The Financial Accounting Foundation’s board of trustees appointed former NASBA chairman Billy Atkinson as chairman of the new Private Company Council, and named the other members of the new council, which will be able to recommend and vote on changes to accounting standards for privately held companies.
The PCC is a new body that will work with the Financial Accounting Standards Board to determine whether and when to modify U.S. GAAP for private companies. It is replacing the Private Company Financial Reporting Committee.
Atkinson served as chairman of the National Association of State Boards of Accountancy from 2009 to 2010. He has been a member of the NASBA board since 2004 and has chaired several of its committees, including the education and audit committees. He was appointed to the Texas State Board of Public Accountancy in 1999 and served as the presiding officer from 2003 to 2005. He chaired the technical standards review enforcement committee, among others, and served on the rules and executive committees.
He was also a member of the Blue-Ribbon Panel on Standard Setting for Private Companies, whose recommendations contributed to the formation of the PCC.
Atkinson retired from practice after working for 39 years at PricewaterhouseCoopers where he served as an audit partner and a risk management partner in the firm's private company services unit. He also served as a member of the American Institute of CPAs Governing Council from 2003 to 2006 and held leadership positions in the Texas Society of CPAs. Atkinson was nominated by the Texas Society of CPAs, the Texas State Board of Public Accountancy and NASBA.
“Billy Atkinson will bring to the PCC a deep understanding of the complex issues facing the FASB as it seeks to serve the best interests of all those who use, prepare, and audit private company financial statements,” said W.M. “Mack” Lawhon, a member of FAF board of trustees and chairman of the trustees’ Private Company Review Committee, which will have oversight responsibility for the PCC. “The appointments made today set the PCC on the path forward to improve the process of setting accounting standards for private companies.”
Also appointed to the PCC were:
• George Beckwith, vice president and CFO of National Gypsum Company in Charlotte, N.C. He was nominated by Nperspective.
• Steven Brown, vice president of US Bank in Portland, Ore. He was nominated by the American Bankers Association.
• Jeffery Bryan, partner, Professional Standards Group of Dixon Hughes Goodman LLP in High Point, N.C.
• Mark Ellis, CFO of PetCareRx Inc. in Chappaqua, N.Y. He was nominated by the AICPA.
• Thomas Groskopf, director and owner of Barnes, Dennig & Co., Ltd. in Cincinnati, Ohio. He was nominated by Mueller Roofing Distributors, Inc. and Barnes, Dennig & Co., Ltd.
• Neville Grusd – president of Merchant Financial Corporation in New York.
• Carleton Olmanson, managing principal of GMB Mezzanine Capital in Minneapolis, Minn. He was nominated by the Office of Paul Volcker.
• Diane Rubin, partner of Novogradac & Company LLP in San Francisco. She was nominated by NASBA.
• Lawrence Weinstock, vice president of finance of Mana Products, Inc. in Long Island City, N.Y.
“On behalf of the FAF, I am pleased to welcome our inaugural PCC members,” said FAF president and CEO Teresa S. Polley in a statement. “More than 100 highly qualified candidates were nominated for the ten seats on the Council, both by organizations and by individuals. As a result, the selection process was very difficult.
She noted that each of the new Council members has demonstrated a strong appreciation for the importance of independent standard-setting, and unwavering commitment toward greater clarity and well-informed decision-making in private company financial accounting and reporting. “Their diverse backgrounds and perspectives will provide valuable insights and leadership to the PCC and the FAF,” Polley added
“The FASB welcomes the appointment of the new members of the PCC and looks forward to working with them to address critical issues facing the users, preparers and auditors of private company financial statements,” said FASB Chairman Leslie F. Seidman in a statement. “Our first task will be to agree on a framework with the PCC for making decisions about whether and when U.S. GAAP should be modified for private companies. We look forward to meeting with the new PCC in the fourth quarter.”
FASB member Daryl E. Buck will serve as the FASB liaison to the PCC.
Members of the PCC, including the chair, are appointed to an initial term of three years, with each member eligible for reappointment.
The PCC will determine whether modifications or exceptions to existing nongovernmental U.S. GAAP are required to address the needs of users of private company financial statements, based on criteria mutually agreed to by the PCC and the FASB. Before being incorporated into U.S. GAAP, PCC recommendations will be subject to a FASB endorsement process. The PCC also will serve as the primary advisory body to the FASB on the appropriate treatment for private companies for items under active consideration on the FASB’s technical agenda.
Among the projects that are expected to be taken up by the PCC are standards such as FIN 48, "Accounting for Uncertainty in Income Taxes," which was the subject of the FAF's first post-implementation review of a FASB standard, and FASB Statement 141R, "Business Combinations," which is the subject of a current post-implementation review.
The structure of the PCC had been a matter of controversy between the AICPA, FASB, NASBA and the FAF, with the AICPA pushing for a more independent board. Those differences may not have been entirely smoothed out, but Atkinson is hopeful.
“I expect the support, resources and understanding of the AICPA," Atkinson said on a conference call with reporters. "They know as well as we do, we all agreed on the Blue Ribbon Panel and all the other venues that there’s a problem that needs to be addressed and solved. The differences merely had to do with the structure of the solution. Obviously if we’re not successful in addressing these as a group, then possibly that issue does not go away. I hope not. I expect that we’re going to be able to whittle at these issues successfully. ... I can’t speak for the AICPA organizationally, but as a member of the AICPA, and as a participant in the process that led up to these decisions, I believe this is a good approach. I believe it addresses a lot of the concerns that were expressed, and it will work. Time will tell."