Pay Attention to Inventory Rules When Reporting Freight Costs
Private Company Council (PCC) Chair Candace Wright said she wants to raise awareness about the accounting for freight costs related to inventory as questions have been bubbling up in from private companies. In a closed session, the PCC talked “about an item related to inventory and increasing freight costs related to inventory and whether or not those should be capitalized or expensed,” said Wright during June 23 PCC discussions. The discussions also focused on “whether or not people are actually updating their standard cost items if they’re doing manufacturing.” The topic interests financial statement users—lenders and creditors—because how companies account for freight costs reveal their spending patterns. ASC Topic 330, Inventory, provides solid accounting guidance on increasing freight costs related to inventory, including whether freight costs should be expensed or capitalized, said Wright, a director with Postlethwaite & Netterville, a Louisiana-based accounting and business advisory firm. The PCC is the body that works with the FASB to develop or modify U.S. GAAP for private companies. The issue was raised with respect to current issues in financial reporting that have been cropping up in practice.
ISSB to Issue Consultation Document on Agenda Priorities This Year
The International Sustainability Standards Board’s (ISSB) inaugural meetings on July 20–21, 2022, will include discussions about a document it plans to issue this year about its agenda priorities, according to meeting papers. The board will issue a Request-for-Information (RFI) during the second half of this year to get public feedback in three areas: 1) its strategic direction and activities; 2) the suitability of proposed criteria for assessing the priority of sustainability-related matters, including topics, industries and activities that could be added to its work plan; and 3) a proposed list of sustainability-related matters including topics, industries and activities that could be added to its work plan. Board discussions will help shape the general direction of what to include in the RFI, according to the papers. Public feedback received from the outreach will inform a subsequent discussion with the ISSB at a later decision-making meeting.
Jeremy Osborn Appointed Head of ESG Matters
The Association of International Certified Professional Accountants, which represents the AICPA and the Chartered Institute of Management Accountants (CIMA), announced on July 12 that Jeremy Osborn has been appointed global head of environmental, social, and governance (ESG) matters. Osborn’s hire in this newly-created role represents AICPA & CIMA’s continued commitment “to provide all accounting and finance professionals with the resources, tools and skills they need to support the transition to more responsible business practices, enhance the reliability of ESG-related disclosures and place long-term value creation at the heart of corporate activities and reporting,” the announcement stated. He will be based in London and report to Ash Noah, the association’s vice president and managing director of learning, education and development for management accounting. “This is a key strategic area for our association and the global accountancy profession,” Noah said in a statement. “Jeremy has deep experience in ESG, a strong record of accomplishment and direct experience of engaging with the relevant stakeholders in this category,” he said. “The main focus of his job will be to help both our management accounting and public accounting professionals integrate ESG matters into their strategy, operations and reporting.” Osborn served as director of accountancy relationships at the Value Reporting Foundation (VRF), which is being consolidated into the IFRS Foundation on August 1 to support the work of the new International Sustainability Standards Board (ISSB). At the VRF, he worked with accountancy bodies and leading accounting firms to increase the pace and scale of adoption of integrated reporting, integrated thinking, and sustainability accounting standards across the globe.