CICA seminar on integrated reporting features Robert Herz

Robert Herz, the recently retired chair of the US Financial Accounting Standards Board (FASB), will be in Toronto, Canada on November 23, 2011, for a breakfast seminar.

At the seminar, organized by the Canadian Institute of Chartered Accountants (CICA), Mr. Herz will review the proposals outlined in a Discussion Paper, Towards Integrated Reporting – Communicating Value in the 21st Century. The Paper was published on September 12, 2011, by the International Integrated Reporting Committee (IIRC) with a call for comments by December 14, 2011.

The IIRC was established in August 2010 by the Prince of Wales Accounting for Sustainability Project, the Global Reporting Initiative, and the International Federation of Accountants.  The IIRC brings together a cross section of representatives from the corporate, investor, accounting, securities, regulatory and standard-setting communities.

The Discussion Paper features proposals for the development of an International Integrated Reporting Framework and outlines the next steps toward its creation and adoption. The goal of integrated reporting is to provide more comprehensive and meaningful information about how an organization creates and sustains value.

(For more information, see the CICA media release on November 18, 2011.)

PwC Thought Leadership Highlights

Every month, PricewaterhouseCoopers (PwC) delivers a range of Thought Leadership materials that explore key business issues affecting companies around the world. This month the focus is on a variety of issues that address the following questions and more: What's the key to successful business innovation? What are the implications of the proposed FASB/IASB revenue recognition changes? How are businesses adapting to the changing needs of their talent? What's next for nuclear power? (for example, see View:Striking the innovation balance).

Also, experience the popular 10Minutes series on your iPad, now enhanced with new multimedia. With this inaugural issue, 10Minutes on the CEO Agenda, explore the eight pressing questions facing CEOs today, hear about the challenges directly from business leaders around the world. 10Minutes on the Cloud discusses how cloud computing can go beyond cost savings to offer a way to improve innovation and organizational agility, provide better customer engagement, and harness resources to focus on business imperatives.

IASB and FASB Report Progress on Convergence

The International Accounting Standards Board (IASB) and the US Financial Accounting Standards Board (FASB) have published a progress report on their joint convergence projects. Since their previous report in November 2010, the boards have completed five projects. In the next few weeks, the IASB will issue new standards on consolidated financial statements (including disclosure of interests in other entities), joint arrangements and post-employment benefits. Both boards will issue new requirements in relation to fair value measurement and the presentation of other comprehensive income.  In addition, the boards have made progress on the three remaining Memorandum of Understanding (MoU) projects — financial instruments accounting, leasing and revenue recognition — as well as insurance accounting. The boards have also agreed to extend the timetable for the remaining priority convergence projects beyond June 2011 to permit further work and consultation with stakeholders. The convergence projects are targeted for completion in the second half of this year. (Read the full article "IASB and FASB Report Progress on Convergence" at Journal of Accountancy online.

Estimating the Fair Value of Investments

In September 2006, the US Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards (SFAS) 157, Fair Value Measurements (now Accounting Standards Codification [ASC] section 820-10, Fair Value Measurements and Disclosures), with the stated objective of simplifying the measurement and disclosure of fair value information. The application of this guidance to investments in certain nonpublic entities, such as alternative investments, proved more difficult than originally envisioned. Read the CPA Journal article "Estimating the Fair Value of Investments in Entities that Calculate Net Value Per Share" in digital format.

Setting the standard - What you need to know about the FASB and IASB's joint projects

The March 2011 edition of the PricewaterhouseCoopers (PwC) publication, Setting the Standard, is designed to keep readers informed about the most recent developments on the joint standard-setting activities of the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB). In the December 2010 edition, PwC reported that the boards had recalibrated their work plan to focus on the priority projects. The boards continue their sprint toward the targeted June 30, 2011 “finish line,” carefully navigating the hurdles along the way.

CICA/IFRS Foundation Conference - IFRS in North America 2010

The CICA/IFRS Foundation Conference - IFRS in North America 2010 will be held on November 23-24, 2010 (optional sessions November 22) at the Metro Toronto Convention Centre in Toronto, Canada. As the deadline for IFRS adoption looms, this informative two-day event, with optional workshops, is crucial for anyone involved in financial reporting with an organization that is moving to IFRS. It is a unique opportunity to hear the latest IFRS developments directly from the International Accounting Standards Board (IASB), the Canadian Accounting Standards Board (AcSB) and the US Financial Accounting Standards Board (FASB). The most recent regulatory developments from Canada and the US will also be presented.

