Tuesday Jul 30, 2013

Impact of the Upcoming US GAAP and IFRS Lease Accounting Proposal

Back in May 2013, the FASB and the IASB published another Exposure Draft on Lease Accounting, inviting comment through September this year.   Our developers have been reviewing it, and Seamus Moran, our resident IFRS expert, sat with Annette Melatti, Senior Director, Financials Product Marketing, to chat about the potential impact on Lease Accounting and ERP software.  Listen to the podcast for more details.

Seamus also met with Ashima Jain of PwC to take a more detailed look at the specifics of this Exposure Draft.  The proposal is quite a change to existing practice, not only requiring us to put many equipment leases on the balance sheet, but also incorporating new valuation, accounting, and classification of leases.  Watch the new screencast which shares the specifics.

It will be interesting to see how the public reacts when the comment period ends in September, and what route the path to a final new standard takes in 2014 and 2015.

Friday Mar 01, 2013

FASB and IASB Set Effective Date for New Revenue Recognition Standard: January 1, 2017

An update from our resident IFRS expert, Seamus.....The FASB and IASB met on February 20th and put the finishing touches to the new US GAAP and IFRS Revenue recognition principle, Revenue from Contracts with Customers.  As they say on their websites, all that remains is for the staff to begin drafting the final standard.  They decided on the effective date of the standard for new transactions: January 1, 2017

Both the FASB and the IASB are in agreement that early adoption will not be permitted. There are now three arrangements organizations can use during the transitional period, between now and 2017:

1)  Retrospective reporting, where each revenue transaction is tracked under both the old and the new in full
2)  Retrospective reporting exploiting the permitted optional practical expedients previously published
3)  Apply the standard to new post January 2017 initial revenue items, recognize the impact of the change as an adjustment to opening 2017 balance, and disclose the changes

It will be interesting to see how these options are explored by practitioners and professionals.  They have substantially updated the disclosure requirements, introducing some qualitative elements, eliminating the onerous obligation disclosure, and adding some assumptions and methods disclosure.

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Focusing on solutions for the Office of Finance, this blog will highlight key financial management market trends, events and other news of interest.

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