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SEC

1/06/09 - SEC Issues Final Rule on Energy Reserves in Release No. 33-8995
The SEC issued a final rule updating the disclosure requirements for oil and gas producers in Release No. 33-8995, Modernization of Oil and Gas Reporting, on December 31, 2008.
The rule becomes effective January 1, 2010.
Release No. 33-8995 amends the disclosure requirements in Regulation S-K, and Regulation S-X, and it adds Subpart 1200 to Regulation S-K to codify the revised disclosure requirements in Industry Guide 2, which is being phased out.
Under the rule, energy companies will be required to price their proved oil and gas reserves with "the unweighted arithmetic average of the first-day-of-the-month price for each month within the 12-month period prior to the end of the reporting period, unless prices are defined by contractual arrangements, excluding escalations based upon future conditions."
1/02/09 - Study on Mark-to-Market Accounting is Released
The SEC issued its congressionally mandated study on mark-to-market accounting, recommending that this area of guidance be improved and not suspended, on December 30, 2008.
The study recommended improvements to existing practice, including reconsidering the guidance for impairment tests and the development of additional guidance for determining the fair value of investments in inactive markets, including situations where market prices are not readily available.
Congress required the SEC to conduct the study when it approved the government's $700 billion bailout package in October in the Emergency Economic Stabilization Act of 2008.
The report said investors generally believe fair value accounting increases financial reporting transparency and facilitates better investment decision-making.
12/29/08 - Pension Bill May Ease Funding Requirements for Cash-Strapped Plan Sponsors
President Bush's signing of the Worker, Retiree and Employer Recovery Act of 2008 on December 23, 2008, hardly solves all the problems plan sponsors have with underfunded pensions, but it at least eases some of the obligations they have to make up the shortfalls in defined benefit plans that have suffered sharp losses in the financial meltdown.
The bill was approved by Congress earlier this month, and the wide support it garnered in both houses was taken as a sign of the unusual urgency lawmakers feel to ease up on cash-strapped companies.
The bill also happened to be passed just days before the final provisions of the FASB's SFAS No. 158, Employers' Accounting for Defined Benefit Pension and Other Postretirement Plans, became effective on December 15. The accounting guidance, which was issued in 2008, called for plan sponsors to measure assets and obligations on their year-end balance sheets. The law does not change the guidance in SFAS No. 158, but by providing some relief for single-employer and multi-employer pension plans puts a lid on the funding shortfalls companies will have to report in their 2008 financials.
12/24/08- Proposed Guidance in FSP No. EITF 99-20-a Would Standardize Calculation for Impairments
The issuance of the Proposed FASB Staff Position (FSP) No. EITF 99-20-a, Amendments to the Impairment and Interest Income Measurement Guidance of EITF Issue No. 99-20, on December 19, 2008, makes clear that the recognition of an impairment to financial instruments has become the focal point in the debate over the role of fair value accounting in the credit crisis.
The issuance of the document under a fast-track due process is part of the FASB's response to marching orders given to it by the SEC and Congress.
The proposed amendment will resolve differences between the measurement of declines in market value under EITF No. 99-20, Recognition of Interest Income and Impairment on Purchased Beneficial Interests and Beneficial Interests That Continue to Be Held by a Transferor in Securitized Financial Assets, and SFAS No. 115, Accounting for Certain Investments in Debt and Equity Securities. Accounting practitioners campaigning for this change have argued that revising the impairment guidance will benefit the frozen credit markets.
12/22/08 -- FINRA Chief Mary Schapiro Named by Obama to Head SEC
President-elect Barack Obama nominated Mary Schapiro to serve as chairwoman of the SEC, replacing Christopher Cox.
Making the formal announcement during a December 18, 2008, press conference, Obama said the scandal surrounding Bernard Madoff, his investment firm, and the SEC's failure for a decade to follow up on tips about Madoff's activities reminded the public of the need for regulatory reform.
Schapiro has been chairman and CEO of the Financial Industry Regulatory Authority (FINRA) since 2006, and she has served in numerous financial regulatory roles in the past 20 years. She was briefly acting chair of the SEC prior to Arthur Levitt becoming chairman in 1993.
