BDO KNOWLEDGE WEBINAR SERIES...ACCOUNTING UPDATE – DISCUSSION OUTLINE •“Big 3” Convergence...
Transcript of BDO KNOWLEDGE WEBINAR SERIES...ACCOUNTING UPDATE – DISCUSSION OUTLINE •“Big 3” Convergence...
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BDO USA, LLP, a Delaware limited liability partnership, is
the U.S. member of BDO International Limited, a UK
company limited by guarantee, and forms part of the
international BDO network of independent member firms.
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BDO KNOWLEDGE WEBINAR SERIES
Technical Update – Q2 2014
July 9, 10, or 11, 2014
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CPE AND SUPPORT
CPE Participation Requirements ‒ To receive CPE credit for this webcast:
• You’ll need to actively participate throughout the program.
• Be responsive to at least 75% of the participation pop-ups.
Certificate of Attendance:
If you are logged in the entire time and respond to all participation pop-ups, you will be able to print your
certificate from the “Participation” section at the end of the webcast. If you log out before printing your
certificate:
• BDO USA professionals ‒ CPE will automatically be issued in CPE Tracking & Reporting at the end of
every week. A copy of your certificate will be sent after you have been issued credit.
• Clients and Contacts and all other individual participants ‒ You will be emailed instructions on how
to access your certificate.
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CPE AND SUPPORT (CONTINUED) Group Participation ‒ To receive credit:
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LearnLive Participant Guide, which can be found by searching “LearnLive Participant Guide” on the
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LEARNING OBJECTIVES
Upon completion of this course participants will be able to:
• Recognize recently released FASB guidance and
appropriately implement relevant guidance to their
business
• Describe project and proposal stage literature that may
have a broad impact on financial reporting
• Analyze pitfalls in implementing new guidance
• Discuss recent and proposed SEC and PCAOB rulemaking
and activities
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PRESENTERS
• Accounting Update
Adam Brown, National Assurance Partner, BDO USA, LLP
• SEC Matters Update
Jeff Lenz, National Assurance Partner, BDO USA, LLP
• PCAOB and Other Matters Update
Wendy Hambleton, National Director of SEC Practice, BDO USA, LLP
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Accounting Update
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ACCOUNTING UPDATE – DISCUSSION OUTLINE
• “Big 3” Convergence Projects
o Revenue
o Leases
o Financial Instruments
• Other FASB, EITF and PCC matters
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REVENUE RECOGNITION
• New ASU – May 28th
• Public companies - annual periods
beginning after December 15, 2016,
e.g., 12/31 public companies apply
the standard in the quarter ended
March 31, 2017.
• Nonpublic companies will have an
additional year to adopt.
• Some companies already requesting a
delay.
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REVENUE RECOGNITION
Implementation is underway
• Joint FASB and IASB Transition Resource Group
• SEC staff outreach
• AICPA industry initiative
Resources
• Separate revenue webinar on 7/14 and 7/15:
http://www.bdo.com/acsense/RevenueRecognitionJuly2014/
• Flash Report: http://www.bdo.com/download/3279
• In-depth BDO publication coming this summer…
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LEASES – Q2 DECISIONS
• Variable payments:
o Day 1 - include index-based payments (e.g., CPI escalator)
measurement based on the rate at commencement.
o Day 2 - only reassess when the lease liability is reassessed for other
reasons (e.g., contract modification). Otherwise, changes in the
index are period expenses.
• In-substance fixed payments are included in Day 1 lease liability,
consistent with current practice.
• Discount rate - use the rate implicit in the lease if determinable,
otherwise use incremental borrowing rate.
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LEASES – Q2 DECISIONS
• Modification: Any change to contractual terms and conditions of a lease that
was not part of the original terms and conditions of a lease.
o New lease: additional right of use priced on a standalone basis
o Modifications generally require adjustment to the lease asset and liability
without affecting the P&L. However, a reduction of the lease’s scope would
reduce the lease asset and liability, as well as the P&L.
• Contract combinations: multiple contracts should be combined when entered
into with the same counterparty if the contracts are negotiated as a package or
the price in one depends on the other.
• Substitution rights: additional guidance allowing lessees to assume a
substitution right is not substantive if impractical to prove otherwise.
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LEASES – Q2 DECISIONS
• Separation: Affirmed the requirement to separate lease and nonlease
components, although lessees may elect to treat entire arrangement as a lease.
• Initial direct costs: includes only incremental costs; internal cost allocations
cannot be capitalized.
• Subleases: intermediate lessor determines classification based on lessor’s
underlying asset.
• BS presentation: Type A and B assets and liabilities cannot be comingled.
Further, lessees should report them separate from other assets and liabilities on
the balance sheet, or disclose them separately in the footnotes.
