Audit & Accounting Update: October 2019

At Insero, we make it our business to stay abreast of the latest trends and technical updates in accounting, tax, and audit and we understand how important timely updates are to our clients. As a member of the RSM US Alliance, we also have the benefit of access to the resources and subject matter experts of RSM US LLP (formerly known as McGladrey LLP). This includes regular updates on the latest financial reporting insights. We hope that you find these informative and useful, and invite you to reach out to us if you have any questions.

Accounting

Proposed guidance related to classifying debt as current or noncurrent
The FASB has issued a revised proposal on classifying debt as current or noncurrent at the balance-sheet date.
The Financial Accounting Standards Board (FASB) recently issued a proposed Accounting Standards Update (ASU), Debt (Topic 470): Simplifying the Classification of Debt in a Classified Balance Sheet (Current versus Noncurrent). This proposed ASU reflects revisions to the original proposed ASU issued on the topic in January 2017.

Proposed accounting guidance for the effects of reference rate reform
The FASB recently issued a proposal on the accounting for reference rate reform (e.g., the planned discontinuation of LIBOR).
If finalized, the proposed ASU would provide guidance on how entities should account for changes to certain contracts, hedging relationships and other transactions affected by reference rate reform, including the planned discontinuation of the London Interbank Offered Rate (LIBOR). LIBOR is commonly referenced in loans, debt instruments, leases and interest rate derivatives.

Proposed guidance related to classifying debt as current or noncurrent

Source: RSM US LLP
Used with permission as a member of the RSM US Alliance
http://rsmus.com/our-insights/newsletters/financial-reporting-insights.html

As always, we hope you enjoy this edition of our newsletter and we look forward to receiving your feedback. Should you have any questions regarding the information contained in the attached materials or our service offerings, please contact us directly.

Audit & Accounting Update: September 2019

At Insero, we make it our business to stay abreast of the latest trends and technical updates in accounting, tax, and audit and we understand how important timely updates are to our clients. As a member of the RSM US Alliance, we also have the benefit of access to the resources and subject matter experts of RSM US LLP (formerly known as McGladrey LLP). This includes regular updates on the latest financial reporting insights. We hope that you find these informative and useful, and invite you to reach out to us if you have any questions.

Accounting

A guide to accounting for investments, loans and other receivables
Our publication provides a high-level overview of the accounting for investment securities, loans and other receivables.

FASB proposes deferred effective dates for leases, CECL and hedging
If finalized, a recent FASB proposal would defer the effective dates for certain of its guidance for certain entities.

Proposal: Convertible instruments and contracts in an entity’s own equity
A proposed Accounting Standards Update addresses accounting for convertible instruments and contracts in a company’s own equity.

The interaction between ASC 321, ASC 323 and ASC 815
A proposed Accounting Standards Update addresses the interaction of the guidance in ASC 321, ASC 323 and ASC 815.

SEC

Proposed modernization of Regulation S-K Items 101, 103 and 105
The SEC recently issued a proposed rule, which, if finalized, would revise Regulation S-K Items 101, 103 and 105.

FASB Codification update: SEC disclosure update and simplification
The FASB recently issued an Accounting Standards Update that amends various Accounting Standards Codification SEC paragraphs.

A guide to accounting for investments, loans and other receivables

Source: RSM US LLP
Used with permission as a member of the RSM US Alliance
http://rsmus.com/our-insights/newsletters/financial-reporting-insights.html

As always, we hope you enjoy this edition of our newsletter and we look forward to receiving your feedback. Should you have any questions regarding the information contained in the attached materials or our service offerings, please contact us directly.

Audit & Accounting Update: August 2019

At Insero, we make it our business to stay abreast of the latest trends and technical updates in accounting, tax, and audit and we understand how important timely updates are to our clients. As a member of the RSM US Alliance, we also have the benefit of access to the resources and subject matter experts of RSM US LLP (formerly known as McGladrey LLP). This includes regular updates on the latest financial reporting insights. We hope that you find these informative and useful, and invite you to reach out to us if you have any questions.

 

Employee benefit plans

Revised reporting on financial statements of plans subject to ERISA
A recent SAS addresses the auditor’s reporting on financial statements of employee benefit plans subject to ERISA.

 

Accounting

Monitoring inflation when applying ASC 830
The Center for Audit Quality International Practices Task Force framework can be used for monitoring inflation statistics.

Transitioning away from LIBOR
The FASB has added a project to its agenda to address accounting changes necessitated by reference rate reform.