Schapiro was appointed to the SEC by President Ronald Reagan in 1988 and served as a commissioner for six years. In 1994, President Bill Clinton selected her to run the Commodity Futures Trading Commission (CFTC). She became president of NASD Regulation at the National Association of Securities Dealers in 1996. She became the NASD's vice chairman in 2002 and took her current post in 2006. The NASD was renamed FINRA in 2006 after being merged with the New York Stock Exchange's regulatory arm.
12/17/08 -- Cox Emphasizes Benefits of Fair Value Accounting, Independent Standard-Setting
With the SEC nearing completion of its congressionally mandated study of mark-to-market accounting, the agency's chairman said the final document is likely to reaffirm the role this area of guidance plays for investors and accounting practitioners.
"Most investors, and many others, agree that fair value is a meaningful and transparent measure of an investment for financial reporting purposes," said Christopher Cox during the AICPA's National Conference on Current SEC and PCAOB Developments in Washington on December 8, 2008. "Financial reporting is intended to meet the needs of investors. While financial reporting may serve as a starting point for other users, such as prudential regulators, the information content provided to investors should not be compromised to meet other needs."
The results of the study should be out by January 2, 2009, Cox said.
12/16/08 -- SEC to Discuss Final Rule on XBRL Disclosures
The SEC will meet on December 17, 2008, to discuss a series of rulemaking proposals, including the use of the eXtensible business reporting language, mutual fund disclosures with interactive data, and annuity contracts.
The five commissioners will also consider whether to adopt the PCAOB's 2009 budget.
In late May, the SEC issued a proposed rule on the adoption of XBRL for companies to file their financial reports. Release No. 33-8924, Interactive Data to Improve Financial Reporting, set out the schedule for large companies with a public float above $5 billion and that use U.S. GAAP to submit their financial statements tagged in XBRL as separate exhibits to their filings for their periods that end on or after December 15, 2008.
Other domestic and foreign filers that use U.S. GAAP would begin submitting these exhibits for reporting periods that begin after December 15, 2009. All other companies that follow U.S. GAAP and foreign issuers that use IFRS would submit their filings for periods beginning on or after December 15, 2010.
In June, the SEC issued proposed changes to the disclosure rules governing mutual funds in Release No. 33-8929, Interactive Data for Mutual Fund Risk/Return Summary. The SEC will consider whether to require fund companies to file information using XBRL. Rule amendments allowing investment companies to submit portfolio holding information voluntarily under XBRL will also be considered.
The SEC will also consider adopting amendments to the terms defining annuity contracts under the Securities Act of 1933, and whether to exempt insurers' annuity businesses from the periodic reporting requirements under the Securities Exchange Act of 1934.
12/11/08 -- SEC Chief Accountant Continues Push for IFRS, XBRL
Clear and straightforward financial reporting provides investors with the best information, and that is the best argument for the U.S. adoption of IFRS, said Conrad Hewitt, the SEC's chief accountant.
Hewitt, who is one of several senior agency officials who is planning on leaving the agency within the next month or two, gave his assessment of IFRS and some other key SEC initiatives, including interactive data and the agency's pending study on fair value accounting, during the AICPA's National Conference on Current SEC and PCAOB Developments in Washington on December 8, 2008.
Hewitt said he fully embraced the concept of one set of rules and applauded the SEC for voting to propose for public comment a proposed roadmap for the potential adoption of IFRS in August. The rule proposal was issued in November in Release No. 33-8982, Roadmap for the Potential Use of Financial Statements Prepared in Accordance with International Financial Reporting Standards by U.S. Issuers.
In regard to the eXtensible Business Reporting Language (XBRL), Hewitt said he believed that interactive data "will transform how investors access information in a very easy to use format. I hope very soon the Commission will have the vote adopting the release for XBRL." Hewittt added that he has reviewed the first draft of the Commission's congressionally-mandated study on mark-to-market accounting and is "very pleased" with the study so far.
12/10/08 -- SEC Issues Release No. 34-59062 to Improve Disclosures in Municipal Bond Market
The SEC issued Release No. 34-59062, Amendment to Municipal Securities Disclosure, on December 5, 2008.

