FASB) has issued Accounting Standards Update (ASU) 2018-14, Compensation - Retirement Benefits - Defined Benefit Plans - General (Subtopic 715-20): Disclosure Framework - Changes to the Disclosure Requirements for Defined Benefit Plans.

FASB Proposes Narrow-Scope Improvements to Credit Loss Standard

The US Financial Accounting Standards Board (FASB) has issued a proposed Accounting Standards Update (ASU), Proposed Accounting Standards Update—Codification Improvements to Topic 326, Financial Instruments—Credit Losses. The proposal would amend the transition requirements and scope ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. Stakeholders are encouraged to review and provide comment on the proposal by 19 September 2018.

SEC Adopts Amendments to Simplify and Update Disclosure Requirements

The US Securities and Exchange Commission (SEC) has adopted amendments to certain disclosure requirements that have become duplicative, overlapping, or outdated, in light of other SEC disclosure requirements, US Generally Accepted Accounting Principles (GAAP), or changes in the information environment. The amendments change disclosure requirements in a number of SEC rules, including Regulations S-X and S-K.

IFRS Foundation Publishes Educational Modules for IFRS for SMEs

The IFRS Foundation has released additional educational modules supporting the IFRS for SMEs, adding to the modules released last spring, for a total of ten. These materials have been designed to provide stakeholders with additional support in preparing and reading financial statements prepared in accordance with the IFRS for SMEs.

IPSASB Issues New Financial Instruments Standard

The International Public Sector Accounting Standards Board (IPSASB) has released International Public Sector Accounting Standards (IPSAS) 41, Financial Instruments.

New FASB Guidance Improves Accounting for Long-Duration Insurance Contracts

The US Financial Accounting Standards Board (FASB) has issued Accounting Standards Update (ASU) 2018-12, Financial Services—Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts

FASB Proposes Narrow-Scope Improvements to Accounting for Lessors

The US Financial Accounting Standards Board (FASB) has issued a proposed accounting standards update (ASU) that would reduce costs and ease implementation of ASU No. 2016-02, Leases (Topic 842) for financial statement preparers. The draft proposal would also clarify a specific requirement in the Leases standard related to lessor accounting. The comment deadline is 12 September 2018.

SEC Staff Publishes Guide on Revised Definition of Smaller Reporting Company

The staff in the Division of Corporation Finance of the US Securities and Exchange Commission (SEC) have published a Small Entity Compliance Guide, Amendments to the Smaller Reporting Company Definition (Compliance Guide). The Compliance Guide summarises and explains the rules recently adopted by the SEC to amend the definition of a ‘Smaller Reporting Company’.

SEC Staff Updates Interpretation of Proxy Rules and Schedules

The staff in the US Securities and Exchange’s (SEC’s) Division of Corporation Finance (Corp Fin) has updated its Compliance and Disclosure Interpretation (C&DI), Proxy Rules and Schedules 14A/14C. This C&DI provides, in a question and answer format, Corp Fin’s interpretations of the proxy rules and Schedules 14A/14C.

IFAC Updates Guidance for Auditing Small Businesses

The International Federations of Accountants (IFAC) has updated its guidance for auditing small businesses, Guide to Using ISAs in the Audits of SMEs, Fourth Edition (Guide). The Guide provides practical support and guidance to small and medium-sized practices when implementing and applying the International Standards on Auditing (ISAs) in audits of small and medium-sized entities (SMEs).

IOSCO Recommends Measures for Managing Extreme Market Volatility

The International Organization of Securities Commissions (IOSCO) has published eight recommendations to assist trading venues and regulatory authorities in the implementation of mechanisms to manage extreme volatility and preserve orderly trading. The recommendations are included in the report, Mechanisms Used by Trading Venues to Manage Extreme Volatility and Preserve Orderly Trading (Report).

FASB Solicits Public Company Participation in Segment Reporting Project

The US Financial Accounting Standards Board (FASB) has announced that it is seeking public companies to participate in a study on potential improvements to the segment aggregation guidance and the reportable segments process. This study is the first phase of outreach to preparers as part of a FASB technical agenda project to improve reporting under FASB Accounting Standards Codification™ Topic 280, Segment Reporting.

IFRS Foundation Appoints New Chair

The former Governor of the Finnish Central Bank, Erkki Liikanen, has been appointed as the Chair of the IFRS Foundation Trustees. He succeeds Michel Prada, who has served as Chair since 2011. Mr. Liikanen brings significant international economic and policy leadership experience to the IFRS Foundation. His initial term is for three years, beginning after the Trustees’ meeting in Johannesburg, South Africa, in October 2018.

