Minor Technical Corrections Published for Lease Standard
FASB has published an update to U.S. GAAP with 16 technical corrections for its much-watched lease accounting standard. The changes are considered editorial in nature and will not affect accounting outcomes, FASB noted. FASB “does not anticipate that entities will incur significant costs as a result of the amendments,” the board said. “The amendments do not create new accounting requirements.” FASB published the lease accounting standard in February 2016 in ASU No. 2016-02, Leases Table of Contents (Topic 842), after a decade of debate. It requires companies to report on their balance sheets their leased office space, storefronts, vehicles, and equipment as assets, and the rent they owe for them as liabilities. The standard goes into effect in 2019 for public businesses and is expected to cause significant changes to company balance sheets.
IFRS Foundation Taps Finnish Central Banker as Next Chairman
The IFRS Foundation, the IASB’s parent organization, has named Erkki Liikanen, governor of Finland’s central bank for the past 14 years, as its new chairman. Liikanen replaces Michel Prada, who has been the chair since 2012. Liikanen’s first three-year term begins in October; the IFRS Foundation recently proposed amending its charter to permit the chairman to serve nine years instead of the current limit of six years. Prada’s second term expired in December 2017, but he agreed to stay on until his successor was named. Prada issued a statement that said, in part, that he wished Liikanen “a successful leadership of the Foundation on the road towards global adoption of IFRS.” Jean-Paul Servais, chair of the Monitoring Board, the international panel of financial regulators that oversees the IFRS Foundation, remarked, “Erkki’s wealth of international experience at the most senior levels, his breadth of knowledge of the financial sector, as well as his international network and diplomatic skills, will be instrumental in leading the IFRS Foundation in this period.”
IFRS Interpretations Committee Asked to Assess Accounting for Digital Currencies
After months of questions about the accounting for the rapidly growing digital currency market, on July 17 the IASB agreed to a limited response and asked its IFRS Interpretations Committee (IFRIC) to study the issue. IASB Vice Chair Sue Lloyd stated that the members of the committee would be able to sift through the accounting literature and give the IASB information about the most appropriate accounting treatment for cryptocurrencies and initial coin offerings. “As a secondary question, assuming we are clear where we land, does it give us a good outcome or not?” Lloyd said. “Just pretending it’s all OK is probably a risky strategy.” The IASB has fielded questions from around the world about whether businesses should consider digital currencies inventory, investments, or intangible assets for accounting purposes. An IASB staff member said the board is asked at almost every public forum when it plans to address the questions.