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Recent Columns by Former FASB Chairman Robert Herz

Robert Herz was chairman of the Financial Accounting Standards Board (FASB), from July 2002 to September 2010. Previously, he was a senior partner with PricewaterhouseCoopers. Prior to joining FASB, Herz was PricewaterhouseCoopers North America theater leader of professional, Technical, Risk & Quality and a member of the firm's Global and U.S. Boards. He was also president of the PricewaterhouseCoopers Foundation, which supports college and university activities. He also served as a part-time member of the International Accounting Standards Board. Herz is both a U.S. Certified Public Accountant and a U.K. Chartered Accountant and a gold medal winner on the uniform CPA examination. Below are his most recent columns:

Navigating the Complex, Impending EU Auditor Rotation Rules

February 25, 2014

Impending EU rules include requirements for mandatory audit firm rotation, as well as restrictions on certain non-audit services and overall caps on the level of non-audit services external auditors can provide to their clients. Inside, columnist Robert Herz looks at how the regulations could affect a number of U.S. companies, particularly those with subsidiaries with listed securities in the European Union or those that have European banking or insurance operations.

XBRL Trends and Challenges

December 31, 2013

A new report finds some interesting trends on how companies are incorporating and using XBRL, the interactive digital tagging system for financial reporting. According to the survey, companies are bringing more of their XBRL process in house, although they continue to face several challenges with preparing XBRL filings and remain concerned about its usefulness compared to the cost. Inside, columnist Robert Herz considers the findings and what it means for the future of XBRL.

Reinforcing the Underpinnings of Accounting Standards

October 29, 2013

The International Accounting Standards Board recently issued a discussion paper as part of its project to revise the conceptual framework that guides the development of its standards. Inside, columnist Robert Herz examines the project and the potential for improving IASB's conceptual framework. Enhancing the underpinnings of accounting, he says, is a necessary step in getting to more consistent and useful financial reporting.

End of Convergence Brings Challenges and Opportunities

August 27, 2013

The program of converging accounting standards between the Financial Accounting Standards Board and the International Accounting Standards Board is nearing an end after more than a decade. Inside, Robert Herz, columnist and former chairman of FASB who was there during the start of convergence, takes stock of what the ambitious partnership has accomplished and what comes next.

Revenue Recognition Standard Will Level the Playing Field

June 25, 2013

After more than a decade in the works, the Financial Accounting Standards Board and the International Accounting Standards Board soon expect to issue converged standards on revenue recognition. Implementing the new standard will entail significant effort and cost by many companies and across the whole reporting system. But, as Columnist Robert Herz writes inside, the project represents a significant improvement in accounting and financial reporting in a crucial area.

Meet the New Standard Setter for Sustainability

April 30, 2013

The Sustainability Accounting Standards Board is the newest organization out to develop industry-specific standards for use by companies to report on material environmental, social, and governance issues in standard filings. Inside, Robert Herz examines SASB's standard-setting process and how it will affect sustainability reporting.

A Look at Efforts to Simplify and Improve Hedge Accounting

February 26, 2013

The International Accounting Standards Board plans to issue a new standard soon intended to improve and simplify hedge accounting and to align it more closely with corporate risk-management activities. Inside, Columnist Robert Herz takes an in-depth look at what the proposal is likely to include, some of the effects it could have on hedging, and how IASB's approach differs from what U.S. regulators are considering.

New Insights on XBRL and Other SEC Reporting Practices

December 11, 2012

A recent survey on financial reporting finds that companies are taking greater responsibility for their XBRL filings by bringing all aspects of their filing practices in house. They also hope to file their SEC documents more quickly and are concerned about the cost and benefits of XBRL. Inside, Columnist Robert Herz examines some recent trends in XBRL filing and other SEC reporting practices.