• CF presentation:
o Lessors: lease inflows are operating
o Lessees: Type A payments split between operating (interest) and financing
(principal). Type B payments are operating.
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FINANCIAL INSTRUMENTS – Q2 DECISIONS • Classification and Measurement
o Retained an unconditional fair value option.
o Changes in “own credit risk” to be presented in OCI for liabilities
subject to FVO.
o The assessment of a valuation allowance for a deferred tax asset
related to an AFS debt security should be made in combination with
the entity’s other deferred tax assets.
o Retained current US GAAP for loan commitments, revolving lines of
credit, and commercial letters of credit.
o Also retained current guidance for foreign currency gains and losses
on debt securities classified as available for sale (not separated in
net income).
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FINANCIAL INSTRUMENTS – Q2 DECISIONS
• Impairment
o Loan subsequently identified for sale – upon reclassification, retain the amortized
cost basis (excluding the allowance for expected credit losses) as the loan’s cost basis
and recognize a valuation allowance equal to the amount by which the amortized cost
basis exceeds fair value.
o Security subsequently identified for sale - adjust its impairment allowance for the
debt security to be equal to the difference between the debt security’s fair value and
its amortized cost basis.
• Certain presentation and disclosure matters were also discussed.
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FASB UPDATE
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FINAL ASUS ISSUED Q2 2014
ASU 2014 - Title FASB EITF
08 Reporting Discontinued Operations and
Disclosures of Disposals of Components of an
Entity
X
09 Revenue from Contracts with Customers X
10 Development Stage Entities: Elimination of
Certain Financial Reporting Requirements,
Including an Amendment to VIE Guidance in
Topic 810, Consolidation
X
11 Repurchase-to-Maturity Transactions,
Repurchase Financings, and Disclosures
X
12 Accounting for Share-Based Payments When
the Terms of an Award Provide That a
Performance Target Could Be Achieved after
the Requisite Service Period
X
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ASU 2014-08: DISCONTINUED OPERATIONS
Changes the criteria for reporting discontinued operations:
• Changes the definition so that only major strategic shifts are reported in
discontinued operations.
• Examples of a strategic shift could include a disposal of a major geographical
area, line of business, equity method investment.
• Revised definition also includes a business or nonprofit activity that, on
acquisition, meets the criteria to be classified as held for sale.
Eliminates extensive continuing involvement test in current GAAP.
Significant amount of new disclosures, including disposals that don’t qualify as
“major”.
Flash Report: http://www.bdo.com/download/3180
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ASU 2014-10: DEVELOPMENT STAGE ENTITIES
Eliminates definition of development stage entity (DSE), as well as the
requirements to:
• Present inception-to date information on the statements of income, cash flows,
and shareholder’s equity
• Label the financial statements as those of a development stage entity
• Disclose a description of the development stage activities in which the entity is
engaged
• Disclose in the first year in which the entity is no longer a development stage
entity.
Eliminates guidance on variable interest entities for DSEs from Topic 810.
Introduces new disclosures of risks & uncertainties under Topic 275.
Flash Report: http://www.bdo.com/download/3283
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ASU 2014-11: REPURCHASE AGREEMENTS
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Current US GAAP ASU 2014-11
Distinguishes between repos and
repos to maturity.
Both required to be treated as
secured borrowings.
Repurchase financing may be
accounted for as a linked
transaction.
Repurchase financing to be
accounted for separately from
initial transfer, resulting in
secured borrowing treatment.
Additional disclosures required for transactions in addition to
those noted above.
Flash report: http://www.bdo.com/download/3302
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ASU 2014-12: PERFORMANCE AWARDS
• Example: Award with two-year service requirement that vests upon an IPO
anticipated in four years.
• Final ASU: Such features should be viewed as performance conditions and
excluded from grant date fair value. Comp charge recognized when
performance is considered “probable.”
o Considered more operational than reflecting in grant date fair value.
o Not expected to change practice for most companies.
Flash Report: http://www.bdo.com/download/3303
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EITF AND PCC UPDATE
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EITF JUNE MEETING
• Final decision: Issue No. 12-G, "Measuring the Financial Assets and the Financial
Liabilities of a Consolidated Collateralized Financing Entity”
o Option to use more observable of assets or liabilities to determine fair value
• Final decision: Issue No. 13-F, "Classification of Certain Government Insured
Residential Mortgage Loans upon Foreclosure“
o Reclassify mortgage loan to other receivable (instead of real estate owned)
o Expanded scope to include fully government-guaranteed non-residential loans
o Also expanded to include partially government-guaranteed loans when the amount to
be received is fixed and determinable
• Issue No. 13-G, "Determining Whether the Host Contract in a Hybrid Financial
Instrument Issued in the Form of a Share Is More Akin to Debt or to Equity“
o No final decisions
o More deliberations planned for September meeting.