The final rule amends some of the requirements regarding the information that the broker-dealers and underwriters have to get from issuers in floating a municipal bond offering.
The rule becomes effective July 1, 2009.
Brokers and underwriters have to determine that the issuer, or the issuer's representative, has agreed to provide the information covered by the written agreement to the Municipal Securities Rulemaking Board, instead of to multiple nationally recognized municipal securities information repositories and state information depositories. The information also has to be provided electronically under MSRB guidelines.
12/09/08 -- In Release No. 34-59036, SEC Grants Accelerated Approval for Options Clearing Corporation Rule
On December 1, 2008, the SEC granted accelerated approval of a proposed rule change to the Options Clearing Corporation's stock loan and hedge program.
Release No. 34-59036, Self-Regulatory Organizations; The Options Clearing Corporation; Order Granting Accelerated Approval of a Proposed Rule Change Relating to the Stock Loan/Hedge Program, approves three rule changes to the program under Section 19(b)(1) of the Securities Exchange Act of 1934:

Rule 601(e) eliminates its current category of margin-ineligible accounts and instead will apply its standard margining approach to all program positions using its STANS system. In addition, a new interpretation .06 will be added to Rule 601 setting forth the additional margin charges and credits and the implementation schedule applicable to stock loan and borrow positions that have collateral set at 102%;
Rule 2201(a) will now state that with respect to standing instructions that clearing members provide to OCC, the requirement to notify OCC of the fact that the clearing member is approved to maintain stock loan positions and stock borrow positions in its accounts on a non-margined basis and the account or accounts that are to be margin-ineligible shall become inapplicable in three months. After that time, OCC will have eliminated the ability to carry any stock loan or borrow positions on a margin-ineligible basis; and
Rule 2202(f) is being amended to specify that in one month a member shall not be able to submit new stock loan transactions to the OCC for clearance in a margin-ineligible account.

12/04/08 -- SEC Warns Brokerage and Fund Management Officials to Not Stint on Compliance Programs
Lori Richards, the SEC's compliance director, sent an open letter to SEC-registered companies on December 2, 2008, to remind them that as they consider ways to cut costs, they should remember the critical role played by compliance programs in meeting obligations under the securities laws.
"Firms must be vigilant and proactive in preventing, detecting and correcting problems that could occur," Richards wrote. "Firms should pay attention to ensuring that their interactions with investors meet high standards, that sales and trading practices are appropriate, that financial, valuation and risk controls are followed, and that all disclosure obligations are met-as well as meeting all other obligations in conformity with the securities laws."
According to the SEC, the letter is for the 11,300 investment advisers, 950 mutual fund complexes, 5,600 broker-dealers, and 410 transfer agents registered with the SEC and subject to compliance obligations under the federal securities laws.
In the letter, Richards said compliance programs:

Assure that a company's operations comply with the law and industry participation rules;
Protect the interests of a company's customers, clients and shareholders; and
Protect a company from conduct that could negatively impact its business and reputation.

