Nov. 17- At the Financial Executives International conference on current financial reporting issues, Cullen Walsh, an assistant director of technical activities at FASB, said in a news conference that the boards are taking seriously the requests for delay.
He echoed FASB Vice Chairman James Kroeker's statement Oct. 31 at the meeting of the Revenue Recognition Transition Resource Group that the boards had received a number of requests for a deferral of the effective date of the new revenue standard and were planning to do more outreach on the issue.
“So we plan to do an intense amount of outreach in the short term,” Walsh said, “to have discussions with those who are actually involved with implementation, including those companies that we think would be most impacted by the new standard.”
After conducting the outreach, staff accountants would “ask the FASB and the IASB to make a decision in the near term on this question, recognizing that people need clarity on the question one way or another,” he said.
“We’ve had a fair number of comment letters that were submitted requesting a delay,” Walsh said. “We’ve also, though, had conversations with stakeholders that said they do not think that there should be a delay.
Oct. 31–Kroeker also addressed the opposite stakeholder viewpoint at the summer TRG meeting.
“We've had some tell us that they don't actually think the deferral would be warranted, it might actually impact them adversely,” said Kroeker. “And, we've also heard feedback—and this is more third hand—that some haven't even begun the process of adoption,” he said.
Kroeker stated that FASB and its staff will therefore plan on site visits and other outreaches to preparers from both public and private companies across industries, to understand where companies are in their process of adoption, as well as their challenges.
Nov. 6 – The Securities and Exchange Commission's new top accountant James Schnurr voiced skepticism at conference of the Practising Law Institute about the ability of the Transition Resource Group to resolve implementation issues quickly enough for a smooth shift by companies around the world to the new rules.
In a strongly worded Oct. 14 letter to the chairman of FASB, Sen. Carl Levin (D-Mich.) cited the example of five-month-old rules on revenue reporting, as an example of a complete failure of international convergence.
Efforts to align U.S. and international accounting standards around improved prescriptions aren't working and those convergence efforts should be reoriented, the chairman of the U.S. Senate's Permanent Subcommittee on Investigations wrote.
“At a minimum, FASB should issue anti-abuse rules to combat the potential misuse of the principle-based convergence standards and make enforcement of accurate accounting standards both possible and effective,” wrote Levin.
FASB commented that it was preparing a response to the letter.
Compiled by Accounting Policy and Practice editor, Laura Tieger-Salisbury
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