Proposed narrow-scope amendments to credit losses standard
The FASB recently issued a proposed ASU to address issues raised by stakeholders during the implementation of ASU 2016-13.

Proposed deferred CECL effective date and the definition of an SRC
Our article discusses the FASB’s proposed deferred CECL effective date and the SEC’s definition of a smaller reporting company.

Second FASB Staff Q&A document: Estimating expected credit losses
The FASB staff recently issued a Q&A document to address more than a dozen frequently asked questions related to ASU 2016-13.

Source: RSM US LLP
Used with permission as a member of the RSM US Alliance
http://rsmus.com/our-insights/newsletters/financial-reporting-insights.html

As always, we hope you enjoy this edition of our newsletter and we look forward to receiving your feedback. Should you have any questions regarding the information contained in the attached materials or our service offerings, please contact us directly.

Audit & Accounting Update: July 2019

At Insero, we make it our business to stay abreast of the latest trends and technical updates in accounting, tax, and audit and we understand how important timely updates are to our clients. As a member of the RSM US Alliance, we also have the benefit of access to the resources and subject matter experts of RSM US LLP (formerly known as McGladrey LLP). This includes regular updates on the latest financial reporting insights. We hope that you find these informative and useful, and invite you to reach out to us if you have any questions.

Accounting

Updated guide to revenue recognition
We have issued an updated version of our guide to revenue recognition to further assist middle-market companies in applying the new revenue recognition model in Topic 606 with recent activities of the FASB, AICPA and SEC. The guide has been updated for recent developments, including activities of the:

  • FASB, such as the issuance of new Accounting Standards Updates and non-authoritative guidance related to the implementation of ASC 606
  • AICPA, such as the issuance of its revenue recognition guide
  • SEC, such as speeches by SEC staff during the 2018 AICPA Conference on Current SEC and PCAOB Developments, which articulated their views on certain aspects of ASC 606

Updates to our hedging guide for ASU 2019-04
We recently updated our hedging guide for the clarifications made by FASB Accounting Standards Update 2019-04, including those related to having multiple separately designated partial-term fair value hedging relationships of a single financial instrument outstanding at the same time. This summary includes discussion of the effective date and transition provisions of ASU 2019-04 for situations in which ASU 2017-12 has already been adopted and situations in which ASU 2017-12 has not yet been adopted.

business man reading updated guide to revenue recognition

Source: RSM US LLP
Used with permission as a member of the RSM US Alliance
http://rsmus.com/our-insights/newsletters/financial-reporting-insights.html

As always, we hope you enjoy this edition of our newsletter and we look forward to receiving your feedback. Should you have any questions regarding the information contained in the attached materials or our service offerings, please contact us directly.

Audit & Accounting Update: June 2019

At Insero, we make it our business to stay abreast of the latest trends and technical updates in accounting, tax, and audit and we understand how important timely updates are to our clients. As a member of the RSM US Alliance, we also have the benefit of access to the resources and subject matter experts of RSM US LLP (formerly known as McGladrey LLP). This includes regular updates on the latest financial reporting insights. We hope that you find these informative and useful, and invite you to reach out to us if you have any questions.

FASB provides targeted transition relief for CECL
ASU 2019-05 provides the ability to elect the fair value option for certain financial assets upon transition to ASU 2016-13. ASU 2016-13 also modified the accounting for available-for-sale debt securities, which must be individually assessed, and expected credit losses recognized, when fair value is less than the amortized cost basis.

FASB proposes to simplify the accounting for income taxes
The The Financial Accounting Standards Board (FASB) has proposed amendments intended to simplify the accounting for income taxes in accordance with ASC Topic 740. If finalized, the proposed ASU would remove the following exceptions to the general principles in Topic 740.

FASB responds to SEC disclosure update and simplification
The the Financial Accounting Standards Board (FASB) has proposed Codification amendments in response to the SEC’s Disclosure Update and Simplification Initiative. After considering these referred disclosures, the FASB recently issued a proposed Accounting Standards Update (ASU), Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative.

women on computer with note pad and pen next to her reading about FASB proposes to simplify the accounting for income taxes

Source: RSM US LLP
Used with permission as a member of the RSM US Alliance
http://rsmus.com/our-insights/newsletters/financial-reporting-insights.html

As always, we hope you enjoy this edition of our newsletter and we look forward to receiving your feedback. Should you have any questions regarding the information contained in the attached materials or our service offerings, please contact us directly.