FASB Issues Codification Improvements to Topic 842, Leases

The US Financial Accounting Standards Board (FASB) has issued Accounting Standards Update (ASU) No. 2018-10, Codification Improvements to Topic 842, Leases

FASB Issues Targeted Improvements to Lease Standard

The US Financial Accounting Standards Board (FASB) has issued Accounting Standards Update (ASU) No. 2018-11, Leases (Topic 842): Targeted Improvements. ASU 2018-11 is intended to reduce costs and ease implementation of the Topic 842, the new leases standard, for financial statement preparers.

IFAC and IAESB to Overhaul Accountancy Training and Professional Development

The International Federation of Accountants (IFAC) and the International Accounting Education Standards Board (IAESB) have announced a plan to restructure the operations and oversight of the international accountancy education, training and development now managed by IAESB. Under the planned new model, oversight will be provided by the IFAC board, instead of by the Public Interest Oversight Board (PIOB), which currently provides oversight. The new model is expected to be operational by 1 July 2019.

ICAEW Report Discusses Audit Scepticism

The Institute of Chartered Accountants in England and Wales (ICAEW) has published the thought leadership report, Scepticism: The Practitioners' Take, discussing the role of professional scepticism in the work of auditors. The report, based on interviews with auditors and regulators on the topic of scepticism, notes that despite the centrality of scepticism to the work of auditors, regulators continue to express concerns that auditors are not sufficiently sceptical.

FASB Issues Codification Improvements

The US Financial Accounting Standards Board (FASB) has released Accounting Standards Update (ASU) No. 2018-09, Codification Improvements. ASU 2018-09 amends a wide variety of improvements to provisions in the FASB Accounting Standards Codification

FASB Issues ASU on Share-Based Compensation to Non-Employees

The US Financial Accounting Standards Board (FASB) has issued Accounting Standards Update (ASU) 2018-07, Compensation —Stock Compensation (Topic 718) —Improvements to Nonemployee Share-Based Payment Accounting. ASU 2018-07 expands the scope of FASB Accounting Standards Codification™ Topic 718, Compensation—Stock Compensation, to include share-based compensation to nonemployees for goods or services.

FASB Issues ASU on Contributions of Cash and Other Assets to NFPs

The US Financial Accounting Standards Board (FASB) has issued Accounting Standards Update (ASU) No. 2018-08, Not-for-Profit Entities (Topic 958): Clarifying the Scope and the Accounting Guidance for Contributions Received and Contributions Made. ASU 2018-08 clarifies and improves the scope and accounting guidance for contributions of cash and other assets received and made by not-for-profit organisations (NFPs) and business enterprises.

July 2018

IFAC Updates Guidance for Auditing Small Businesses

The International Federations of Accountants (IFAC) has updated its guidance for auditing small businesses, Guide to Using ISAs in the Audits of SMEs, Fourth Edition (Guide). The Guide provides practical support and guidance to small and medium-sized practices when implementing and applying the International Standards on Auditing (ISAs) in audits of small and medium-sized entities (SMEs).

IESBA Publishes Enhancements to Inducements Standard

The International Ethics Standards Board for Accountants (IESBA) has published enhancements to its International Code of Ethics for Professional Accountants (including International Independence Standards) (Ethics Code). These amendments, Revisions to the Code Pertaining to the Offering and Accepting of Inducements (Inducements Revisions), provide a comprehensive framework that more clearly delineates the boundaries of acceptable inducements than the exiting provisions.

IASB Publishes Educational Materials on Application of IFRS 17 for Mutual Entities

The International Accounting Standards Board (IASB) issued International Financial Reporting Standards (IFRS) 17, Insurance Contracts in May 2017. IFRS 17 will replace the previous guidance in IFRS 4, Insurance Contracts. IFRS 17, in contrast to IFRS 4, is a comprehensive standard for insurance contracts. IFRS 4 was issued as an interim standard that permitted companies to continue their accounting practices for insurance contracts and focused on enhancing disclosures on the amount, timing and uncertainty of future cash flows from insurance contracts.

IFRS Foundation Proposes Changes to Constitution

The Trustees of the IFRS Foundation have issued the Exposure Draft, Amending the Terms of Appointment for the IFRS Foundation Trustee Chair and Vice-Chairs. The Exposure Draft proposes narrow-scope amendments to the Constitution of the IFRS Foundation to increase the maximum tenure of the Trustee Chair and Vice-Chairs. Comments on the proposal are due by 17 September 2018.