• FASB ratification anticipated in July.
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PCC APRIL MEETING
• No final decisions reached at April 29 meeting.
• Discussion topics:
o Intangible assets – exploring approaches for recognizing fewer intangibles
apart from goodwill, particularly customer relationships. Also considering
the impact in an asset acquisition vs. business combination.
o Public business entity – exploring impact of replacing existing “public” and
“private” definition with new PBE definition.
• Next meeting – July 15.
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SEC, PCOAB, and Other
Matters Update
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COMMISSION PROJECTS
• Crowdfunding: http://www.sec.gov/rules/proposed/2013/33-9470.pdf
• Regulation A+: http://www.sec.gov/rules/proposed/2013/33-9497.pdf
• Payments by Resource Extraction Issuers
• Pay Ratio Disclosures:
http://www.sec.gov/rules/proposed/2013/33-9452.pdf
• Other Dodd-Frank Act Rulemaking
• Use of IFRS by Domestic Issuers
• Find a new Chief Accountant
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SEC STAFF ACTIVITIES
• Disclosure Effectiveness (speech at
http://www.sec.gov/News/Speech/Detail/Speech/1370541479332 )
• ASU 2014-08, Reporting Discontinued Operations, vs. Rule 3-15
• ASU 2014-09, Revenue from Contracts with Customers – Implementation
issues
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SEC FOCUS ON FINANCIAL AREAS
• Task Forces formed in 2013 to focus on fraud
• Issues from outcomes of data analysis
o Using XBRL data
• Focus on internal controls
• In FY 2103 17.2% of whistleblower complaints were related to corporate
disclosures and financials
• Focus on “gatekeepers” as well as companies/executives
• Action against audit committee members
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PCAOB UPDATE
Standard Setting Update:
• Audit standard on related parties –
• Planned effective date years beginning after December 15, 2014
• Needs SEC approval to become effective
• Projects for July –December 2014
o Disclosure of engagement partner and other participants
o Auditing accounting estimates
o Auditor’s responsibilities with respect to other accounting firms, individual
accountant and specialists
• Other project – going concern
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AS 18 RELATED PARTIES
• Relationships and transactions with related parties
o Obtain an understanding of RP transactions
o Evaluate if company has properly identified
o Perform specific procedures
o Communicate with AC
• Significant and unusual transactions
o Identify and obtain an understanding
o Fraud considerations
• Financial relationships and transactions with executive officers
2013 USGAAP UPDATE
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ADDITIONAL WEBINARS
BDO Knowledge Webinar Archives:
• Data Breach Essentials (June 2014)
• COSO 2013 Framework – Preparing for Implementation (May 2014)
• Recovering from Deepwater Horizon – There’s Still Time to File (April
2014)
http://www.bdo.com/acsense/archive.aspx
BDO Knowledge Upcoming Webinars:
• Revenue Recognition: Overview of New ASU 2014-09 – July 14 or 15,
2014
http://www.bdo.com/acsense/
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BDO BOARD REFLECTIONS Additional resources accessible via the BDO Board Reflections:
http://www.bdo.com/library/boardreflections.aspx
Recent BDO Publications:
• FASB Flash Reports
• 2013 COSO Internal Control – Integrated Framework – Update on Implementation
Considerations
• BDO Guide to Going Public
• BDO Board Reflections: Perspectives on Executive Succession Planning
• Cybersecurity – Its Impact on the External Audit and Other Recent Developments
• Cybersecurity – A Board Primer
• Private Company Council (PCC) Flash Reports
• Significant Accounting and Reporting Matters Guide
For a complete listing of publications, refer to:
http://www.bdo.com/publications/assurance/
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EVALUATION
We continually try and improve our programming and appreciate
constructive feedback.
Following the program, we will be sending out a thank you e-mail that
contains a link to a brief evaluation.
Thank you in advance for your participation!
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CONCLUSION THANK YOU FOR YOUR PARTICIPATION!
Certificate Availability: If you participated the entire time and responded to at least 75% of
the participation pop-ups, click the “Participation” button below to access the print
certificate button.
Group Participation Reminder ‒ to receive credit:
Sign-in sheets must list a Proctor name and CPA license number.
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“Service Catalog” in the left menu, then under Training & Development, “Make a Request”.
Clients and Contacts – email sign-in sheets to [email protected] within 24 hours of the webcast.
Alliance Members ‒ should proctor their own group participants. This process is detailed in the
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Unfortunately, we cannot currently support group CPE for International Firms. Those wanting CPE
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Please exit the course by clicking on the red “X” in the upper right corner.