12/02/08 -- Nasdaq Proposal in SEC Release No. 34-59014 Would Require Partnerships to Get Shareholder Approval Before Issuing Stock Options
The Nasdaq OMX Group Inc. proposed a rule amendment that would require limited partnerships to seek shareholder approval before issuing stock options as compensation to employees, officers, directors, or consultants in a rule proposal filed with the SEC on November 25, 2008.
Release No. 34-59014, Notice of filing of a Proposed rule Change to Require Limited Partnerships to Obtain Shareholder Approval for the Use of Equity Compensation and make Other Clarifying Changes to the Listing Requirements for Limited Partnerships, would add the requirement for shareholder approval when a stock option or purchase plan is to be established or amended.
When Nasdaq amended its listing requirements following the passage of the Sarbanes-Oxley Act of 2002, it inadvertently exempted partnerships, the SEC said. The recent controversy over executive compensation and shareholder pressure to improve corporate governance measures led Nasdaq to propose the change.
12/01/08 -- SEC Staff Issues Guidance For Proxy Statements Under the TARP
The SEC issued staff guidance for financial institutions filing proxy statements for securities purchases under the government's financial bailout package, known as the Troubled Asset Relief Program.
Under the Treasury Department's Capital Purchase Program, announced in October, financial institutions seeking to issue securities may be required to solicit and obtain shareholder approval for the authorization of the securities. To solicit shareholder approval, a financial institution must comply with the federal securities laws and any applicable state laws. The federal securities laws require certain financial institutions to file a proxy statement on Schedule 14A when soliciting shareholder approval.
Because the Treasury Department is injecting capital directly into banks through the purchase of preferred shares, companies without preferred stock plans in place have to get shareholder approval before they get aid.
11/25/08 -- In Release No. IC-28487, the SEC Provides Exemption for Money Funds Getting Treasury Backing
The SEC adopted an interim final temporary rule on November 20, 2008, to provide money market funds participating in the Treasury Department's $50 billion temporary guaranty program relief from certain provisions under the Investment Company Act of 1940.
In Release No. IC-28487, Temporary Exemption for Liquidation of Certain Money Market Funds, the SEC is adopting Rule 22e-3T to provide an exemption that allows funds taking part in the guaranty program to temporarily suspend redemptions of their outstanding shares and postpone the payment of redemption proceeds. The exemption includes a procedure for liquidating money funds in certain circumstances.
Comments on the proposal are due 30 days after publication in the Federal Register, which usually occurs a few days after its publication on the SEC's website. The rule is effective until October 18, 2009.
11/20/08 -- In Release No. 34-58911, SEC Approves Nasdaq Proposal for Late Filers
On November 6, 2008, the SEC approved a Nasdaq proposal to modify the procedures for listed companies that are late in filing a required periodic report with the SEC.
Release No. 34-58911, Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change to Modify the Procedures Applicable to Listed Companies that Are Late in Filing a Required Periodic Report with the Commission, is effective immediately under Section 19(b)(3)(A) of the Securities Exchange Act of 1934.
Comments on the proposal are due December 9.
11/19/08 -- SEC Issued IFRS Roadmap in Release No. 33-8982
The SEC issued the long-awaited proposal to pave the way for U.S. companies to use global accounting rules in Release No. 33-8982, Roadmap for the Potential Use of Financial Statements Prepared in Accordance with International Financial Reporting Standards by U.S. Issuers, on November 14, 2008.
The proposed rule provides a timeline for U.S. companies to adopt IFRS in a phased-in approach from 2010 through 2017, provided several conditions are met each stage along the away. Large companies approved to be in the first wave of adopters can use the rules for the regulatory filings they submit in 2010 for their 2009 fiscal years. Only companies that are among the largest global entities in industries where IFRS are followed by more firms than any other set of accounting principles would be eligible to become early users. The proposal's 90-day comment period ends on February 19, 2009.
11/17/08 -- SEC to Consider Proposals on Rating Agencies and Fund Disclosures
The SEC plans to have an open meeting on November 19, 2008, to consider two regulatory and administrative proposals.
The proposals include rule amendments that would:

Impose additional requirements on nationally recognized statistical rating organizations (NRSROs) to address concerns about the integrity of their credit rating procedures and methodologies; and
Improve mutual fund disclosure by providing investors with a summary prospectus containing key information in plain English in a clear and concise format, and by enhancing the availability on the Internet of more detailed information to investors. The SEC will also consider adopting related amendments to Form N 1A, including amendments that address exchange-traded funds (ETFs).