April 2018

IFRS Foundation Publishes New Supporting Materials for the IFRS for SMEs

The IFRS Foundation has released the first three of 35 planned stand-alone training modules for the International Financial Reporting Standard for Small and Medium-Sized Entities (IFRS for SMEs). Each module covers one of the 35 sections in the IFRS for SMEs, as amended in 2015

FASB Issues Proposal on Collaborative Arrangements

The US Financial Accounting Standards Board (FASB) has released proposed Accounting Standard Update (ASU), Collaborative Arrangements (Topic 808): Targeted Improvements. Comments on this proposal are due by 11 June 2018.

SEC Staff Updates XBRL FAQs

The US Securities and Exchange Commission (SEC) staff has updated its FAQs on the IFRS Taxonomy to provide additional contact clarification and information for questions on structuring disclosures using the IFRS Taxonomy.

IESBA Releases New Code of Ethics

The International Ethics Standards Board for Accountants (IESBA) has published its new and renamed International Code of Ethics for Professional Accountants (including International Independence Standards) (Ethics Code). The new Ethics Code has been completely restructured for ease in navigation, use, and enforcement. It becomes effective in June 2019, with early adoption permitted.

ESMA Reports on 2017 Enforcement and Regulatory Activities

The European Securities and Markets Authority (ESMA) has published the report, Enforcement and Regulatory Activities of Accounting Enforcers in 2017 (Report). The Report provides an overview of the activities of the European Securities and Markets Authority (ESMA) and the accounting enforcers in the European Economic Area (EEA or European enforcers) in examining compliance with International Financial Reporting Standards (IFRS) of 2017 financial information provided by issuers.

ESMA Proposes Prospectus Simplification

The European Securities and Markets Authority (ESMA) has published the first part of Technical Advice under the Prospectus Regulation (Technical Advice). The Technical Advice is part of a project to simplify both the format and content of a prospectus.

SEC Staff Guidance on Non-GAAP Measures Updated

The staff in the Division of Corporation Finance of the US Securities and Exchange (SEC) has updated its Compliance and Disclosure Interpretation (C&DI), Non-GAAP Financial Measures. This C&DI provides staff interpretations of the rules and regulations on the use of non-GAAP financial measures.

IASB Releases Revised Conceptual Framework

The International Accounting Standards Board (IASB) has issued its revised Conceptual Framework for Financial Reporting (Conceptual Framework). The Conceptual Framework sets out the objectives with respect to and the fundamental concepts of financial reporting.

March 2018

GAO Issues Report on SEC Actions to Clarify Disclosures on Climate-Related Risks

On 22 March 2018, the US Government Accountability Office (GAO) issued its report, Climate-Related Risks: SEC Has Taken Steps to Clarify Disclosure Requirements (Report). The Report follows up on a US Securities and Exchange (SEC) report issued in 2010, Commission Guidance Regarding Disclosure Related to Climate Change in 2010 (2010 Guidance).

European Commission Consults on Fitness Check on European Union for Public Reporting

The European Commission (EC) has published the consultation document, Fitness Check on the EU Framework for Public Reporting by Companies (Fitness Check). The Fitness Check seeks public comment on whether the European Union’s (EU’s) framework for public reporting by companies is fit for its stated purpose. Comments are due by 21 July 2018.

IASB Proposes Amendments to IAS 8 on Accounting Policy Changes 

The International Accounting Standards Board (IASB) has released the exposure draft, Accounting Policy Changes(Proposed Amendments to IAS 8) (Exposure Draft). The Exposure Draft proposes narrow-scope amendments to International Accounting Standards (IAS) 8, Accounting Policies, Changes in Accounting Estimates and Errors. The comment deadline is 27 July 2018.

IOSCO Reports on Helping Senior Investors Avoid Investment Fraud and Risks

The International Organization of Securities Commissions (IOSCO) has published the report, Senior Investment Vulnerability (Report), examining growing concerns regulators have about the risks to ageing investors to financial fraud and other risks and identifies sound practices for enhancing their protection.

European Supervisory Authorities Report on Big Data

The Joint Committee of the European Supervisory Authorities (ESAs) published the report, Joint Committee Final Report on Big Data (Report) and the companion fact sheet, Use of Big Data by financial institutions (Fact Sheet). The Report analyses the effect of Big Data on consumers and financial firms. The ESAs (European Banking Authority (EBA), the European Securities and Markets Authority (ESMA) and the European Insurance and Occupational Pensions Authority (EIOPA)) based their Report from the results of a consultation conducted between December 2016 and March 2017.

