US Week in Review - Week ending 10 May 2018

    The US Week in Review highlights this week’s developments and emerging issues in the financial reporting world and gives you direct access to relevant technical accounting guidance and thought leadership produced by EY.

    What’s new from EY

    Updated FRD on bankruptcies, liquidations and quasi-reorganizations

    Our Financial reporting developments (FRD) publication on bankruptcies, liquidations and quasi-reorganizations has been updated. See Appendix A for a summary of important changes.

    Podcast on seeking relief from the SEC staff under Rule 3-13

    In our podcast, Steven Jacobs, Mark Kronforst and Julien Boucher discuss relief registrants can seek from financial statement requirements under Rule 3-13 of Regulation S-X. They explain how companies can use the rule to seek relief from the SEC staff, and they provide practical tips. They also note that SEC officials are encouraging companies to make requests for relief under the rule at a time when the SEC is considering broader changes to its disclosure requirements, internal processes and staff guidance as a way to make the public markets more attractive.

    Independent directors: new class of 2017

    In this report, the EY Center for Board Matters analyzes the qualifications and characteristics of independent directors who were elected to the boards of Fortune 100 companies for the first time in 2017. Corporate boards are increasingly looking to add directors who bring diverse perspectives to the boardroom, and our research indicates that companies are expanding voluntary disclosures about board composition.

    Regulatory matters

    Securities and Exchange Commission (SEC)

    Piwowar to step down

    SEC Commissioner Michael Piwowar announced that he will resign on the earlier of 7 July 2018 or the swearing in of his successor. If Mr. Piwowar leaves before a successor is sworn in, the Commission will have four members, which could adversely affect the timing of SEC rulemaking.

    Bricker discusses the US financial reporting structure

    Wes Bricker, chief accountant of the SEC, provides an overview of the Financial Reporting Structure for US public companies in a video posted on the SEC’s website. The SEC also posted three graphics that identify the participants in the US and international financial reporting process and show their roles and relationships.

    Bricker speaks at the 2018 Baruch financial reporting conference

    Wes Bricker, chief accountant of the SEC, highlighted various matters pertaining to new accounting standards, accounting for the effects of income tax reform and non-GAAP financial measures in a speech at the 2018 Baruch College financial reporting conference.

    He also discussed the importance of audit firms appointing independent directors or independent advisory council members with meaningful governance responsibilities. These outside perspectives can foster audit quality and safeguard against noncompliance threats and the resulting costs to the reputation of a firm, its network, and the audit profession generally, he said.

    Standard Setter updates

    Financial Accounting Standards Board (FASB)

    FASB issues ASU to eliminate guidance related to OCC Circular 202

    The FASB issued an Accounting Standards Update eliminating the guidance in ASC 942, Financial Services – Depository and Lending, related to Banking Circular 202, Accounting for Net Deferred Tax Charges, of the Office of the Comptroller of the Currency (OCC), which was rescinded by the OCC.

    9 May 2018 FASB meeting

    The FASB discussed its project on Improving the accounting for asset acquisitions and business combinations. No technical decisions were made. For details, see the FASB’s Tentative Board Decisions.

    Upcoming meetings

    16 May 2018 FASB meeting

    The FASB plans to discuss its project on Consolidation: targeted improvements to related party guidance for variable interest entities. For details, see the FASB’s calendar.

    Upcoming Thought Center webcasts and podcasts

    EY Q2 2018 financial reporting update
    14 June 2018, 1 p.m. Eastern time



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