The proposed amendments are detailed in a series of releases the SEC issued during the summer.
11/12/08 -- SLB No. 14D Clarifies Right to Reject Proposals on Corporate Charters
The SEC's division of corporation finance said there is "some basis" for companies to omit shareholder proposals to amend a company's charter under Rule 14a-8 of the Securities Exchange Act of 1934.
In Staff Legal Bulletin (SLB) No. 14D, issued on November 7, 2008, the SEC said the omission would be allowed "if the company meets its burden of establishing that applicable state law requires any such amendment to be initiated by the board and then approved by shareholders in order for the charter to be amended."
11/06/08 -- SEC and FASB Say Warrants in Bailout Package May Be Treated as Equity
The SEC and the FASB told the Treasury Department that warrants issued under the government's plan to buy troubled assets from financial institutions may be treated as permanent equity under U.S. GAAP.
The standard-setters outlined their opinion in a joint letter to David Nason, Treasury's assistant secretary for financial institutions in an October 24, 2008, letter.
"We would not object if the warrants…were to be classified as permanent equity under applicable U.S. GAAP, provided that the issuer of such warrants has sufficient authorized but unissued shares of the class of stock that may be required upon settlement and any other necessary shareholder approvals have been obtained," wrote James Kroeker, deputy chief accountant for the SEC and Russell Golden, technical director for the FASB.
11/03/08 -- With SEC Release No. 33-8981, Electronic Filings Are Now Mandatory Under the Investment Company Act
The SEC issued a final rule on October 29, 2008, requiring all applications for exemptions under the Investment Company Act of 1940 to be made electronically. The rule in Release No. 33-8981, Mandatory Electronic Submission of Applications for Orders under the Investment company Act and Filing Made Pursuant to Regulation E, will become effective January 1, 2009.
Under Chairman Christopher Cox, who has indicated he will leave the agency in 2009, the regulatory agency has approved a number of rules to increase the electronic filing of forms and disclosures on the SEC's EDGAR system.
The final rule amends certain provisions of Regulation S-T and Investment Company Act Rule 0-2 to require electronic submission on EDGAR. Rule 0-2 requires every application for an exemption that does not have a specific form to contain a statement from the company that all requirements have been met and the person signing the application is fully authorized. Regulation E allows for the exemption from registration of securities issued by small business investment companies registered under the Investment Company Act.
The goal of the rule change is to increase the speed of delivery of financial and business information to investors, the SEC said.
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FASB

1/09/09 -- FASB's Impairment Proposal Is Approved Amid Sharp Debate
A bitterly divided FASB voted three-to-two on January 7, 2009, to approve a proposal to amend the guidance for recognizing impairments to financial instruments.
The approval of Proposed FASB Staff Position (FSP) No. EITF 99-20-a, Amendments to the Impairment and Interest Income Measurement Guidance of EITF Issue No. 99-20, which was issued less than three weeks prior to the Board's decision to move it to final guidance, came amid what one meeting participant characterized as a "religious war" among the FASB members.
The guidance gives statement preparers, particularly those at financial institutions holding assets that can only be sold at steep discounts to their purchase price, more freedom in deciding whether to record the decline in market values as other-than-temporary impairments. It is widely expected that the financial companies will take the opportunity to mark the troubled assets at their amortized historical cost and avoid writing them down to their fair market values.
Three Board members, Chairman Robert Herz, Leslie Seidman, and Lawrence Smith voted in support of the proposal. The dissenting votes came from Thomas Linsmeier and Marc Siegel, who said they will prepare a formal dissent to be included in the final guidance document.
01/08/09-Comment Deadlines for Some FASB Proposals

The comment periods on FASB proposals to amend various accounting standards are scheduled to expire in the next few months.

