Regulatory and Standard Setting

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Ethics Board Proposes Revisions to the Code of Ethics 

The International Ethics Standards Board for Accountants has proposed revisions to the Code of Ethics for Professional Accountants that would establish a comprehensive framework to deal with all forms of inducements. The comment period ends on 8 December 2017.

 

November 2017

College of Knowledge

Baker Tilly Berk is pleased to announce that the videos of the five top keynote speakers from the Baker Tilly International World Conference are now available online.

October 2017

IASB Amends IFRS 9 and IAS 28

The International Accounting Standards Board (IASB) has issued amendments to International Financial Reporting Standards (IFRS): Prepayment Features with Negative Compensation - Amendments to IFRS 9; and Long-term Interests in Associates and Joint Ventures - Amendments to IAS 28. These documents amend IFRS 9, Financial Instruments, and International Accounting Standards (IAS) 28, Investments in Associates and Joint Ventures, respectively.

SEC Adopts Interpretive Guidance on Pay Ratio Rule

The US Securities and Exchange Commission (SEC) has approved interpretive guidance for use by companies in complying with the pay ratio disclosure requirement mandated by Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The SEC pay ratio disclosure rule requires companies to begin making pay ratio disclosures in early 2018.

Case Study Report: Better Communication - Making Disclosures More Meaningful

The International Financial Reporting Standards (IFRS) Foundation has published a case study report showing how companies from different parts of the world have improved communication in their IFRS financial statements.

FASB Amends SEC Paragraphs related to Revenue Recognition and Leases Standards for Public Business Entities

The US Financial Accounting Standards Board (FASB) has issued Accounting Standards Update (ASU) No. 2017-13. This ASU adds, amends, and supersedes SEC paragraphs of the FASB Accounting Standards Codification (ASC) related to the adoption and transition provisions of ASU No. 2014-09, Revenue From Contracts with Customers, and ASU 2016-02, Leases, for public business entities.

September 2017

FASB Proposes Improvements to Grant Accounting

The US Financial Accounting Standards Board (FASB) has issued proposed Accounting Standard Update (ASU), Not-for-profit Entities (Topic 958): Clarifying the Scope and the Accounting Guidance for Contributions Received and Contributions Made. Although the proposed guidance would apply primarily to not-for-profit entities, it would also apply to business enterprises and all other organisations that receive or make contributions of cash and other assets. The comment deadline is 1 November 2017.

IFAC Issues Guidance on Navigating Accountancy Regulations

The International Federation of Accountants (IFAC) has released new guidance to support professional accountancy organisations (PAOs) in navigating their national regulatory environments. 

IPSASB Proposes Improvements to Financial Instruments Reporting 

The International Public Sector Accounting Standards Board (IPSASB) has proposed amendments to International Public Sector Accounting Standards (IPSAS) to conform to the financial instruments accounting standard developed by the International Accounting Standards Board (IASB), International Financial Reporting Standard (IFRS) 9, Financial Instruments. The comment due date is 31 December 2017.


July 2017 

ESMA Proposes Simplification of Prospectus Regulation 

The European Securities and Markets Authority (ESMA) has published three Consultation Papers proposing simplification of the Prospectus Regulation. Each Consultation Paper includes proposals for different aspects of the Prospectus Regulatio

FASB Proposes Eliminating Certain Guidance for Savings and Loans Bad Debt Reserves 

The US Financial Accounting Standards Board (FASB) has issued proposed Accounting Standards Update (ASU), Technical Corrections and Improvements to Topic 942, Financial Services —Depository and Lending: Elimination of Certain Guidance for Bad Debt Reserves of Savings and Loans.

Corp Fin Expands Voluntary Draft Registration Statement Review Submissions

The US Securities and Exchange Commission (SEC) has announced that the Division of Corporation Finance (Corp Fin) will permit all companies to submit draft registration statements relating to initial public offerings (IPOs) for review on a non-public basis. This process will be available for IPOs as well as most offerings made in the first year after a company has entered the public reporting system. The effective date is 10 July 2017.

