FASB ISSUES PROPOSALS FOR PRIVATE COMPANY ACCOUNTING
Norwalk, Conn. -- The financial accounting standards board has issued for public comment three proposals to address the concerns of private companies about accounting for intangible assets acquired in business combinations, goodwill, and certain types of interest rate swaps under U.S. GAAP. The first proposal modifies the requirement for private companies to separately recognize fewer intangible assets acquired in a business combination. The second proposal would permit amortization of goodwill (the residual asset recognized in a business combination after recognizing all other identifiable assets acquired and liabilities assumed) and a simplified goodwill impairment model. The third proposal would give private companies, other than financial institutions, the option to use two simpler approaches to accounting for certain types of interest rate swaps that are entered into by a private company for the purpose of economically converting its variable-rate borrowing to a fixed-rate borrowing. FASB asked stakeholders to provide comments by aug. 23, 2013.
GAO RECOMMENDS AUDITOR ATTESTATION DISCLOSURES
Washington, D.C. -- The Government Accountability Office recommended in a new report that the Securities and Exchange Commission should consider requiring public companies where applicable to explicitly disclose whether they obtained an auditor attestation of their internal controls. The SEC responded that investors could determine the attestation status from the available information. But without a clear disclosure, the GAO contended that investors may misinterpret a company's status, and therefore, this warrants the SEC's further consideration.
FASB PROPOSES CHANGES TO INSURANCE ACCOUNTING
Norwalk, Conn. -- The Financial Accounting Standards Board is expected to issue a document proposing to improve the financial reporting of insurance contracts, including the measurement of insurance liabilities and the effect on the statement of comprehensive income. Updates would apply to contracts that meet the definition of an insurance contract.The proposal came a week after the International Accounting Standards Board released its own proposals for insurance accounting standards in late June.
