FAF Appoints New Executive Director
John Auchincloss, acting president of the Financial Accounting Foundation (FAF), the parent organization of FASB, has been appointed its executive director, effective immediately. The move is part of several leadership changes at the trustee organization in the last year. “John has long impressed the FAF trustees with his intelligence, thoughtful strategic counsel, and commitment to the FASB and the GASB and their important mission,” FAF Chair Kathleen Casey said in a statement. “I am very pleased that we will continue to benefit from his strong leadership.” Casey, a former SEC commissioner, was appointed chair in December 2019; five new trustees were also named at that time. All started their terms in January. Auchincloss joined the FAF as vice president and general counsel in May 2016. Following the departure of former FAF president and CEO Terresa Polley, he was appointed acting president while a national search was conducted for the post, part of the organization’s standard due process.
IASB Votes to Issue Proposal on Second Phase of Rate Reform
On February 26, the IASB voted to create a proposal that would facilitate the accounting effects of rate reform, the second phase of its effort to address the global regulatory shift away from the London Interbank Offered Rate (LIBOR). The board agreed to issue an exposure draft for a 45-day public comment period, a much shorter timeline than normal. The rules would take effect on or after January 1, 2021, with earlier application permitted, according to board discussions. If the amendments are applied earlier, the company must disclose that fact. IASB staff members said the scope of the exposure document would be narrow in the sense that the exceptions will apply only to those modifications to contractual cash flows that are 1) required as a direct consequence of interbank offered rate (IBOR) reform and 2) done on an economically equivalent basis, as well as to the consequential changes in hedge accounting. Furthermore, the proposed relief is temporary in nature (i.e., it no longer applies once a financial instrument has transitioned from IBOR to an alternative benchmark rate).
IASB’s Trustee Organization Issues Statement on Coronavirus
The IFRS Foundation, the body with oversight of the IASB, has said it is monitoring the impact of coronavirus (Covid-19), but public meetings it hosts in London will go on as planned. Covid-19, which has spread to more than 50 countries, has disrupted global trade and shaken stock markets; the World Health Organization has amped up the risk assessment of the virus worldwide to “very high.” The IFRS Foundation said it shares global concerns about the impact of Covid-19 and is watching developments, guided by statements from public health authorities. “All public meetings hosted by the IFRS Foundation are currently proceeding as planned, with digital access being provided as usual for those who wish to participate in or observe meetings remotely,” the organization said. The announcement specifically means that the Global Preparers Forum (GPF), an IASB advisory panel of financial statement preparers, will take place on March 5 as planned. The GPF will discuss the board’s main standards-setting projects.