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 Financial Statement Presentation

Prepare for a Grilling by Auditors During This Year's Close

November 13, 2012

Financial reporting executives are beginning plans for the year-end close, and it could be a rocky one. Revenue recognition, impairments, allowances for loan losses, subjective accruals, and other items are expected to attract attention from audit firms this year. "Anywhere there are subjective estimates that companies are using to support future growth or profitability, there will be pressure," says Mike Santay, a partner at Grant Thornton.

SEC Taking a Closer Look at Use of Non-GAAP Measures

July 03, 2012

The Securities and Exchange Commission is taking a hard look at voluntary disclosures that don't adhere to Generally Accepted Accounting Principles, and while not prohibiting non-GAAP measures, it has an unkind view of those that seem to obscure the truth. "Earnings before bad stuff is where you get into trouble," says Peter Bible, a partner with audit firm Eisner Amper.

Restatements: Let Me Count the Ways

May 30, 2012

When a financial reporting error is identified, companies generally need to decide if a restatement of prior periods is in order, or if correcting it in the current period will suffice. Yet there are multiple ways to correct an error through a restatement. Inside, Columnist Scott Taub looks at the many different types of restatements and offers his views on when each is appropriate.

Accounting: 2012 Could Bring More Questions Than Answers

January 03, 2012

With many of the projects to converge U.S. Generally Accepted Accounting Principles and International Financial Accounting Standards nearing completion, several big questions remain, including what path the SEC will take on whether and how to adopt IFRS. "It doesn't appear those will be resolved or any changes will be effective in 2012," says Bob Dohrer, national director of assurance services for McGladrey & Pullen.

SEC Calls for Companies to Disclose Europe Debt Exposure

December 13, 2011

Staff members of the Securities and Exchange Commission revealed the top items they are paying close attention to during filing reviews, including exposure to the European debt crisis, pension accounting, and goodwill impairment. The SEC is looking carefully at how troubles abroad might affect companies and how they are explaining it to investors, said staff members at a recent conference. Details inside.

Buttoning Up the Year-End Close

December 06, 2011

It's that time again. Companies should be combing through financials to assure their estimates are sound and that they are paying close attention to the issues that regulators are focused on as they prepare to close the books on 2011. And a cloudy economy could mean rethinking some assumptions. "There's more uncertainty in the markets, so more could go wrong," says Kevin Pianko, a partner with accounting firm WeiserMazars.

FASB Project May Reduce Financial Disclosure Burden

September 07, 2011

Public companies could see a reduction in the total amount of financial disclosure they make if the Financial Accounting Standards Board proceeds as planned with a project, still in the early stages, to develop a better, simpler framework for how decisions about financial disclosures are made. That said, deciding what to leave out won't be easy. "The demand for information is virtually unlimited," says John Hepp, a partner at Grant Thornton.

PCAOB Starts Audit Reform Debate

August 23, 2011

The Public Company Accounting Oversight Board launched its shake-up of the auditing world last week, floating the idea of term limits for audit firms and their public company clients. Audit firms blast rotation as a draconian solution ill-suited to industry problems. "When, all of a sudden, do you become not independent?" asks Tim Follett of the firm Mayer Hoffman McCann. "There's no hard line in the sand on that."

XBRL Enters the Final Phase

August 02, 2011

When public companies file their latest financial statements in coming weeks, almost all of them will be required to use the XBRL tagging system for interactive data. The smallest companies have had three years to prepare, but many still struggle with the technology. "I'd say a lot of the smaller, 'Wave 3' companies are still pushing this off," says Raul Varela, vice president at Rivet Software.

PCAOB's Hanson on Audit Reform

June 28, 2011

Jay Hanson and his fellow members of the Public Company Accounting Oversight Board are considering a number of measures to improve quality of external audits. Inside, he answers questions on such topics as reforming the audit report, the role of corporate issuers in audit reform, and the audit inspection process.

It's Back! PCAOB Chairman Floats Auditor Rotation Idea

June 21, 2011

James Doty, chairman of the Public Company Accounting Oversight Board, is threatening to put the idea of term limits for audit firms back on the table, due to what he considers a trend toward low-quality audits. Audit firms and public companies are sure to push back hard, although Doty may just be trying to cajole auditors into making changes preemptively. More inside.

FASB, IASB Pull Up on Financial Statement Presentation

October 27, 2010

With an admission that maybe they’ve bitten off more than they can chew, accounting rulemakers have decided to take a break from two separate projects that once appeared prominently on their priority list for converging U.S. and international accounting rules.The Financial Accounting Standards Board and the International Accounting Standards Board...

FASB, IASB Staff Preview New Financial Statements

July 02, 2010

Staff members at the Financial Accounting Standards Board and the International Accounting Standards Board have published a preview of how a new standard on financial statement presentation might read.The two boards have reached some tentative decisions that are outlined in a draft standard and published to get folks thinking further about...

Financial Statement Presentation Ideas Need More Work

May 18, 2009

The emerging plan to overhaul the presentation of information contained in financial statements is getting calls for a lot more work from all sides of the financial reporting community.The Financial Accounting Standards Board and the International Accounting Standards Board are working on a joint project to reformat financial statements to...

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