The Private Company Financial Reporting Committee received an update on the Financial Accounting Standards Board’s efforts to bring U.S. GAAP into line with International Financial Reporting Standards, especially in how that effort would relate to private companies.

The PCFRC, which is a FASB committee that receives administrative support from the American Institute of CPAs, received an update on Monday and Tuesday from FASB board members about the status of various standards, according to PCFRC chair Judy O’Dell. Board member Larry Smith attended the meeting, and the committee was also briefed by FASB staff members on particular projects in which they were involved. As part of FASB’s increased efforts to reach out to private companies and forestall the establishment of a separate board for private company standard setting, at least one board member will be present from now on at all PCFRC meetings. FASB board members have attended all the PCFRC meetings since April 2010, according to a FASB spokesperson.

The PCFRC heard Monday about the status of the consolidations project, with one of the FASB staff members calling into the committee meeting about that effort. At the meeting, they also talked about FASB’s investment properties accounting standards project, as well as another project on an employer’s participation in a multi-employer plan.

“We think the solution they’ve come up with will work well in the private company sector,” said O’Dell.

There was also a brief discussion of an Emerging Issues Task Force project on Accounting for Deconsolidation of a Subsidiary That Is In-Substance Real Estate. At greater length, the committee heard about FASB’s top priority projects on financial instruments, revenue recognition and leases.

“We got a status update on those projects,” said O’Dell. “On the revenue recognition project, there are some proposed disclosure differences for private companies. We talked about those and we’re pretty pleased about how that’s shaking out. On the leases project, we talked about related-party lease issues, which is our big issue. Also, month-to-month leases and leases that are unwritten are very common in the private company world and are due to come up in either the next meeting or the meeting afterwards, and we gave the staff our input there.”

O’Dell noted that a white paper will be coming out shortly for public comment on how private company users work with financial statements. At the meeting the committee also heard about the feedback FASB received during a private company webcast on June 17, and how well a new electronic submission form for comments on the goodwill project worked. FASB informed the PCFRC that approximately 21 of the roughly 89 comment letters it received on the goodwill project came from the new electronic feedback form, which is designed to streamline the comment process.

“We were pretty pleased,” said O’Dell. “Some people might not have commented otherwise given the short notice on it.”

There was a wide-ranging discussion Tuesday about what’s in the SEC’s work plan for incorporating International Financial Reporting Standards into the U.S. financial reporting system for U.S. issuers, and how some of the FASB processes could be improved. The final topic of discussion was the Financial Accounting Foundation’s post-implementation review project on FIN 48, Accounting for Uncertainty in Income Taxes.

O’Dell said there was no discussion at the meeting of the issue of setting up a separate board for private company accounting standards. Earlier this year, the Blue-Ribbon Panel on Standard Setting for Private Companies issued a report recommending that FASB’s parent organization, the Financial Accounting Foundation, set up a separate board. The FAF is currently studying the recommendation.

“I think the viewpoint of the committee is that we’re going to let the Financial Accounting Foundation working group do its thing,” said O’Dell. “As a FASB body, it’s not really up to us to comment on that. I’d say we’re very supportive of the FAF process for listening and outreach and so forth.”

The discussion of the SEC’s work plan for incorporating International Financial Reporting Standards focused on how it might work and the problems of implementing it. “There are still lots of differences between IFRS and GAAP,” said O’Dell. “It would take a while before it’s truly converged.”

Even though the SEC work plan mostly deals with public companies, a footnote in the work plan mentions private companies and how IFRS might or might not have an impact on them, O’Dell pointed out.

“We’re waiting for ‘rev rec’ and the lease projects,” said O’Dell. “They will probably be re-exposed and we will review those re-exposure drafts when they come out. The boards will probably need to re-expose them with all of the changes that have been made.”