FASB Updates Codification SEC Guidance 

The US Financial Accounting Standards Board (FASB) has issued Accounting Standards Update (ASU) No. 2018-04, Investments—Debt Securities (Topic 320 and Regulated Operations (Topic 980): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 117 and SEC Release No. 33-9273.

February 2018

FASB Proposes Additional Benchmark Interest Rate for Hedge Accounting  

The US Financial Accounting Standards Board (FASB) has issued a proposed Accounting Standards Update (ASU) to add a fifth option to the list of US benchmark interest rates permitted in the application of hedge accounting under FASB Accounting Standards Codification™ Topic 815, Derivatives and Hedging. The comment due date is 30 March 2018.

IOSCO Consults on Conflicts of Interest in Raising Equity Capital 

The International Organization of Securities Commissions (IOSCO) has issued the Consultation Report, Conflicts of Interest and Associated Conduct Risks During the Equity Capital Raising Process. With this Consultation Report, IOSCO is proposing guidance to address these potential conflicts of interest and misconduct risks. The comment due date is 4 April 2018.

IOSCO Consults on Protective Measures for Investors in OTC Leveraged Products 

The International Organization of Securities Commissions (IOSCO) has issued the consultation report, Report on Retail OTC Leveraged Products (Consultation Report). The Consultation Report proposes policy measures for its member organisations to consider when addressing the risks arising from the offer and sale of certain over-the-counter (OTC) leveraged products to retail clients. The comment due date is 27 March 2018.

IASB Amends IAS 19 on Measuring Pension Expense on Plan Changes

The International Accounting Standards Board (IASB) has issued Plan Amendment, Curtailment or Settlement (Amendments to IAS 19). These amendments are narrow in scope and specify how companies must determine pension expenses upon changes to a defined benefit pension plan.

January 2018

IPSASB Proposes Public Sector Lease Accounting Model 

The International Public Sector Accounting Standards Board® (IPSASB®) has released its Exposure Draft (ED) 64, Leases. The comment deadline is 30 June 2018.

FASB Simplifies Adoption of New Leases Standard for Certain Land Easements 

The US Financial Accounting Standards Board (FASB) has issued Accounting Standards Update (ASU) No. 2018-01, Leases (Topic 842):Land Easement Practical Expedient for Transition to Topic 842. The purpose of the ASU is to clarify the application of the FASB Accounting Standards Codification™ Topic 842, Leases, the new leases guidance, to land easements. It also eases adoption efforts for some land easements.

ESMA Publishes Guidance on IFRS Accounting for Effects of New US Tax 

The European Securities and Markets Authority (ESMA) has released the public statement, Accounting for Income Tax consequences of the United States Tax Cuts and Jobs Act under IFRS (Public Statement).

FASB Issues Proposed Guidance on the Tax Cuts and Jobs Act 

The US Financial Accounting Standards Board (FASB) has issued a proposed Accounting Standards Update (ASU) that is intended to help organisations reclassify certain stranded income tax effects in accumulated other comprehensive income resulting from the Tax Cuts and Jobs Act of 2017 (the Act). Comments on the proposed ASU are due by 2 February 2018.

IOSCO Raises Concerns about Cryptocurrency Offerings

The International Organization of Securities Commissions (IOSCO) has issued a communiqué discussing potential issues related to initial coin offerings (ICOs). IOSCO met in October 2017 and discussed the growing usage of ICOs. IOSCO then issued a statement to its members and noted the various approaches to ICOs taken by members.

IFAC Releases Publication on Agreed-Upon Procedures Engagements 

The International Accounting and Assurance Standards Board (IAASB) is currently working on a standard setting project proposal to revise the International Standard on Related Services (ISRS) 4400, Engagements to Perform Agreed-Upon Procedures Regarding Financial Information, following the issuance of a Discussion Paper and review of feedback on the Discussion Paper. ISRS 4400 in its current form will be effective until adoption of a revised standard. 

IASB Issues IFRS Taxonomy Update for IFRS 17 

The International Accounting Standards Board (IASB) has updated the IFRS Taxonomy 2017 for changes to International Financial Reporting Standards (IFRS) resulting from IFRS 17, Insurance Contracts, adopted by the IASB in May 2017.

December 2017

SEC Staff Issues Guidance for Accounting Impact of US Tax Law Changes   

Staff of the US Securities and Exchange Commission (SEC) have published guidance relating to the accounting effects of the recently passed amendments to the US tax law under the Tax Cuts and Jobs Act (Tax Act).