For an Example of a Successful Transition to IFRS, Look North

October 30, 2012

When the SEC issued its final report on its work plan on International Financial Reporting Standards, it laid out the issues and challenges of adopting international accounting standards in the United States. Inside, Columnist Robert Herz takes a look at how Canada met those challenges when it adopted IFRS. He says the experiences of our neighbor to the north could provide valuable insights into a potential path forward.

A Good Start on Rethinking the Disclosure Framework

August 28, 2012

FASB announced last month a new project to develop a disclosure framework, with the goal of improving the effectiveness of disclosures in the notes to financial statements through clearer communication of the information that matters most to those who read them. Inside, Columnist Robert Herz examines the project's progress so far and its potential to reduce the disclosure burden.

SEC Enforcement Actions Get Personal

June 26, 2012

The SEC's Division of Enforcement has been burning the midnight oil lately, with a record number of enforcement actions in 2011 and no sign of slowing down this year. Many of them are based on allegations of accounting and disclosure manipulations. As Columnist Robert Herz writes inside, there is a clear trend toward the SEC pursuing cases against individual executives.

A Review of the Post-Implementation Review Process

April 24, 2012

A recent development in financial reporting that may have gone overlooked by some amid the flurry of activity is the Financial Accounting Foundation's new post-implementation review process for accounting standards. Inside, Columnist Robert Herz takes a close look at the new review process, including a pilot review of the accounting standard for uncertainty in income taxes.

Embracing Technology in Financial Reporting

February 28, 2012

Over the last few decades, technological advances have been brought to bear on various aspects of the financial reporting process. Yet it hasn't had the kind of transformative effects on accounting and financial reporting that it has had on other aspects of business and life. Inside, Columnist Robert Herz looks at some developments under way that could change that.

A Look Back on a Busy Year in Accounting Developments

December 20, 2011

It's been a rather eventful year in the accounting world as several projects from the Financial Accounting Standards Board move toward completion, including those on fair-value measurement, revenue recognition, and presentation of comprehensive income, not to mention work to move down the path to convergence in general. Inside Columnist Robert Herz surveys the year that was and highlights the biggest developments in accounting in 2011.

Renewed Focus on Mandatory Auditor Rotation

October 25, 2011

The PCAOB has recently begun assessing the potential benefits, costs, and unintended consequences of requiring periodic rotation of auditors by SEC registrants. Advocates of term limits believe rotation could address the conflict of the auditor being paid by the auditee. But the potential for additional costs and disruption to companies are also important factors. Inside, Columnist Robert Herz assesses both sides of the issue.

The Known Unknowns: Uncertainty in Financial Reporting

August 30, 2011

Whether and how uncertainties, such as a contingent legal liability, are reflected in financial statements has always concerned investors, while related accounting and disclosure requirements pose real challenges for issuers and auditors. Inside, Columnist Robert Herz takes a closer look at uncertainties in financial reporting and poses some basic questions to consider when examining them.

More to Consider Than Simply Adopting IFRS or Not

June 28, 2011

This year the SEC is expected to decide on whether to require U.S. issuers to adopt International Financial Reporting Standards in some form. But there are many paths to consider than just outright adoption and the SEC staff has been extensively examining a wide range of issues. Inside, Columnist Robert Herz weighs the many options and avenues along the way.

Don't Take FASB and IASB's 'Netting' Proposal Lightly

April 26, 2011

Earlier this year, U.S. and international accounting standards boards issued a joint proposal on offsetting assets and liabilities on the balance sheet—a process known as "netting." Inside, Columnist Robert Herz looks at the effect the proposal would have on measures of leverage, return on assets, debt covenants, and other contractual agreements.

Pace of Accounting Change Remains Fast and Furious

February 23, 2011

Compliance Week is proud to announce the newest edition to our team of expert columnists: Robert Herz, former chairman of the Financial Accounting Standards Board. In his first column, Herz takes us behind the scenes of the standard-setting process and provides valuable insights on the state of convergence and other big accounting issues.
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