FASB Proposes Guidance on Variable Interest Entities

In response to recommendations of the Private Company Council (PCC), the US Financial Accounting Standards Board (FASB) has issued the proposed Accounting Standard Update (ASU), Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities.

IASB Proposes Amendments to IAS 16 

The International Accounting Standards Board (IASB) has proposed narrow scope amendments to IAS 16, Property, Plant and Equipment. Comments are due by 19 October 2017.

 

June 2017

SEC Staff Issues FAQs on the IFRS Taxonomy and Inline XBRL

The staff of the US Securities and Exchange Commission (SEC) has published frequently asked questions (FAQs) on the IFRS Taxonomy. This document provides guidance to Foreign Private Issuers preparing their financial statements in accordance with International Financial Reporting Standards (IFRS) and using the IFRS Taxonomy to submit XBRL filings.

IFRS Foundation Publishes Annual Report 

The International Financial Reporting Standards (IFRS) Foundation has published its Annual Report 2016, Better Communication in Financial Reporting (2016 Annual Report), for the year ended 31 December 2016. 

IAASB Proposes New Standard to Modernise Auditing of Accounting Estimates 

The International Auditing and Assurance Standards Board (IAASB) has issued the exposure draft, Proposed International Standard on Auditing 540 (Revised), Auditing Accounting Estimates and Related Disclosures. The comment deadline is 1 August 2017. 

IASB Proposes Narrow-scope Amendments to IFRS 9

The International Accounting Standards Board (IASB) has issued the exposure draft, Prepayment Features with Negative Compensation (Proposed amendments to IFRS 9) (Exposure Draft). The Exposure Draft proposes minor, narrow-scope amendments to International Financial Reporting Standard (IFRS) 9, Financial Instruments, which address concerns expressed by stakeholders relating to how prepayable financial assets should be classified under IFRS 9.

IESBA Proposes Guidance on Scepticism and Judgement

The International Ethics Standards Board for Accountants (IESBA) has published the Exposure Draft, Proposed Application Material Relating to Professional Skepticism and Professional Judgment. The comment period ends 25 July 2017.

FASB Issues ASU on Determining the Customer in Service Concession Arrangements

The US Financial Accounting Standards Board (FASB) has issued Accounting Standards Update (ASU) 2017-10, Service Concession Arrangements (Topic 853): Determining the Customer of the Operation Services. 

ESMA Consults on Money Market Funds Rules 

The European Securities and Markets Authority (ESMA) has issued the Consultation Paper, Draft technical advice, implementing technical standards and guidelines under the MMF Regulation, proposing technical advice and guidelines on the Money Market Funds Regulation (MMFR), in addition to draft implementing technical standards. Comments on the Consultation Paper are due by 7 August 2017. 

IASB Issues Final Contracts Guidance

The International Accounting Standards Board (IASB) has issued International Financial Reporting Standard (IFRS) 17, Insurance Contracts, described by the IASB as a ‘fundamental overhaul of insurance accounting’. IFRS 17 replaces IFRS 4, Insurance Contracts, and in contrast to IFRS 4, IFRS 17 provides comprehensive guidance on accounting for insurance contracts. 

PCAOB Adopts New Standard to Enhance Auditor's Report

The US Public Company Accounting Oversight Board (PCAOB) has adopted a new auditing standard, The Auditor’s Report on an Audit of Financial Statements When the Auditor Expresses an Unqualified Opinion. The new standard requires the auditor's report to include additional important information to investors and is subject to approval by the US Securities and Exchange Commission (SEC).

FASB Improves the Accounting for Modification of Shared-Based Payment Awards

The US Financial Accounting Standards Board (FASB) has issued Accounting Standards Update (ASU) No. 2017-09, Compensation—Stock Compensation (Topic 718) — Scope of Modification Accounting. ASU 2017-09 applies to entities that change the terms or conditions of a share-based payment award.