SEC Appoints New PCAOB Chairman and Board Members   

The US Securities and Exchange Commission (SEC) has appointed a new Chairman and members to the Public Company Accounting Oversight Board (PCAOB) to replace the existing PCAOB.

IASB Publishes Q&A Guidance for IFRS for SMEs

The IFRS Foundation has published new guidance on International Financial Reporting Standard for Small and Medium-sized Entities (IFRS for SMEs). The new guidance, IFRS for SMEs® Standard, Section 12, Issue 1, Accounting for Financial Guarantee Contracts in Individual or Separate Financial Statements of Issuer, was developed by the SME Implementation Group (SMEIG). This is the first IFRS for SMEs guidance published since completion of the revised IFRS for SMEs in May 2015.

IASB Issues Annual Improvements

The International Accounting Standards Board (IASB) has issued amendments to several International Financial Reporting Standards (IFRS), Annual Improvements to IFRS Standards 2015–2017 Cycle (2017 Annual Improvements).

FASB Eliminates U.S. Steamship Entities Codification Topic  

The US Financial Accounting Standards Board (FASB) has issued Accounting Standards Update (ASU) No. 2017-15, Codification Improvements to Topic 995, U.S. Steamship Entities: Elimination of Topic 995. This ASU eliminates Topic 995, U.S. Steamship Entities, from the FASB Codification.

IFRS Foundation Proposes Update to IFRS Taxonomy 2017 for Annual Improvements 

The IFRS Foundation has published proposed Updates to the IFRS Taxonomy 2017 (Proposed Update) for changes to International Financial Reporting Standards (IFRS) resulting from annual improvements to IFRS by the International Accounting Standards Board (IASB). The comment deadline for the Proposed Update is 29 January 2018.

IAASB to Collaborate with World Sustainability Organisation

The International Auditing and Assurance Standards Board (IAASB) has entered into a collaboration with the World Business Council for Sustainable Development (WBCSD) to strengthen international assurance standards on sustainability reporting.

November 2017

College of Knowledge

Baker Tilly Berk is pleased to announce that the videos of the five top keynote speakers from the Baker Tilly International World Conference are now available online.

October 2017

IASB Amends IFRS 9 and IAS 28

The International Accounting Standards Board (IASB) has issued amendments to International Financial Reporting Standards (IFRS): Prepayment Features with Negative Compensation - Amendments to IFRS 9; and Long-term Interests in Associates and Joint Ventures - Amendments to IAS 28. These documents amend IFRS 9, Financial Instruments, and International Accounting Standards (IAS) 28, Investments in Associates and Joint Ventures, respectively.

SEC Adopts Interpretive Guidance on Pay Ratio Rule

The US Securities and Exchange Commission (SEC) has approved interpretive guidance for use by companies in complying with the pay ratio disclosure requirement mandated by Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The SEC pay ratio disclosure rule requires companies to begin making pay ratio disclosures in early 2018.

Case Study Report: Better Communication - Making Disclosures More Meaningful

The International Financial Reporting Standards (IFRS) Foundation has published a case study report showing how companies from different parts of the world have improved communication in their IFRS financial statements.

FASB Amends SEC Paragraphs related to Revenue Recognition and Leases Standards for Public Business Entities

The US Financial Accounting Standards Board (FASB) has issued Accounting Standards Update (ASU) No. 2017-13. This ASU adds, amends, and supersedes SEC paragraphs of the FASB Accounting Standards Codification (ASC) related to the adoption and transition provisions of ASU No. 2014-09, Revenue From Contracts with Customers, and ASU 2016-02, Leases, for public business entities.

September 2017

Ethics Board Proposes Revisions to the Code of Ethics 

The International Ethics Standards Board for Accountants has proposed revisions to the Code of Ethics for Professional Accountants that would establish a comprehensive framework to deal with all forms of inducements. The comment period ends on 8 December 2017.

FASB Proposes Improvements to Grant Accounting

The US Financial Accounting Standards Board (FASB) has issued proposed Accounting Standard Update (ASU), Not-for-profit Entities (Topic 958): Clarifying the Scope and the Accounting Guidance for Contributions Received and Contributions Made. Although the proposed guidance would apply primarily to not-for-profit entities, it would also apply to business enterprises and all other organisations that receive or make contributions of cash and other assets. The comment deadline is 1 November 2017.

IFAC Issues Guidance on Navigating Accountancy Regulations

The International Federation of Accountants (IFAC) has released new guidance to support professional accountancy organisations (PAOs) in navigating their national regulatory environments. 