Proposed FASB Staff Position (FSP) No. FAS 107-a, Disclosures about Certain Financial Assets: An Amendment of FASB Statement No. 107, would improve the disclosures for debt instruments classified as available for sale or held to maturity and loans and long-term receivables that are not being marked at fair value. Comments are due by January 15, 2009.
Proposed FSP No. FAS 141(R)-a, Accounting for Assets Acquired and Liabilities Assumed in a Business Combination That Arise from Contingencies, would amend the accounting for assets and liabilities arising from contingencies in a business combination under SFAS No. 141(R), Business Combinations. The comment period ends January 15.
Proposed FSP No. FAS 144-d, Amending the Criteria for Reporting a Discontinued Operation, would amend SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets, to change the definition of a discontinued operation and require additional disclosures concerning components of an entity that have been disposed of or classified as held for sale during the current period. Comments are due by January 23.
Draft Abstract of Emerging Issues Task Force (EITF) Issue No. 08-1, Revenue Arrangements with Multiple Deliverables, addresses how to determine whether an arrangement involving multiple deliverables contains more than one unit of accounting and how to allocate the arrangement consideration among the separate units of accounting. The document is open for comment until January 30.
Discussion Paper PV No. 1630-100, Preliminary Views on Financial Statement Presentation, was jointly issued with the IASB. The draft analyzes current issues in financial statement presentation and the plans by the standard-setters to address the issues. Comments are due April 14.

1/07/09 -- FASB Amended Pension Disclosure Requirements in Final FSP No. FAS 132(R)-1
The FASB's Final FASB Staff Position (FSP) No. FAS 132(R)-1, Employers' Disclosures about Postretirement Benefit Plan Assets, will make employers provide more transparency about the assets held by retirement plan and the concentrations of risk in those plans.
The guidance, which was released on December 30, 2008, establishes a range of additional disclosures designed to give more specific information about pension plans.
The required disclosures were issued in response to users' concerns about the lack of transparency surrounding the types of assets and associated risks in pension plans, especially in light of the economic crisis. Because pension plan accounting allows for some estimates in order to smooth returns, the disclosures have been perceived as all the more important. For this reason, the Board expanded the scope of the project beyond what it had originally planned and added the requirement to disclose information about fair value measurements of plan assets that would be similar to the disclosures about fair value measurements required by SFAS No. 157, Fair Value Measurements.
01/05/09--Pension Disclosure Requirements Are Amended In Final FSP No. FAS 132(R)-1
The FASB's Final FASB Staff Position (FSP) No. FAS 132(R)-1, Employers' Disclosures about Postretirement Benefit Plan Assets, will require employers to provide more transparency about the assets held by retirement plan and the concentrations of risk in those plans.
The guidance, which was released on December 30, 2008, establishes a range of additional disclosures designed to give more specific information about pension plans.
The required disclosures were issued in response to users' concerns about the lack of transparency surrounding the types of assets and associated risks in pension plans, especially in light of the economic crisis. Because pension plan accounting allows for some estimates in order to smooth returns, the disclosures have been perceived as all the more important. For this reason, the Board expanded the scope of the project beyond what it had originally planned and added the requirement to disclose information about fair value measurements of plan assets that would be similar to the disclosures about fair value measurements required by SFAS No. 157, Fair Value Measurements.
12/31/08 - Final Guidance Issued in 2008 Focused on Fair Value, Off-Balance-Sheet Activity
For the FASB, the bleak news from the financial sector and the response to the credit crisis dictated much of the standard-setting activity during 2008. A large part of the guidance issued in the past 12 months addressed topics such as fair value, hedge accounting, and off-balance-sheet activity.
Three FASB Staff Positions (FSP) related to fair value measurements:

