Financial Reporting Faces Technological Change
FASB and its Financial Accounting Standards Advisory Council (FASAC) are contemplating the future of financial reporting in a world of rapid technological change. At their meeting on June 15, the board and the members of the advisory panel did not attempt to predict how financial reporting and standards setting will change. However, there was a general agreement among that the manner in which investment firms use technology has changed to such an extent that it is inevitable that financial reporting will also have to change. “There is a tidal wave of change in the investment world,” said FASB member Harold Schroeder, who spent a decade as a fund manager before joining the accounting board in 2010. The companies that prepare financial statements, the auditors that examine the statements, and the standards setters who write the rules are facing a new business environment that includes many types of investors using the financial information.
Exposure Draft to Include Proposed Amendments to Property, Plant, and Equipment Standard
The IASB published proposed amendments to IAS 16, Property, Plant and Equipment, on June 20. The IASB plans to review the amendments in July with the international standards setters on its Accounting Standards Advisory Forum. Work on the planned amendments began two years ago with a request to the IFRS Interpretations Committee (IFRIC) to clarify the accounting for the sale of a fixed asset under construction after deducting the costs for installing or erecting the building or equipment. The IFRIC was asked to determine if the difference between the net proceeds from the sale and whether the costs of testing the asset should be recognized in earnings or deducted from the asset’s cost. Comments on the proposal are due by October 19, 2017.
Nominations Sought for Standing Advisory Group
The PCAOB said that it is seeking nominations for its Standing Advisory Group (SAG) for the 2018–2020 term. The PCAOB said SAG nominees should have expertise in accounting, auditing, corporate finance, corporate governance, or investing in public companies. The board said it also wants nominees who have auditing or financial reporting experience with broker-dealers and smaller public companies. “SAG members provide insight and expertise that informs PCAOB research and standard-setting projects,” PCAOB Chief Auditor Martin Baumann said in a statement. Baumann is also the SAG’s chairman. Any person or organization can submit nominations, and self-nominations are allowed. Nominations are due by August 12.