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APPENDIX Effective Dates of U.S. Accounting Pronouncements
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ACCOUNTING PRONOUNCEMENTS EFFECTIVE DATES PRONOUNCEMENT EFFECTIVE DATE – PUBLIC EFFECTIVE DATE – NON PUBLIC
ASC 205, Presentation of Financial Statements
ASU 2013-07, Liquidation Basis of
Accounting Effective for entities that
determine liquidation is
imminent during annual
reporting periods beginning
after December 15, 2013. Early
adoption is permitted.
Effective for entities that
determine liquidation is
imminent during annual
reporting periods beginning
after December 15, 2013. Early
adoption is permitted.
ASC 220, Comprehensive Income
ASU 2013-01, Reporting of Amounts
Reclassified Out of Accumulated
Other Comprehensive Income
Effective prospectively for
reporting periods beginning
after 12/15/2012.
Effective prospectively for
reporting periods beginning
after 12/15/2013. Early
adoption is permitted.
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ACCOUNTING PRONOUNCEMENTS EFFECTIVE DATES PRONOUNCEMENT EFFECTIVE DATE – PUBLIC EFFECTIVE DATE – NON PUBLIC
ASC 205, Presentation of Financial Statements and ASC 360, Property, Plant, and Equipment
ASU 2014-08, Reporting
Discontinued Operations
and Disclosures of Disposals
of Components of an Entity
Effective for annual periods
beginning on or after December
15, 2014, and interim periods
within those years.
Entities should not apply the
amendments to a component of
an entity (or a business or
nonprofit activity) that is
classified as held for sale before
the effective date even if it is
disposed of after the effective
date. That is, the ASU must be
adopted prospectively. Early
adoption is permitted, but only
for disposals (or classifications as
held for sale) that have not been
previously reported in the
financial statements.
Effective for annual periods beginning
on or after December 15, 2014, and
interim periods within annual periods
beginning on or after December 15,
2015.
Entities should not apply the
amendments to a component of an
entity (or a business or nonprofit
activity) that is classified as held for
sale before the effective date even if it
is disposed of after the effective date.
That is, the ASU must be adopted
prospectively. Early adoption is
permitted, but only for disposals (or
classifications as held for sale) that
have not been previously reported in
the financial statements.
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ACCOUNTING PRONOUNCEMENTS EFFECTIVE DATES PRONOUNCEMENT EFFECTIVE DATE – PUBLIC EFFECTIVE DATE – NON PUBLIC
ASC 230, Statement of Cash Flows
ASU 2012-05, Not-for-Profit
Entities: Classification of the Sale
Proceeds of Donated Financial Assets
in the Statement of Cash Flows (a
consensus of the FASB Emerging
Issues Task Force)
Not applicable to public
entities.
Effective prospectively for fiscal
years, and interim periods
within those years, beginning
after 6/15/2013. Retrospective
application to all prior periods
presented upon the date of
adoption is permitted. Early
adoption from the beginning of
the fiscal year of adoption is
permitted. For fiscal years
beginning before 10/22/2012,
early adoption is permitted only
if an NFP’s financial statements
for those fiscal years and
interim periods within those
years have not yet been made
available for issuance.
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ACCOUNTING PRONOUNCEMENTS EFFECTIVE DATES PRONOUNCEMENT EFFECTIVE DATE – PUBLIC EFFECTIVE DATE – NON PUBLIC
ASC 310, Troubled Debt Restructuring by Creditors
ASU 2014-04, Reclassification of
Residential Real Estate collateralized
consumer Mortgage Loans upon
Foreclosure (a consensus of the FASB
Emerging Issues Task Force)
Effective for annual periods and
interim periods within those
annual periods, beginning after
December 15, 2014. Early
adoption is permitted. An
entity can elect to adopt the
amendments in this update
using either a modified
retrospective transition method
or a prospective transition
method.
Effective for annual periods
beginning after December 15,
2014, and interim periods
within annual periods beginning
after December 15, 2015. Early
adoption is permitted. An
entity can elect to adopt the
amendments in this update
using either a modified
retrospective transition method
or a prospective transition
method.
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ACCOUNTING PRONOUNCEMENTS EFFECTIVE DATES PRONOUNCEMENT EFFECTIVE DATE – PUBLIC EFFECTIVE DATE – NON PUBLIC
ASC 323, Investments – Equity Method and Joint Ventures
ASU 2014-01, Accounting for
Investments in Qualified Affordable
Housing Projects (a consensus of the
FASB Emerging Issues Task Force)
Effective for annual periods and
interim reporting periods within
those annual periods, beginning
after December 15, 2014. Early
adoption is permitted. If
adopted, the amendments in
this Update should be applied
retrospectively to all periods
presented. A reporting entity
that uses the effective yield
method to account for its
investments in qualified
affordable housing projects
before the date of adoption
may continue to apply the
effective yield method for those
preexisting investments.