Audit & Accounting Update: April 2019

At Insero, we make it our business to stay abreast of the latest trends and technical updates in accounting, tax, and audit and we understand how important timely updates are to our clients. As a member of the RSM US Alliance, we also have the benefit of access to the resources and subject matter experts of RSM US LLP (formerly known as McGladrey LLP). This includes regular updates on the latest financial reporting insights. We hope that you find these informative and useful, and invite you to reach out to us if you have any questions.

Changes to revenue recognition for federal government contractors
We recently published a white paper to assist federal government contractors in understanding the guidance in ASC 606.

Proposed changes to disclosure requirements for income taxes
If finalized, a recent proposed Accounting Standards Update would modify the current disclosure requirements for income taxes.

ASC 842: Lessee transition
We have published a white paper to assist lessees in identifying and understanding the applicable transition guidance in ASC 842.

Treatment of cumulative dividends on preferred stock
Our article addresses questions often raised regarding how and when cumulative dividends should be recognized on preferred stock.

FASB updates the definition of “collections”
Collection-holding entities should be aware of a change to the definition of “collections” and new required disclosures.

Critical audit matters: PCAOB guidance
The PCAOB recently issued guidance related to the requirement for auditors to communicate critical audit matters.

Amendments to modernize and simplify Regulation S-K
The SEC recently issued amendments to modernize and simplify some of the disclosure requirements in Regulation S-K.

 

patrons at an art gallery as the FASB updates the definition of collections for nonprofits, museums

Source: RSM US LLP
Used with permission as a member of the RSM US Alliance
http://rsmus.com/our-insights/newsletters/financial-reporting-insights.html

As always, we hope you enjoy this edition of our newsletter and we look forward to receiving your feedback. Should you have any questions regarding the information contained in the attached materials or our service offerings, please contact us directly.

Audit & Accounting Update: February 2019

At Insero, we make it our business to stay abreast of the latest trends and technical updates in accounting, tax, and audit and we understand how important timely updates are to our clients. As a member of the RSM US Alliance, we also have the benefit of access to the resources and subject matter experts of RSM US LLP (formerly known as McGladrey LLP). This includes regular updates on the latest financial reporting insights. We hope that you find these informative and useful, and invite you to reach out to us if you have any questions.

Changes to revenue recognition in the consumer products industry
We have published a white paper to assist consumer products entities in understanding the new revenue recognition guidance.

Private company accounting for common control arrangements
Our white paper provides insights on private company accounting for variable interest entities under common control.

Business combinations: In motion
Our summary highlights standard-setting activities that affect the content in our Guide to Accounting for Business Combinations.

Market volatility: Consideration of goodwill impairment
Reminder: a significant drop in share price could be a triggering event for the consideration of the impairment of goodwill.

FASB proposes targeted transition relief for CECL
The FASB proposes to allow the option of measuring certain types of assets within the scope of Subtopic 326 at fair value.

 

computer, phone and pens on a desk

Source: RSM US LLP
Used with permission as a member of the RSM US Alliance
http://rsmus.com/our-insights/newsletters/financial-reporting-insights.html

As always, we hope you enjoy this edition of our newsletter and we look forward to receiving your feedback. Should you have any questions regarding the information contained in the attached materials or our service offerings, please contact us directly.

Audit & Accounting Update: January 2019

At Insero, we make it our business to stay abreast of the latest trends and technical updates in accounting, tax, and audit and we understand how important timely updates are to our clients. As a member of the RSM US Alliance, we also have the benefit of access to the resources and subject matter experts of RSM US LLP (formerly known as McGladrey LLP). This includes regular updates on the latest financial reporting insights. We hope that you find these informative and useful, and invite you to reach out to us if you have any questions.

FASB Staff Q&A document: Estimating credit loss reserves
A FASB Staff Q&A addresses use of the WARM method to estimate credit loss reserves for less complex financial asset pools.

ASC 606: Disclosure checklists for public and nonpublic entities
Our disclosure checklists are intended to assist entities in complying with the FASB’s revenue-related disclosure requirements.

Monitoring inflation when applying ASC 830
The CAQ International Practices Task Force has developed a framework that may be helpful in monitoring inflation statistics.

FASB issues narrow-scope amendments to ASC 842
The FASB has addressed three issues lessors sometimes encounter in applying Accounting Standards Codification Topic 842, “Leases.”

Proposed Codification improvements for lessors
The FASB has proposed guidance for two issues lessors sometimes encounter in applying Accounting Standards Codification Topic 842.

Proposed accounting alternatives for not-for-profit entities
The FASB has proposed accounting alternatives for not-for-profit entities for goodwill and certain identifiable intangible assets.

consulting with one another using a calculator

Source: RSM US LLP
Used with permission as a member of the RSM US Alliance
http://rsmus.com/our-insights/newsletters/financial-reporting-insights.html

As always, we hope you enjoy this edition of our newsletter and we look forward to receiving your feedback. Should you have any questions regarding the information contained in the attached materials or our service offerings, please contact us directly.

