FASB News
Second FASB Forum for CPE Providers Announced
FASB will host its second online training forum next month for professionals and companies who offer accounting continuing professional education (CPE), according to a September 16 board alert. The forum, In Focus: CPE Provider Forum, will be webcast live on October 12 from 1:00 to 3:00 p.m., Eastern Daylight Time (EDT). Participants in the live forum must register in advance. The event will also be archived on the FASB’s website. Attendees in the live forum will be able to submit questions to a FASB panel that includes FASB member Susan Cosper, FASB Deputy Technical Director Nellie Debbeler, FASB Assistant Director—Nonpublic Entities Jeffrey Mechanick, FASB Supervising Project Manager Elizabeth Gagnon, and other FASB staff. Topics of discussion are expected to include current financial reporting issues, recent implementation activities and Accounting Standards Updates, and other select ongoing projects.
IASB News
Robust Disclosure Rules Hoped to Settle Goodwill Amortization Debate
The IASB has set its sights on developing a sufficiently robust package of disclosure rules for the subsequent reporting of goodwill to resolve its debate on whether to move to an amortization model, a step that could ultimately get it closer to converged solutions with U.S. accounting standards setters, September 20 board discussions signaled. Disclosures about goodwill, the intangible asset recorded on the balance sheet in an acquisition, will make it clear whether it would be feasible to amortize goodwill in subsequent reports in a manner that would get investors meaningful information that might be lost if the board does away with the impairment approach. Amortization comprises a fixed expense charge every reporting period over the estimated useful life of goodwill, whereas under the impairment method a company has to test annually to determine whether goodwill’s fair value declined below its carrying value (i.e., whether it is impaired). If there is an impairment loss, it is then reported as a separate item on the income statement and the new adjusted goodwill value is reported in the balance sheet. “The majority of disclosures will be of use regardless of whether you go to amortization or impairment, but part of the disclosures will also talk to the loss of information, the signaling effect that comes with the impairment only approach and therefore may bridge some of the gaps that people will see when asked to make a decision,” IASB Chair Andreas Barckow said.
PCAOB News
Should the Audit Quality Indicators Project be Revived?
One of the recommendations in the Treasury Department’s Advisory Committee on the Auditing Profession (ACAP) was for the PCAOB to consider developing audit quality indicators (AQI) as part of a broader effort to improve audit quality. ACAP made the recommendations in 2008, and the PCAOB put out a preliminary rulemaking document in July 2015, but has yet to go any further. The lack of progress was likely in part due to resistance from audit firms and, to a lesser degree, audit committees, even though many investor advocates pressed the board to complete the project. Now, the person who had suggested that the ACAP include AQIs wants the PCAOB to pick back up again. “This recommendation was well received by many stakeholders, including the Center for Audit Quality,” Robert Conway wrote in a letter to the SEC’s Investor Advisory Committee (IAC), which held a meeting on September 9 about the PCAOB and the audit profession. “However, a series of missteps resulted in the failure of the PCAOB to realize the benefits of this opportunity. This recommendation should be a priority for the PCAOB with full support from the SEC.”
