The Financial Accounting Standards Board is considering delaying implementation of its controversial standard on accounting for uncertainty in income taxes for private entitiies.
At a meeting Wednesday, the board discussed expanding the scope of a previous deferral of FASB Interpretation No. 48 for certain nonpublic entities. FASB had decided at its October 1 meeting that the deferral should be limited to only pass-through entities. But at the October 15 meeting, FASB decided to issue a proposed FASB Staff Position to defer FIN 48 for all nonpublic entities until fiscal years beginning after Dec. 15, 2008, rather than limiting the deferral to pass-through entities only.
As decided at the October 1 meeting, the proposed FSP will have a 30-day comment period. The board will subsequently issue a separate FSP that will provide guidance for pass-through entities and provide amendments to the existing disclosure requirements for nonpublic entities. FASB expects to finalize and issue this FSP in the first quarter of 2009.
FIN 48 has already gone into effect for public companies for fiscal years beginning after Dec. 15, 2007. The standard establishes a "more likely than not" threshold for the reporting of uncertain tax positions on financial statements, but has already run into high costs and difficulties at public companies (see Cost, Complexity Clog FIN 48 Compliance).
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