 

April 2017

FASB Improves the Presentation of Net Periodic Pension Cost and Net Periodic Post-retirement Benefit Cost

The US Financial Accounting Standards Board (FASB) has issued Accounting Standards Update (ASU) No. 2017-07, Compensation — Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. The amendments apply to all employers, including not-for-profit entities, that offer their employees defined benefit pension plans, other post-retirement benefit plans, or other types of benefits accounted for under Topic 715, Compensation — Retirement Benefits.

FASB Issues Proposal to Simplify Accounting for Non-employee Share-Based Payments

The US Financial Accounting Standards Board (FASB) has proposed an amendment to the FASB Accounting Standards Codification to simplify accounting for share-based compensation paid to non-employees. The Proposed Accounting Standards Update (ASU), Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting, is intended to reduce cost and complexity and to improve financial reporting for non-employee share-based payments. Comments are due by 5 June 2017.

EU Parliament Approves Shareholder ‘Say on Pay’ for EU Companies

The European Parliament (EU Parliament) has approved amendments to the Shareholders' Rights Directive that would provide shareholders with stronger rights and require improved disclosure by companies and institutional investors. The new rules will apply to listed companies on European Union (EU) regulated markets, regardless of their industrial sector. The total capitalisation of the affected companies is approximately €8tn.

IASB Publishes Discussion Paper on More Effective Financial Statement Disclosures

The International Accounting Standards Board (IASB) on 30 March 2017 published the Discussion Paper, Disclosure Initiative—Principles of Disclosure (Discussion Paper), proposing recommendations to improve communication in financial reporting through improved disclosures. The comment deadline is 2 October 2017. 

FASB Issues ASU on Premium Amortisation

On 30 March 2017, the US Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2017-08, Receivables—Nonrefundable Fees and Other Costs (Subtopic 310-20), Premium Amortization on Purchased Callable Debt Securities. The ASU shortens the amortisation period for certain callable debt securities held at a premium to the earliest call date. 

European Commission Launches Consultation on Operation of Supervisory Authorities

The European Commission (Commission) has launched a public consultation on the operation of the European Supervisory Authorities (ESAs), including the European Securities and Markets Authority (ESMA), the European Banking Authority (EBA), and the European Insurance and Occupational Pensions Authority (EIOPA). The comment deadline is 16 May 2017. 

ESMA Reports on Market and Valuation Risks

The European Securities and Markets Authority (ESMA) has issued the report, ESMA Report on Trends, Risks and Vulnerabilities No. 1, 2017 (Report), which identifies and discusses the main securities market risk drivers for 2017. The Report concludes that the main risk drivers were political and policy uncertainty, including potential repercussions from the upcoming elections in some European Union (EU) Member States.  

 

March 2017

FASB Issues Not-for-Profit Consolidation Guidance

The US Financial Accounting Standards Board has issued Accounting Standards Update No. 2017-02, Not-for-Profit Entities - Consolidation (Subtopic 958-810): Clarifying When a Not-for-Profit Entity That Is a General Partner or a Limited Partner Should Consolidate a For-Profit Limited Partnership or Similar Entity.

FASB Issues Proposed Changes on Balance Sheet Debt Classification and Disclosure Requirements for Inventory

The US Financial Accounting Standards Board has issued the following proposed Accounting Standards Updates: Debt (Topic 470): Simplifying the Classification of Debt in a Classified Balance Sheet (Current versus Noncurrent) and Inventory (Topic 330): Disclosure Framework - Changes to the Disclosure Requirements for Inventory.

IESBA Completes First Phase of Ethics Code Restructuring

The International Ethics Standards Board for Accountants has announced completion of the first phase of its project to restructure its Code of Ethics for Professional Accountants and has released exposure drafts of proposals to strengthen ethics requirements for accountants.

EU Court of Auditors Calls for European Commission to Simplify Further EU Financial Regulation

The European Court of Auditors has issued an opinion calling for the European Commission to further simplify its proposal to revise the European Union Financial Regulation.

PCAOB Publishes Updated Staff Guidance for Form AP

The US Public Company Accounting Oversight Board has issued updated staff guidance for Form AP, Auditor Reporting of Certain Audit Participants, to be used by firms to disclose the names of engagement partners and other firms participating in public company audits.