Effective for annual periods
beginning after December 15,
2014, and interim periods
within annual reporting periods
beginning after December 15,
2015. Early adoption is
permitted. If adopted, the
amendments in this Update
should be applied
retrospectively to all periods
presented. A reporting entity
that uses the effective yield
method to account for its
investments in qualified
affordable housing projects
before the date of adoption
may continue to apply the
effective yield method for those
preexisting investments.
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ACCOUNTING PRONOUNCEMENTS EFFECTIVE DATES PRONOUNCEMENT EFFECTIVE DATE – PUBLIC EFFECTIVE DATE – NON PUBLIC
ASC 350, Intangibles – Goodwill and Other
ASU 2014-02, Accounting for
Goodwill (a consensus of the Private
Company Council)
Not applicable to public
entities.
The accounting alternative, if
elected, should be applied
prospectively to goodwill
existing as of the beginning of
the period of adoption and new
goodwill recognized in annual
periods beginning after
December 15, 2014, and interim
periods within annual periods
beginning after December 15,
2015. Early application is
permitted, including application
to any period for which the
entity’s annual or interim
financial statements have not
yet been made available for
issuance.
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ACCOUNTING PRONOUNCEMENTS EFFECTIVE DATES PRONOUNCEMENT EFFECTIVE DATE – PUBLIC EFFECTIVE DATE – NON PUBLIC
ASC 405, Liabilities
ASU 2013-04, Obligations Resulting
from Joint and Several Liability
Arrangements for Which the Total
Amount of the Obligation Is Fixed at
the Reporting Date (a consensus of
the FASB Emerging Issues Task Force)
Effective for fiscal years, and
interim periods within those
years, beginning after
12/31/2013. Early adoption is
permitted. Retrospective
application is required for all
periods presented. Entities are
permitted to use hindsight when
determining the appropriate
amount to be recorded in prior
periods.
Effective for fiscal years ending
after 12/31/2014 and interim
and annual periods thereafter.
Early adoption is permitted.
Retrospective application is
required for all periods
presented. Entities are
permitted to use hindsight when
determining the appropriate
amount to be recorded in prior
periods.
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ACCOUNTING PRONOUNCEMENTS EFFECTIVE DATES PRONOUNCEMENT EFFECTIVE DATE – PUBLIC EFFECTIVE DATE – NON PUBLIC
ASC 606, Revenue
ASU 2014-09,
Revenue from
Contracts with
Customers
Effective for annual periods beginning after
December 15, 2016, including interim periods
therein. Three basic transition methods are
available – full retrospective, retrospective with
certain practical expedients, and a cumulative
effect approach. Under the this alternative, an
entity would apply the new revenue standard only
to contracts that are incomplete under legacy
U.S. GAAP at the date of initial application (e.g.
January 1, 2017) and recognize the cumulative
effect of the new standard as an adjustment to
the opening balance of retained earnings. That
is, prior years would not be restated and
additional disclosures would be required to enable
users of the financial statements to understand
the impact of adopting the new standard in the
current year compared to prior years that are
presented under legacy U.S. GAAP. Early adoption
is prohibited.
Effective for annual periods
beginning after December 15,
2017. In addition, the new
standard is effective for interim
periods within annual periods
that begin after December 15,
2018. The same three transition
alternatives apply. There are
certain provisions that allow for
nonpublic entities to early adopt.
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ACCOUNTING PRONOUNCEMENTS EFFECTIVE DATES PRONOUNCEMENT EFFECTIVE DATE – PUBLIC EFFECTIVE DATE – NON PUBLIC
ASC 718, Compensation—Stock Compensation
ASU 2014-12,
Accounting for
Share-Based
Payments When
the Terms of an
Award Provide
That a
Performance
Target Could Be
Achieved after
the Requisite
Service Period (a
consensus of the
FASB Emerging
Issues Task Force)
Effective for annual periods and interim
periods within those annual periods
beginning after December 15, 2015.
Earlier adoption is permitted.
Entities may apply the amendments in this
Update either (a) prospectively to all
awards granted or modified after the
effective date or (b) retrospectively to all
awards with performance targets that are
outstanding as of the beginning of the
earliest annual period presented in the
financial statements and to all new or
modified awards thereafter. If
retrospective transition is adopted, the
ASU specifies additional transition
considerations.
Effective for annual periods and interim
periods within those annual periods
beginning after December 15, 2015.
Earlier adoption is permitted.
Entities may apply the amendments in
this Update either (a) prospectively to
all awards granted or modified after the
effective date or (b) retrospectively to
all awards with performance targets that
are outstanding as of the beginning of
the earliest annual period presented in
the financial statements and to all new
or modified awards thereafter. If
retrospective transition is adopted, the
ASU specifies additional transition
considerations.