IPSASB Proposes Improvements to Financial Instruments Reporting 

The International Public Sector Accounting Standards Board (IPSASB) has proposed amendments to International Public Sector Accounting Standards (IPSAS) to conform to the financial instruments accounting standard developed by the International Accounting Standards Board (IASB), International Financial Reporting Standard (IFRS) 9, Financial Instruments. The comment due date is 31 December 2017.


July 2017 

ESMA Proposes Simplification of Prospectus Regulation 

The European Securities and Markets Authority (ESMA) has published three Consultation Papers proposing simplification of the Prospectus Regulation. Each Consultation Paper includes proposals for different aspects of the Prospectus Regulatio

FASB Proposes Eliminating Certain Guidance for Savings and Loans Bad Debt Reserves 

The US Financial Accounting Standards Board (FASB) has issued proposed Accounting Standards Update (ASU), Technical Corrections and Improvements to Topic 942, Financial Services —Depository and Lending: Elimination of Certain Guidance for Bad Debt Reserves of Savings and Loans.

Corp Fin Expands Voluntary Draft Registration Statement Review Submissions

The US Securities and Exchange Commission (SEC) has announced that the Division of Corporation Finance (Corp Fin) will permit all companies to submit draft registration statements relating to initial public offerings (IPOs) for review on a non-public basis. This process will be available for IPOs as well as most offerings made in the first year after a company has entered the public reporting system. The effective date is 10 July 2017.

FASB Proposes Guidance on Variable Interest Entities

In response to recommendations of the Private Company Council (PCC), the US Financial Accounting Standards Board (FASB) has issued the proposed Accounting Standard Update (ASU), Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities.

IASB Proposes Amendments to IAS 16 

The International Accounting Standards Board (IASB) has proposed narrow scope amendments to IAS 16, Property, Plant and Equipment. Comments are due by 19 October 2017.

 

June 2017

SEC Staff Issues FAQs on the IFRS Taxonomy and Inline XBRL

The staff of the US Securities and Exchange Commission (SEC) has published frequently asked questions (FAQs) on the IFRS Taxonomy. This document provides guidance to Foreign Private Issuers preparing their financial statements in accordance with International Financial Reporting Standards (IFRS) and using the IFRS Taxonomy to submit XBRL filings.

IFRS Foundation Publishes Annual Report 

The International Financial Reporting Standards (IFRS) Foundation has published its Annual Report 2016, Better Communication in Financial Reporting (2016 Annual Report), for the year ended 31 December 2016. 

IAASB Proposes New Standard to Modernise Auditing of Accounting Estimates 

The International Auditing and Assurance Standards Board (IAASB) has issued the exposure draft, Proposed International Standard on Auditing 540 (Revised), Auditing Accounting Estimates and Related Disclosures. The comment deadline is 1 August 2017. 

IASB Proposes Narrow-scope Amendments to IFRS 9

The International Accounting Standards Board (IASB) has issued the exposure draft, Prepayment Features with Negative Compensation (Proposed amendments to IFRS 9) (Exposure Draft). The Exposure Draft proposes minor, narrow-scope amendments to International Financial Reporting Standard (IFRS) 9, Financial Instruments, which address concerns expressed by stakeholders relating to how prepayable financial assets should be classified under IFRS 9.

IESBA Proposes Guidance on Scepticism and Judgement

The International Ethics Standards Board for Accountants (IESBA) has published the Exposure Draft, Proposed Application Material Relating to Professional Skepticism and Professional Judgment. The comment period ends 25 July 2017.

FASB Issues ASU on Determining the Customer in Service Concession Arrangements

The US Financial Accounting Standards Board (FASB) has issued Accounting Standards Update (ASU) 2017-10, Service Concession Arrangements (Topic 853): Determining the Customer of the Operation Services. 

ESMA Consults on Money Market Funds Rules 

The European Securities and Markets Authority (ESMA) has issued the Consultation Paper, Draft technical advice, implementing technical standards and guidelines under the MMF Regulation, proposing technical advice and guidelines on the Money Market Funds Regulation (MMFR), in addition to draft implementing technical standards. Comments on the Consultation Paper are due by 7 August 2017. 

IASB Issues Final Contracts Guidance

The International Accounting Standards Board (IASB) has issued International Financial Reporting Standard (IFRS) 17, Insurance Contracts, described by the IASB as a ‘fundamental overhaul of insurance accounting’. IFRS 17 replaces IFRS 4, Insurance Contracts, and in contrast to IFRS 4, IFRS 17 provides comprehensive guidance on accounting for insurance contracts. 