FASB Simplifies the Goodwill Impairment Test

The US Financial Accounting Standards Board has issued Accounting Standards Update No. 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment.

IPSASB Issues Standard on Public Sector Combinations

The International Public Sector Accounting Standards Board has issued International Public Sector Accounting Standard 40, Public Sector Combinations, which establishes international requirements for public sectors in accounting for combinations of entities and operations.

ESMA Launches Q&A Tool

The European Securities and Markets Authority has developed a tool for use by stakeholders to access the Questions and Answers developed by ESMA.

IOSCO Publishes Analysis of Potential of Tech-Driven Change in Securities Market Industry

The International Organization of Securities Commissions has published the report, IOSCO Research Report on Financial Technology, which highlights the intersection between financial technology and securities market regulation.

IESBA Releases Q&As on Responding to Non-Compliance with Laws and Regulations

The staff of the International Ethics Standards Board for Accountants (IESBA) have published two Question and Answer publications to support the adoption and implementation of the IESBA standard, Responding to Non-Compliance with Laws and Regulations.

FASB Clarifies the Derecognition of Nonfinancial Assets Guidance

The US Financial Accounting Standards Board has issued Accounting Standards Update No. 2017-05, Other Income – Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets.

IAASB Publishes Work Plan for 2017-2018

The International Auditing and Assurance Standards Board has published its Work Plan for 2017–2018: Enhancing Audit Quality.

FASB Changes Master Trust Investments Disclosures for Benefits Plans

The US Financial Accounting Standards Board has issued Accounting Standards Update No. 2017-06, Plan Accounting: Defined Benefit Pension Plans (Topic 960); Defined Contribution Pension Plans (Topic 962); Health and Welfare Benefit Plans (Topic 965): Employee Benefit Plan Master Trust Reporting.

IFIAR Publishes 2016 Annual Inspection Findings

On 3 March 2017, the International Forum of Independent Audit Regulators published its Report on 2016 Survey of Inspection Findings, its fifth annual survey of IFIAR members’ findings from inspected audit reports, as well as the 2016 Annual Inspection Survey Stakeholder Announcement.

Apple Challenges EC’s Use of Arm’s Length in State Aid Case

Apple released its grounds for appealing the €13 billion (US$14 billion) tax bill from the European Commission earlier this week, arguing that the Commission’s arm’s-length test did not comply with EU laws for determining state aid in tax assessments.

January 2017

IFRS Foundation Amends IFRS Constitution

The Trustees of the IFRS Foundation have amended the IFRS Foundation Constitution to implement changes based on their 2015 Review of Structure and Effectiveness (2015 Review).

European Commission Proposes New Rules for the Recovery and Resolution of Central Counterparties

The European Commission has proposed a framework for the European Union of new rules for central counterparty recovery and resolution, the purpose of which is to ensure that failure of central counterparty can be dealt with effectively to avoid overall risk to the system.

IPSASB Staff Publishes Background Paper on Emissions Trading Schemes

The staff of the International Public Sector Accounting Standards Board have developed Emissions Trading Schemes Staff Background Paper.

SEC Chair White Calls for SEC to Continue Pursuit of High-Quality, Globally Accepted Accounting Standards

Mary Jo White, outgoing Chair of the US Securities and Exchange Commission (SEC), issued a public statement urging the SEC to continue to pursue high-quality, globally accepted accounting standards.

EFRAG Endorses IFRS 4 Amendments for Use in EU

The European Financial Reporting Advisory Group has formally endorsed the International Accounting Standards Board amendments to IFRS 4, Insurance Contracts, issued in September 2016, for use across European Union member states.

IASB Issues Exposure Draft on Annual Improvements to IFRS

The International Accounting Standards Board has issued its exposure draft, Annual Improvements to IFRS Standards 2015-2017 Cycle, proposing amendments to three standards as part of its annual improvements process.

FASB Clarifies the Definition of a Business

The US Financial Accounting Standards Board (FASB) has issued Accounting Standards Update (ASU) 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business.