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ACCOUNTING PRONOUNCEMENTS EFFECTIVE DATES PRONOUNCEMENT EFFECTIVE DATE – PUBLIC EFFECTIVE DATE – NON PUBLIC
ASC 720, Other Expenses
ASU 2011-06, Fees Paid to the
Federal Government by Health
Insurers (a consensus of the FASB
Emerging Issues Task Force)
Effective for calendar years
beginning after 12/31/2013,
when the fee initially becomes
effective.
Effective for calendar years
beginning after 12/31/2013,
when the fee initially becomes
effective.
ASC 740, Income Taxes
ASU 2013-11, Presentation of an
Unrecognized Tax Benefit When a Net
Operating Loss Carryforward, a
Similar Tax Loss, or a Tax Credit
Carryforward Exists (a consensus of
the FASB Emerging Issues Task Force)
Effective for fiscal years, and
interim periods within those
years, beginning after
December 15, 2013. Early
adoption is permitted.
Effective for fiscal years and
interim periods within those
years, beginning after
December 15, 2014. Early
adoption is permitted.
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ACCOUNTING PRONOUNCEMENTS EFFECTIVE DATES PRONOUNCEMENT EFFECTIVE DATE – PUBLIC EFFECTIVE DATE – NON PUBLIC
ASC 810, Consolidation
ASU 2014-07, Applying Variable
Interest Entities Guidance to
Common Control Leasing
Arrangements (a consensus of the
Private Company Council)
Not applicable to public
entities.
If elected, the accounting
alternative is effective for
annual periods beginning after
December 15, 2014, and interim
periods within annual periods
beginning after December 15,
2015. Early application is
permitted, including application
to any period for which the
entity’s annual or interim
financial statements have not
yet been made available for
issuance. The accounting
alternative should be applied
retrospectively to all periods
presented. Prospective
adoption is not permitted.
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ACCOUNTING PRONOUNCEMENTS EFFECTIVE DATES PRONOUNCEMENT EFFECTIVE DATE – PUBLIC EFFECTIVE DATE – NON PUBLIC
ASC 810, Consolidation
ASU 2014-10,
Elimination of
Certain Financial
Reporting
Requirements,
Including an
Amendment to
Variable Interest
Entities Guidance in
Topic 810,
Consolidation
Consolidation update – Effective for
annual reporting periods beginning
after December 15, 2015 and interim
periods therein.
The amendments apply retrospectively
and also generally incorporate the
transition provisions of Statement 167
to address situations in which it may
not be practicable to obtain the
necessary information for prior years.
Early adoption is permitted for
financial statements that have not yet
been issued or made available for
issuance.
See also ASC 915, Development Stage
Entities.
Consolidation update – Effective for
annual reporting periods beginning after
December 15, 2016 and interim reporting
periods beginning after December 15,
2017.
The amendments apply retrospectively
and also generally incorporate the
transition provisions of Statement 167 to
address situations in which it may not be
practicable to obtain the necessary
information for prior years.
Early adoption is permitted for financial
statements that have not yet been issued
or made available for issuance.
See also ASC 915, Development Stage
Entities.
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ACCOUNTING PRONOUNCEMENTS EFFECTIVE DATES PRONOUNCEMENT EFFECTIVE DATE – PUBLIC EFFECTIVE DATE – NON PUBLIC
ASC 815, Derivatives and Hedging
ASU 2014-03, Accounting for Certain
Receive-Variable, Pay-Fixed Interest
Rate Swaps – Simplified Hedge
Accounting Approach (a consensus of
the Private Company Council)
Not applicable to public
entities.
If elected, the simplified hedge
accounting approach will be
effective for annual periods
beginning after December 15,
2014, and interim periods
within annual periods beginning
after December 15, 2015. Early
adoption is permitted, and
private companies are able (but
not required) to adopt the new
standards for December 31,
2013 year-end financial
statements that are not yet
available for issuance. Private
companies have the option to
apply the amendments in this
Update using either a modified
or full retrospective approach.
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ACCOUNTING PRONOUNCEMENTS EFFECTIVE DATES PRONOUNCEMENT EFFECTIVE DATE – PUBLIC EFFECTIVE DATE – NON PUBLIC
ASC 815, Derivatives and Hedging
ASU 2013-10, Inclusion of the Fed
Funds Effective Swap Rate (or
Overnight Index Swap Rate) as a
Benchmark Interest Rate for hedge
Accounting Purposes (a consensus of
the FASB Emerging Issues Task Force)
Effective prospectively for
qualifying new or redesignated
hedging relationships entered
into on or after July 17, 2013.
