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IRS seeks recommendations for 2018-2019 Guidance Priority List.
The IRS is requesting recommendations for items that should be included on its 2018–2019 Guidance Priority List, which will establish the guidance the IRS intends to issue from July 1, 2018, through June 30, 2019. The IRS stated that it recognizes the importance of public input to formulate a Guidance Priority List that focuses on the items that are most important to taxpayers and tax administrators. The deadline to submit recommendations for the initial list is June 15, 2018.
Final version of disclosure framework amendments slated for mid-year.
In the coming months, FASB plans to publish the guide it first proposed four years ago to help it write consistent, effective footnote disclosure requirements for its standards. By a 5–2 vote, the board agreed to publish its Disclosure Framework, which it plans to use as a reference guide when it debates which disclosures businesses and organizations must make. Board members hope the Disclosure Framework helps them find the correct mix of guidance for footnote disclosures and information that is reported on the face of the financial statements. “I do believe the framework is a very good starting point and will help both this board and future boards come to a consistent philosophy on how to improve disclosures for financial reporting,” FASB Chairman Russell Golden said.
Update erases outdated regulatory guidance from financial services standard.
On May 7, FASB published an update to U.S. GAAP that erases a reference in its financial services standard to a 1985 Office of the Comptroller circular that has since been rescinded. The amendment is effective immediately, FASB said. The final amendment comes from a proposal released in June 2017 as proposed Accounting Standard Update (ASU) 2017-260, Technical Corrections and Improvements to Topic 942: Financial Services—Depository and Lending—Elimination of Certain Guidance for Bad Debt Reserves of Savings and Loans. The update is part of FASB’s regular effort to comb through the Accounting Standards Codification to eliminate errors and make improvements.
Proposed guidance for management performance measure moves forward.
The IASB wants businesses to identify an earnings measurement that presents management’s view of the company’s financial performance for analysts and investors. The board’s decision was part of its effort to develop proposed disclosure guidance for a management-defined measurement of operating performance. If a company were to provide a management-defined measurement, such as recurring profit, it would have to reconcile it in the financial statement footnotes to the most appropriate measurement from IFRS. “We’re saying, ‘Tell us what it is you consider to be the key metric that you use when you explain performance,’” IASB Vice Chair Sue Lloyd said. “We hope plenty of people say that’s an IFRS number … but if it’s not, there’s additional requirements to help explain it.” Board members agreed to proceed with the plan as long as the wording in an upcoming proposal properly communicated that companies would not be required to report the management-defined measurement, and that the proposal communicated that companies should strive to produce financial statements with standardized measurements from IFRS.
State, local governments to disclose more details about debt.
The GASB has issued new rules that require state and local governments to provide more information about the terms of loans and other debt they use to finance public works projects. The updated rules are a response to concerns from bond market regulators and credit rating agencies that governments are increasingly using bank loans and other forms of direct borrowing to pay for projects instead of issuing municipal bonds, but they are offering inconsistent or insufficient information about the terms of these debts. The updated standard calls for state and local governments to disclose more information about the amounts of their lines of credit they have not yet used, the collateral pledged to secure debt, and the specific terms in debt agreements. State and local government borrowers also will have to provide information about the terms in debt agreements that would impose a penalty on borrowers who default, such as an acceleration of a loan’s maturity. Governments must comply with the new accounting rules for reporting periods beginning after June 15; earlier application is encouraged.
Standing Advisory Group to hold first meeting with new leadership.
The PCAOB’s Standing Advisory Group (SAG) was scheduled to have its first meeting with its new board members on June 5–6 in Washington. The meeting was scheduled to take place as PCAOB Chairman William Duhnke evaluates the board’s standards setting activities, inspections of public accounting firms, and regulatory priorities. The PCAOB has gone through a complete overhaul of its membership since the beginning of the year. Duhnke was sworn in on January 2, replacing James Doty, who stepped down after seven years leading the audit regulator. In addition, Kathleen Hamm, J. Robert Brown, James Kaiser, and Duane DesParte have all assumed board seats since the beginning of the year, representing the first time the board’s makeup has completely turned over in its 15-year history. “The new board looks forward to our first meeting with SAG members and hearing their views about current or emerging issues affecting the work of auditors of public companies,” Duhnke said in a statement.