PCAOB Adopts New Standard to Enhance Auditor's Report

The US Public Company Accounting Oversight Board (PCAOB) has adopted a new auditing standard, The Auditor’s Report on an Audit of Financial Statements When the Auditor Expresses an Unqualified Opinion. The new standard requires the auditor's report to include additional important information to investors and is subject to approval by the US Securities and Exchange Commission (SEC).

FASB Improves the Accounting for Modification of Shared-Based Payment Awards

The US Financial Accounting Standards Board (FASB) has issued Accounting Standards Update (ASU) No. 2017-09, Compensation—Stock Compensation (Topic 718) — Scope of Modification Accounting. ASU 2017-09 applies to entities that change the terms or conditions of a share-based payment award.

April 2017

FASB Improves the Presentation of Net Periodic Pension Cost and Net Periodic Post-retirement Benefit Cost

The US Financial Accounting Standards Board (FASB) has issued Accounting Standards Update (ASU) No. 2017-07, Compensation — Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. The amendments apply to all employers, including not-for-profit entities, that offer their employees defined benefit pension plans, other post-retirement benefit plans, or other types of benefits accounted for under Topic 715, Compensation — Retirement Benefits.

FASB Issues Proposal to Simplify Accounting for Non-employee Share-Based Payments

The US Financial Accounting Standards Board (FASB) has proposed an amendment to the FASB Accounting Standards Codification to simplify accounting for share-based compensation paid to non-employees. The Proposed Accounting Standards Update (ASU), Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting, is intended to reduce cost and complexity and to improve financial reporting for non-employee share-based payments. Comments are due by 5 June 2017.

EU Parliament Approves Shareholder ‘Say on Pay’ for EU Companies

The European Parliament (EU Parliament) has approved amendments to the Shareholders' Rights Directive that would provide shareholders with stronger rights and require improved disclosure by companies and institutional investors. The new rules will apply to listed companies on European Union (EU) regulated markets, regardless of their industrial sector. The total capitalisation of the affected companies is approximately €8tn.

IASB Publishes Discussion Paper on More Effective Financial Statement Disclosures

The International Accounting Standards Board (IASB) on 30 March 2017 published the Discussion Paper, Disclosure Initiative—Principles of Disclosure (Discussion Paper), proposing recommendations to improve communication in financial reporting through improved disclosures. The comment deadline is 2 October 2017. 

FASB Issues ASU on Premium Amortisation

On 30 March 2017, the US Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2017-08, Receivables—Nonrefundable Fees and Other Costs (Subtopic 310-20), Premium Amortization on Purchased Callable Debt Securities. The ASU shortens the amortisation period for certain callable debt securities held at a premium to the earliest call date. 

European Commission Launches Consultation on Operation of Supervisory Authorities

The European Commission (Commission) has launched a public consultation on the operation of the European Supervisory Authorities (ESAs), including the European Securities and Markets Authority (ESMA), the European Banking Authority (EBA), and the European Insurance and Occupational Pensions Authority (EIOPA). The comment deadline is 16 May 2017. 

ESMA Reports on Market and Valuation Risks

The European Securities and Markets Authority (ESMA) has issued the report, ESMA Report on Trends, Risks and Vulnerabilities No. 1, 2017 (Report), which identifies and discusses the main securities market risk drivers for 2017. The Report concludes that the main risk drivers were political and policy uncertainty, including potential repercussions from the upcoming elections in some European Union (EU) Member States.  

March 2017

FASB Issues Not-for-Profit Consolidation Guidance

The US Financial Accounting Standards Board has issued Accounting Standards Update No. 2017-02, Not-for-Profit Entities - Consolidation (Subtopic 958-810): Clarifying When a Not-for-Profit Entity That Is a General Partner or a Limited Partner Should Consolidate a For-Profit Limited Partnership or Similar Entity.

FASB Issues Proposed Changes on Balance Sheet Debt Classification and Disclosure Requirements for Inventory

The US Financial Accounting Standards Board has issued the following proposed Accounting Standards Updates: Debt (Topic 470): Simplifying the Classification of Debt in a Classified Balance Sheet (Current versus Noncurrent) and Inventory (Topic 330): Disclosure Framework - Changes to the Disclosure Requirements for Inventory.

IESBA Completes First Phase of Ethics Code Restructuring

The International Ethics Standards Board for Accountants has announced completion of the first phase of its project to restructure its Code of Ethics for Professional Accountants and has released exposure drafts of proposals to strengthen ethics requirements for accountants.

