FASB FINANCIAL STATEMENT CHANGES COULD BE COSTLY
New York - A report by Fitch Ratings has called into question the cost-effectiveness of the improvements in financial statement presentation proposed by the Financial Accounting Standards Board and its international counterpart.
In October 2008, FASB and the International Accounting Standards Board published a joint discussion paper that proposed significant changes to the current presentation of the balance sheet, income statement and cash-flow statement. The final standards are not expected until 2011.
However, the price of changing the format could be high for companies. "The discussion paper is a good start, although it is unclear whether the benefits of the changes, if enacted in the current form, would outweigh the added costs for users as well as preparers," said Fitch Ratings director Olu Sonola.
The ratings agency believes that the proposed overhaul to financial statements contains several good points, although some of the suggestions will need further evaluation to determine their workability and usefulness. In Fitch Ratings' view, the three overall objectives set forth in the discussion paper - cohesiveness of financial statements, "disaggregation" of line items, and more clarity on liquidity and financial flexibility - should improve the usefulness of statements to users and enhance analysis.
CAQ EXPLAINS PUBLIC AUDITING
Washington, D.C. - The Center for Audit Quality has released a new guidebook to explain to investors, managers and other interested parties the important role played by auditors of public companies.
The Guide to Public Company Auditing aims to give capital market stakeholders an idea of the vital function that public company auditors fulfill in providing transparency and stability in the markets. The guide provides an introduction to and overview of the key processes, participants and issues related to public company auditing.
"Public company auditors bring an essential perspective to the financial reporting dialogue," said CAQ executive director Cindy Fornelli. "Our hope is that this guide will be a useful tool for anyone interested in learning why auditors' independent scrutiny is of such critical importance to capital market transparency."
For more, visit www.thecaq.org.
APEX ANALYTIX ACQUIRED
Pittsburgh - PNC Equity Partners II LP has acquired Apex Analytix, a firm that provides recovery audit services to more than a third of the Fortune 100.
Apex Analytix offers proprietary software to help its clients detect and recover payment errors. The Greensboro, N.C.-based company said that it has saved clients more than $2 billion in overpayments to date with its proprietary FirstStrike software and services.
PNC partner Jack Glover and PNC senior associate Mike Hand will represent the firm on the Apex Analytix board of directors.
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