Effective prospectively for
qualifying new or redesignated
hedging relationships entered
into on or after July 17, 2013.
ASC 820, Fair Value Measurement
ASU 2013-09, Deferral of the
Effective Date of Certain Disclosures
for Nonpublic Employee Benefit Plans
in Update no 2011-04
Not applicable to public
entities.
Effective upon issuance for
financial statements that have
not been issued.
25
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ACCOUNTING PRONOUNCEMENTS EFFECTIVE DATES PRONOUNCEMENT EFFECTIVE DATE – PUBLIC EFFECTIVE DATE – NON PUBLIC
ASC 830, Foreign Currency Matters
ASU 2013-05, Parent’s Accounting
for the Cumulative Translation
Adjustment upon Derecognition of
Certain Subsidiaries or Groups of
Assets within a Foreign Entity or of
an Investment in a Foreign Entity (a
consensus of the FASB Emerging
Issues Task Force)
Effective prospectively for all
entities with derecognition
events after the effective date.
The guidance is effective for
fiscal years, and interim periods
within those years, beginning
after 12/31/2013. Early
adoption is permitted. If early
adoption is elected, the
guidance should be applied as
of the beginning of the entity’s
fiscal year of adoption.
Effective prospectively for all
entities with derecognition
events after the effective date.
The guidance is effective for
fiscal years beginning after
12/31/2014 and interim and
annual periods thereafter. Early
adoption is permitted. If early
adoption is elected, the
guidance should be applied as
of the beginning of the entity’s
fiscal year of adoption.
Page 50
ACCOUNTING PRONOUNCEMENTS EFFECTIVE DATES PRONOUNCEMENT EFFECTIVE DATE – PUBLIC EFFECTIVE DATE – NON PUBLIC
ASC 853, Service Concession Arrangements
ASU 2014-05, Service Concession
Arrangements (a consensus of the
FASB Emerging Issues Task Force)
Effective for annual periods and
interim periods within those
annual periods beginning after
December 15, 2014. Early
adoption is permitted. The
amendments should be applied
on a modified retrospective
basis, to all arrangements
existing at the beginning of the
fiscal year of adoption and to
all arrangements entered into
after that date.
Effective for annual periods
beginning after December 15,
2014, and interim periods
within annual periods beginning
after December 15, 2015. Early
adoption is permitted. The
amendments should be applied
on a modified retrospective
basis, to all arrangements
existing at the beginning of the
fiscal year of adoption and to
all arrangements entered into
after that date.
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ACCOUNTING PRONOUNCEMENTS EFFECTIVE DATES PRONOUNCEMENT EFFECTIVE DATE – PUBLIC EFFECTIVE DATE – NON PUBLIC
ASC 860, Transfers and Servicing
ASU 2014-11, Repurchase-to-
Maturity Transactions, Repurchase
Financings, and Disclosures
The accounting changes and
disclosure for certain
transactions accounted for as a
sale are effective for the first
period (interim or annual)
beginning after December 15,
2014. Earlier application for a
public business entity is
prohibited. The disclosure for
transactions accounted for as
secured borrowings is required
for annual periods beginning
after December 15, 2014, and
for interim periods after March
15, 2015.
The accounting changes and
both new disclosures are
effective for annual periods
beginning after December 15,
2014 and interim periods after
December 15, 2015. These
entities may elect early
application and apply the
requirements for interim
periods beginning after
December 15, 2014.
Page 52
ACCOUNTING PRONOUNCEMENTS EFFECTIVE DATES PRONOUNCEMENT EFFECTIVE DATE – PUBLIC EFFECTIVE DATE – NON PUBLIC
ASC 915, Development Stage Entities
ASU 2014-10,
Elimination of
Certain Financial
Reporting
Requirements,
Including an
Amendment to
Variable Interest
Entities Guidance
in Topic 810,
Consolidation
DSE requirements – Effective for annual
reporting periods beginning after
December 15, 2014 and interim periods
therein. While the elimination of the
DSE financial reporting requirements
applies retrospectively, the new
disclosures about related risks and
uncertainties are required
prospectively.
Early adoption is permitted for
financial statements that have not yet
been issued or made available for
issuance.
See also ASC 810, Consolidation.
DSE requirements – Effective for annual
reporting periods beginning after
December 15, 2014, and interim periods
beginning after December 15, 2015. While
the elimination of the DSE financial
reporting requirements applies
retrospectively, the new disclosures about
related risks and uncertainties are
required prospectively.
Early adoption is permitted for financial
statements that have not yet been issued
or made available for issuance.
See also ASC 810, Consolidation.
