CPA Observation Post

SEC issues key papers on International Financial Reporting Standards (via @AccountingToday)

The Securities and Exchange Commission issued two staff papers that analyze a possible switch by the U.S. to International Financial Reporting Standards. One paper compares U.S. generally accepted accounting principles with IFRS, and the other details the use of IFRS by foreign companies. The Securities and Exchange Commission is expected to decide by year-end on how international standards could be incorporated in U.S. financial reporting. Read More>>

SEC Chief Accountant Blasts AICPA Private Company Resolution (via @AccountingToday)

Securities and Exchange Commission chief accountant James Kroeker criticized the American Institute of CPAs’ resolution of disapproval against the Financial Accounting Foundation’s proposal to set up a Private Company Standards Improvement Council, calling it a “clear threat to the independence of the FAF.” Read More>>

AICPA survey: Most CPAs support IFRS option (via @AICPA_JofA)

A majority of CPAs say U.S. public companies should have the option to use International Financial Reporting Standards while the Securities and Exchange Commission decides whether to incorporate the standards into U.S. reporting requirements, according to an AICPA survey released Tuesday. The survey revealed that support for IFRS remains high among AICPA members but, in the absence of a clear regulatory timetable, U.S. firms and organizations are delaying planning and preparation for the global standards. Read More>>

Analysis: New PCAOB appointee is key to term-limit proposals

Three of the five members of the Public Company Accounting Oversight Board say they are uncomfortable with the idea of setting mandatory term limits for audit companies, citing higher costs and potential unintended consequences. PCAOB Chairman James Doty and one ally support the proposal. The Securities and Exchange Commission soon will appoint a replacement for one of the proposal's opponents, which could determine whether it and other recently proposed initiatives move forward. Read More>>

New CPA whistle-blower provisions may lead to ethical conflict

In May, the Securities and Exchange Commission approved rules to extend whistle-blower incentives to people who could provide information about possible securities law violations, including CPAs. CPAs cannot receive rewards by reporting possible violations of a client, but they can be rewarded for reporting possible violations of their accounting firms as they work on behalf of a client. This may be an ethical conflict for CPAs, write Jason Rosenthal and Lesley Smith. Read More>>

Debate over incorporation of IFRS in U.S. heats up

As the Securities and Exchange Commission moves closer to deciding whether to incorporate International Financial Reporting Standards, debate intensifies over how it should -- and, more fundamentally, whether it should. Some fear that politics will influence international standards setting. Another argument against the international standards is that accounting transparency in the U.S. has attracted international investors, and it would be foolish to give up that advantage. Read More>>

SEC expands XBRL requirements this week (from @AICPA_JofA)

The next phase of the Securities and Exchange Commission's eXtensible Business Reporting Language implementation program takes effect Wednesday, requiring nearly all public companies using U.S. GAAP to submit data in the fully searchable, digital format. Over the past two years, the largest SEC reporting companies have begun submitting financial information in XBRL, which allows computers to read financial information and use it in analytical tools. Read More>>

FASB's role would change under SEC plan for IFRS

The Securities and Exchange Commission's staff paper on implementation of International Financial Reporting Standards includes a significant change in the role of the Financial Accounting Standards Board. Instead of acting as the principal body that develops and modifies standards under U.S. generally accepted accounting principles, it would develop IFRS. Read More>>

SEC publishes paper on IFRS, calls for comments

The SEC's Office of the Chief Accountant issued a paper describing possible approaches to incorporating International Financial Reporting Standards into the U.S. financial reporting system. The SEC also calls for comments, noting that the staff paper "is not intended to suggest that the Commission has determined to incorporate IFRS or that the discussed framework is the preferred approach or would be the only possible approach." Read More>>

SEC prepares for next phase of XBRL push

The Securities and Exchange Commission provided information for filing financial statements in eXtensible Business Reporting Language to public companies using U.S. GAAP that are required to submit XBRL for periods ending on or after June 15, 2011. For the past two years, the SEC has required the largest reporting companies to submit financial information using XBRL. Now most other public companies, with a few exceptions, will use XBRL. Read More>>