EU Court of Auditors Calls for European Commission to Simplify Further EU Financial Regulation

The European Court of Auditors has issued an opinion calling for the European Commission to further simplify its proposal to revise the European Union Financial Regulation.

PCAOB Publishes Updated Staff Guidance for Form AP

The US Public Company Accounting Oversight Board has issued updated staff guidance for Form AP, Auditor Reporting of Certain Audit Participants, to be used by firms to disclose the names of engagement partners and other firms participating in public company audits.

FASB Simplifies the Goodwill Impairment Test

The US Financial Accounting Standards Board has issued Accounting Standards Update No. 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment.

IPSASB Issues Standard on Public Sector Combinations

The International Public Sector Accounting Standards Board has issued International Public Sector Accounting Standard 40, Public Sector Combinations, which establishes international requirements for public sectors in accounting for combinations of entities and operations.

ESMA Launches Q&A Tool

The European Securities and Markets Authority has developed a tool for use by stakeholders to access the Questions and Answers developed by ESMA.

IOSCO Publishes Analysis of Potential of Tech-Driven Change in Securities Market Industry

The International Organization of Securities Commissions has published the report, IOSCO Research Report on Financial Technology, which highlights the intersection between financial technology and securities market regulation.

IESBA Releases Q&As on Responding to Non-Compliance with Laws and Regulations

The staff of the International Ethics Standards Board for Accountants (IESBA) have published two Question and Answer publications to support the adoption and implementation of the IESBA standard, Responding to Non-Compliance with Laws and Regulations.

FASB Clarifies the Derecognition of Nonfinancial Assets Guidance

The US Financial Accounting Standards Board has issued Accounting Standards Update No. 2017-05, Other Income – Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets.

IAASB Publishes Work Plan for 2017-2018

The International Auditing and Assurance Standards Board has published its Work Plan for 2017–2018: Enhancing Audit Quality.

FASB Changes Master Trust Investments Disclosures for Benefits Plans

The US Financial Accounting Standards Board has issued Accounting Standards Update No. 2017-06, Plan Accounting: Defined Benefit Pension Plans (Topic 960); Defined Contribution Pension Plans (Topic 962); Health and Welfare Benefit Plans (Topic 965): Employee Benefit Plan Master Trust Reporting.

IFIAR Publishes 2016 Annual Inspection Findings

On 3 March 2017, the International Forum of Independent Audit Regulators published its Report on 2016 Survey of Inspection Findings, its fifth annual survey of IFIAR members’ findings from inspected audit reports, as well as the 2016 Annual Inspection Survey Stakeholder Announcement.

Apple Challenges EC’s Use of Arm’s Length in State Aid Case

Apple released its grounds for appealing the €13 billion (US$14 billion) tax bill from the European Commission earlier this week, arguing that the Commission’s arm’s-length test did not comply with EU laws for determining state aid in tax assessments.

January 2017

IFRS Foundation Amends IFRS Constitution

The Trustees of the IFRS Foundation have amended the IFRS Foundation Constitution to implement changes based on their 2015 Review of Structure and Effectiveness (2015 Review).

European Commission Proposes New Rules for the Recovery and Resolution of Central Counterparties

The European Commission has proposed a framework for the European Union of new rules for central counterparty recovery and resolution, the purpose of which is to ensure that failure of central counterparty can be dealt with effectively to avoid overall risk to the system.

IPSASB Staff Publishes Background Paper on Emissions Trading Schemes

The staff of the International Public Sector Accounting Standards Board have developed Emissions Trading Schemes Staff Background Paper.

SEC Chair White Calls for SEC to Continue Pursuit of High-Quality, Globally Accepted Accounting Standards

Mary Jo White, outgoing Chair of the US Securities and Exchange Commission (SEC), issued a public statement urging the SEC to continue to pursue high-quality, globally accepted accounting standards.

EFRAG Endorses IFRS 4 Amendments for Use in EU

The European Financial Reporting Advisory Group has formally endorsed the International Accounting Standards Board amendments to IFRS 4, Insurance Contracts, issued in September 2016, for use across European Union member states.

IASB Issues Exposure Draft on Annual Improvements to IFRS

The International Accounting Standards Board has issued its exposure draft, Annual Improvements to IFRS Standards 2015-2017 Cycle, proposing amendments to three standards as part of its annual improvements process.

FASB Clarifies the Definition of a Business

The US Financial Accounting Standards Board (FASB) has issued Accounting Standards Update (ASU) 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business.