What are investment professionals saying about financial instrument reporting?

The global financial crisis underscored the profound challenges in financial instrument accounting, prompting the IASB and FASB to address these issues and search for simplicity and consistency. However, they have been moving in separate directions. New research by PricewaterhouseCoopers (PwC) provides another forum for a cross-section of a key stakeholder group – the investors and analysts – to add to this critical debate. Read the June 2010 PwC publication What investment professionals say about financial instrument reporting.

IASB and FASB update to G20 Leaders

The IASB and the FASB issued a letter to the G20 Leaders on June 2, 2010 outlining the modified strategy for completing their convergence work. The letter states that "Reflecting our commitment to timely completion of the major MoU projects, the boards have significantly intensified their interaction. The boards are now meeting jointly for consecutive days on a monthly basis, either in person or by video. The boards have called, and will continue to schedule special joint meetings to address issues requiring timely joint resolution." (Read the IASB Web Announcement.)

IASB - Request for comment on FASB Financial Instruments Exposure Draft

On May 26, 2010, the US Financial Accounting Standards Board (FASB) released a proposed Accounting Standards Update that contains proposals for a new comprehensive standard on financial instruments. Under the FASB’s proposals, many financial assets and financial liabilities would be measured at fair value in the primary financial statements. This is different from the mixed measurement model that is used in IFRS 9 Financial Instruments for financial assets. The appendix to the FASB exposure draft contains a high level comparison of the boards’ respective approaches. The IASB is asking its constituents to submit comment letters on the FASB proposal. Because this project is part of the global convergence project, it is important for the FASB to receive feedback on the proposed model from the international community. (Read the IASB Web Announcement.)

FEI files letter with FASB and IASB on impact of MOU Standards

In a letter dated May 7, 2010, the Committee on Corporate Reporting (CCR) of Financial Executives International (FEI) expressed concern to Robert Herz, chairman of the Financial Accounting Standards Board, and Sir David Tweedie, chairman of the International Accounting Standards Board. The letter was written “to express our significant concern that springs from the unprecedented volume as well as the complexity of proposed standards expected to be issued in the coming months. We urge the Boards to consider the adverse effect that is likely to have on the effectiveness of the Boards’ due process procedures. We have written to you on this subject previously (see our letter dated February 12, 2010 RE: Effective Dates of New Standards), however, we are concerned that actions will not be taken to scale the number and timing of the Exposure Drafts (“EDs”) in a way that permits a fulsome analysis and thorough response from all interested constituents.” (Read the FEI News Release and the CCR Letter to the FASB and IASB.)

Canada - IFRS in North America 2010 Conference

The Canadian Institute of Chartered Accountants (CICA) and the IASC Foundation are hosting a conference IFRS in North America 2010 in Toronto Canada on November 23-24, 2010. This informative two-day event, with optional workshops, is critical for anyone involved in financial reporting with an organization that is moving to International Financial Reporting Standards (IFRS). It is a unique opportunity to hear the latest IFRS developments directly from the International Accounting Standards Board (IASB), the Canadian Accounting Standards Board (AcSB) and the US Financial Accounting Standards Board (FASB). The conference is being held in conjunction with the Financial Reporting and Accounting Conference.

FEI comments on convergence standards

The Financial Executives International (FEI) Committee on Corporate Reporting (CCR) has filed a series of comment letters with the Financial Accounting Standards Board (FASB) Chairman, Robert Herz, and the International Accounting Standards Board (IASB) Chairman, Sir David Tweedie. The letters address concerns regarding the effective dates of the major convergence standards outlined in the FASB and IASB Memorandum of Understanding (MoU). FEI states that the current proposed dates present challenges to realizing a high quality implementation. It recommends that the Board deliberate the effective dates and transition of the major convergence standards holistically, rather than on a standard-by-standard basis, taking into consideration the impact on companies and the interdependencies among the standards. (Read the article FEI Provides Recommendations to FASB and IASB on Convergence Standards at PR Newswire online.)