Audit & Accounting Update: September 2018

At Insero, we make it our business to stay abreast of the latest trends and technical updates in accounting, tax, and audit and we understand how important timely updates are to our clients. As a member of the RSM US Alliance, we also have the benefit of access to the resources and subject matter experts of RSM US LLP (formerly known as McGladrey LLP). This includes regular updates on the latest financial reporting insights. We hope that you find these informative and useful, and invite you to reach out to us if you have any questions.

Accounting

Proposed amendments to credit losses standard
On August 20, the FASB issued a proposal to amend the effective date of ASU 2016-13 for non-public business entities.

Changes to accounting for grants and contributions made and received
Our white paper will help financial statement preparers understand the clarifications made by FASB ASU 2018-08.

FASB proposes narrow-scope amendments to ASC 842
A recent FASB proposal addresses issues lessors sometimes encounter when implementing ASU 2016-02, Leases (Topic 842).

Two working drafts: Allowance for credit losses implementation issues
The AICPA Financial Reporting Executive Committee is requesting comment on two working drafts discussing ASU 2016-13 implementation issues.

Accounting guidance for long-duration insurance contracts
A recent ASU addresses long-duration insurance contracts, such as life insurance, disability income, long-term care and annuities.

Changes to fair value measurement disclosure requirements
Recently issued FASB ASU 2018-13 removes, modifies and adds certain disclosure requirements within ASC Topic 820.

Changes to disclosures for sponsors of defined benefit plans
ASU 2018-14 changes certain disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans.

Accounting for costs of cloud computing implementation
ASU 2018-15 addresses the customer’s accounting for the costs of implementing a cloud computing service arrangement.

Changes to revenue recognition in the industrial products industry
Our white paper explains how FASB ASC 606 could significantly affect entities in the industrial products industry.

SEC

SEC disclosure update and simplification
The SEC recently amended certain disclosure requirements that have become redundant, outdated, overlapping or superseded.

Compliance guide: Amendments to smaller reporting company definition
A recent SEC compliance guide addresses matters related to a final SEC rule that amended the smaller reporting company definition.

aerial business computer

Source: RSM US LLP
Used with permission as a member of the RSM US Alliance
http://rsmus.com/our-insights/newsletters/financial-reporting-insights.html

As always, we hope you enjoy this edition of our newsletter and we look forward to receiving your feedback. Should you have any questions regarding the information contained in the attached materials or our service offerings, please contact us directly.

Audit & Accounting Update: July 2018

At Insero, we make it our business to stay abreast of the latest trends and technical updates in accounting, tax, and audit and we understand how important timely updates are to our clients. As a member of the RSM US Alliance, we also have the benefit of access to the resources and subject matter experts of RSM US LLP (formerly known as McGladrey LLP). This includes regular updates on the latest financial reporting insights. We hope that you find these informative and useful, and invite you to reach out to us if you have any questions.

Substantial accounting changes for nonemployee share-based payments
We have prepared a summary of the accounting changes for nonemployee share-based payments resulting from the issuance of ASU 2018-07. The Financial Accounting Standards Board’s recently updated guidance to align nonemployee share-based payment accounting with employee share-based payment accounting will result in significant measurement changes.

Changes to revenue recognition in the construction industry
Our white paper assists in understanding the application of the new revenue recognition guidance to construction contracts and how a construction contractor could be significantly affected by the new guidance.

Leases: Impact of ASC 842 on the retail and restaurant sector
Our article discusses specific aspects of the new leasing standard that retailers and restaurant operators should consider. To understand these considerations the first step is to understand the full inventory of all contracts that would fall under the new definition of a lease. Understanding the financial reporting and operational impact is imperative also to the middle market.

Monitoring inflation when applying ASC 830
A framework is available to assist in the determination of whether a country’s economy should be considered highly inflationary. The determination of a highly inflationary economy begins by calculating the cumulative inflation rate for the three-year period that precedes the beginning of the reporting period, including interim reporting periods.

accounting achievement aerial

Source: RSM US LLP
Used with permission as a member of the RSM US Alliance
http://rsmus.com/our-insights/newsletters/financial-reporting-insights.html

As always, we hope you enjoy this edition of our newsletter and we look forward to receiving your feedback. Should you have any questions regarding the information contained in the attached materials or our service offerings, please contact us directly.