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ACCOUNTING PRONOUNCEMENTS EFFECTIVE DATES PRONOUNCEMENT EFFECTIVE DATE – PUBLIC EFFECTIVE DATE – NON PUBLIC
ASC 926, Entertainment - Films
ASU 2012-07, Accounting for Fair
Value Information That Arises after
the Measurement Date and its
Inclusion in the Impairment Analysis
of Unamortized Film Costs (a
consensus of the FASB Emerging
Issues Task Force)
Effective for impairment
assessments performed on or
after 12/15/2012. The
amendments resulting from this
Issue should be applied
prospectively. In addition,
earlier application is permitted,
including for impairment
assessments performed as of a
date before 10/24/2012, if, for
SEC filers, the entity’s financial
statements for the most recent
annual or interim period have
not yet been issued.
Effective for impairment
assessments performed on or
after 12/15/2013. The
amendments resulting from this
Issue should be applied
prospectively. In addition,
earlier application is permitted,
including for impairment
assessments performed as of a
date before 10/24/2012, if
interim period financial
statements have not yet been
issued or, for all other entities,
have not yet been made
available for issuance.
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ACCOUNTING PRONOUNCEMENTS EFFECTIVE DATES PRONOUNCEMENT EFFECTIVE DATE – PUBLIC EFFECTIVE DATE – NON PUBLIC
ASC 946, Financial Services – Investment Companies
ASU 2013-08, Financial Services –
Investment Companies (Topic 946):
Amendments to the Scope
measurement and Disclosure
Requirements
Effective for an entity’s interim
and annual reporting periods in
fiscal years that begin after
12/15/2013. Earlier application
is prohibited.
Effective for an entity’s interim
and annual reporting periods in
fiscal years that begin after
12/15/2013. Earlier application
is prohibited.
ASC 954, Health Care Entities
ASU 2012-01, Continuing Care
Retirement Communities –
Refundable Advance Fees
Effective for fiscal years
beginning after 12/15/2012.
Early adoption is permitted.
Entities must apply the
requirements retrospectively by
recording a cumulative-effect
adjustment to opening retained
earnings (or unrestricted assets)
as of the beginning of the
earliest period presented.
Effective for fiscal years ending
after 12/15/2013. Early
adoption is permitted. Entities
must apply the requirements
retrospectively by recording a
cumulative-effect adjustment
to opening retained earnings (or
unrestricted assets) as of the
beginning of the earliest period
presented.
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ACCOUNTING PRONOUNCEMENTS EFFECTIVE DATES PRONOUNCEMENT EFFECTIVE DATE – PUBLIC EFFECTIVE DATE – NON PUBLIC
ASC 958, Not-for-Profit Entities
ASU 2013-06, Services Received
from Personnel of an Affiliate
Not applicable to public
entities.
Effective prospectively for fiscal
years beginning after June 15,
2014, and interim and annual
periods thereafter. A recipient
not-for-profit entity may apply
the amendments using a
modified retrospective
approach under which all prior
periods presented upon the
date of adoption should be
adjusted, but no adjustment
should be made to the
beginning balance of net assets
of the earliest period
presented. Early adoption is
permitted.
Page 56
ACCOUNTING PRONOUNCEMENTS EFFECTIVE DATES PRONOUNCEMENT EFFECTIVE DATE – PUBLIC EFFECTIVE DATE – NON PUBLIC
Other Topics
ASU 2014-06, Technical Corrections
and Improvements Related to the
Glossary Terms
The amendments resulting from
this Update do not have
transition guidance and will be
effective upon issuance.
The amendments resulting from
this Update do not have
transition guidance and will be
effective upon issuance.
ASU 2013-12, Definition of a Public
Business Entity (An Addition to the
Master Glossary)
There is no actual effective
date for the amendment in this
Update. However, the term
public business entity will be
used in Accounting Standards
Updates No. 2014-01 and 2014-
02, which are the first Updates
that will use the term public
business entity.
There is no actual effective
date for the amendment in this
Update. However, the term
public business entity will be
used in Accounting Standards
Updates No. 2014-01 and 2014-
02, which are the first Updates
that will use the term public
business entity.
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ACCOUNTING PRONOUNCEMENTS EFFECTIVE DATES PRONOUNCEMENT EFFECTIVE DATE – PUBLIC EFFECTIVE DATE – NON PUBLIC
Other Topics
ASU 2012-04, Technical Corrections
and Improvements
The amendments in this Update
that do not have transition
guidance are effective upon
issuance for both public entities
and nonpublic entities. The
amendments that are subject to
the transition guidance will be
effective for fiscal periods
beginning after 12/15/2012.
The amendments in this Update
that do not have transition
guidance are effective upon
issuance for both public entities
and nonpublic entities. The
amendments that are subject to
the transition guidance will be
effective for fiscal periods
beginning after 12/15/2013.