US - FASB adds new XBRL functionality

Current changes to the US Financial Accounting Standards Board (FASB) Codification follow the Securities and Exchange Commission (SEC) rule effective April 13, 2009, that requires all public companies to begin providing XBRL versions of their SEC filings over a three-year phase-in period. Approximately 500 of the largest public companies, each with a worldwide public float greater than $5 billion, began filing for interim financial statements with periods ending on or after June 15, 2009. The new XBRL functionality provided by the FASB Codification Website will help entities as they prepare or plan to prepare XBRL financial statements using the US Financial Reporting Taxonomy. Users will be able to very easily identify the XBRL elements associated with specific Codification paragraphs. (For more information, visit the FASB Accounting Standards Codification Website.)

FASB initiates project on useful, organized and consistent disclosures

Robert H. Herz, chairman of the United States Financial Accounting Standards Board (FASB) has announced the addition of a new FASB agenda project aimed at establishing an overarching framework to make financial statement disclosures more effective, coordinated and less redundant. The project was added in response to requests and recommendations from constituents including the Investors Technical Advisory Committee and the SEC Advisory Committee on Improvements to Financial Reporting. (Read the FASB Press Release.

Fair Value Accounting: Statement by Paul Cherry, Chair, Canadian Accounting Standards Board

The clarification issued this week by the US Securities and Exchange Commission's Office of the Chief Accountant and the staff of the Financial Accounting Standards Board in relation to fair value accounting requirements is consistent with Canadian accounting standards. In Canada, the Accounting Standards Board has already issued three staff commentaries to help companies apply fair value accounting requirements when dealing with this country's own liquidity crunch. These commentaries provided guidance on how to report to investors on their holdings of Asset-Backed Commercial Paper (ABCP). The first was issued almost a year ago. (View the CICA Media Release and ABCP Commentary.)

Clarifications on Fair Value Accounting

The current market environment makes the determination of fair value particularly challenging for preparers, auditors and users of financial information. In the United States, the Securities and Exchange Commission (SEC) and the Financial Accounting Standards Board (FASB) have engaged in extensive consultations with participants in the capital markets including investors, preparers and auditors, on the application of fair value measurements. The FASB will propose additional interpretative guidance on fair value measurement under US GAAP later this week. (Read the SEC Press Release.)

FEI - Financial Reporting Portal

Find news highlights from the International Accounting Standards Board, FASB and SEC on this "fei financial reporting blog" from the Financial Executives International. The site compiles hot topics from the Web’s largest business and accounting publications and organizations. Look for continuing coverage of fair value reporting and international convergence.

IFRS Conference North America - April 24-25, 2008

The IFRS – North America Conference is a joint presentation by The International Accounting Standards Committee (IASC) Foundation and The Canadian Institute of Chartered Accountants (CICA). It is a significant international event being held in Toronto, Canada, bringing Sir David Tweedie, Chairman of the International Accounting Standards Board (IASB), and other members of the IASB to North America. Other speakers include senior representatives from the Canadian Accounting Standards Board (AcSB), the US Financial Accounting Standards Board (FASB), regulators from Canada and the United States, and international financial reporting experts. For complete conference details and to register on-line, go to the conference-exclusive website (www.cpd.cica.ca/IFRSNA).

Conceptual Framework—Joint Project of the IASB and FASB

The US Financial Accounting Standards Board (FASB) is redeliberating issues related to its Preliminary Views, Conceptual Framework for Financial Reporting: Objective of Financial Reporting and Qualitative Characteristics of Decision-Useful Financial Reporting Information. Specifically, it is addressing concerns raised by respondents about the role of stewardship in the objective of financial reporting and the logical flow of Chapter 1 of the Preliminary Views. The Board has decided that the “objective of general purpose external financial reporting is to provide financial information about the reporting entity that is useful to present and potential investors and creditors in making decisions in their capacity as capital providers.”

IASB issues revised standard on the presentation of financial statements

The International Accounting Standards Board (IASB) has issued a revised version of IAS 1 Presentation of Financial Statements. The revision is aimed at improving users’ ability to analyse and compare the information given in financial statements. The publication of IAS 1 marks the completion of the first phase of the IASB’s joint initiative with the US Financial Accounting Standards Board (FASB) to review and harmonise the presentation of financial statements. The second phase, which has already begun, is examining more fundamental questions about the presentation of information in financial statements and the IASB expects to publish a discussion paper on the subject within the next six months. (View the Press Release or visit the project web page.)