FSP No. FAS No. 157-1, Application of FASB Statement No. 157 to FASB Statement No. 13 and Other Accounting Pronouncements That Address Fair Value Measurements for Purposes of Lease Classification or Measurement under Statement 13, amended SFAS No. 157, Fair Value Measurements, to exclude SFAS No. 13, Accounting for Leases, and other accounting pronouncements that address fair value measurements for purposes of lease classification or measurement under SFAS No. 13;
FSP No. FAS 157-2, Effective Date of FASB Statement No. 157, delayed the effective date of SFAS No. 157 for nonfinancial assets and nonfinancial liabilities, except for items that are recognized or disclosed at fair value in the financial statements on a recurring basis; and
FSP No. FAS 157-3, Determining the Fair Value of a Financial Asset When the Market for That Asset Is Not Active, clarified the application of SFAS No. 157 in a market that is not active and provided an example to illustrate the key considerations in determining the fair value of a financial asset when there is no longer an open market to trade it in.

12/30/08 - FASB Continues Planned Reform of Financial Instrument Guidance

The FASB issued Proposed FASB Staff Position (FSP) No. 107-a, Disclosures about Certain Financial Assets: An Amendment of FASB Statement No. 107, on December 24, 2008.
With the issuance of the draft guidance, the FASB is taking another step in its response to the global financial crisis. (See Proposed Guidance in FSP No. EITF 99-20-a Would Standardize Calculation for Impairments in the December 23, 2008, edition of Accounting & Compliance Alert.)
In Proposed FSP No. 107-a, the FASB is asking companies to improve the disclosures for debt instruments classified as available for sale or held to maturity and loans and long-term receivables that are not being marked at fair value. Reporting entities would be required to use a table to compare measurement attributes for the debt, loans, and receivables. The three columns in the table would show the assets as they are reported on the balance sheet, recorded at fair value, and the carrying amount under an incurred loss model.
12/23/08- FASB Opts for Stricter Guidance on Off-Balance-Sheet Activities

The FASB decided to keep with its ambitious schedule for amending off-balance-sheet accounting, resisting pressure from constituents seeking to delay the stricter rules, when it met for its weekly meeting on December 17, 2008, at its Norwalk, CT headquarters.
The Board plans to move forward with its short-term project that will amend SFAS No. 140, Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities. The proposed guidance, Exposure Draft (ED) No. 1610-100, Accounting for Transfers of Financial Assets: An Amendment of FASB Statement No.140, will remove special accounting treatment for qualified special purpose entities (QSPE) and provide additional requirements for financial institutions seeking sale accounting for the transfer of assets.
ED No. 1610-100 proposes that the amended rules be effective for fiscal years starting after November 15, 2009.
12/18/08-Proposed FSP No. FAS 141(R)-a Would Amend Subsequent Measurement of Contingencies Acquired in a Business Combination

The FASB issued Proposed FASB Staff Position (FSP) No. FAS 141(R)-a, Accounting for Assets Acquired and Liabilities Assumed in a Business Combination That Arise from Contingencies, on December 15, 2008.
If approved, the proposed guidance would amend the accounting for assets and liabilities arising from contingencies in a business combination under SFAS No. 141(R), Business Combinations. The comment period ends January 15, 2009.
If the proposal becomes final guidance, it would be effective for business combinations that close on or after the start of the first fiscal year that began on or after December 15, 2008.
FSP No. FAS 141(R)-a was issued to address the concerns accounting practitioners and lawyers expressed about the initial recognition and subsequent measurement provisions of SFAS No. 141(R), the FASB said. The proposal would require the use of the fair value hierarchy in SFAS No. 157, Fair Value Measurements, for the acquired assets and assumed liabilities that arise from contingencies in a business combination.
12/15/08- Credit Crisis and Accounting for Financial Assets Will Be Addressed in Upcoming Board Meetings

The FASB will have a busy prelude to the holiday season, based on its agenda for the week of December 15, 2008.
The Board will hold a special meeting on December 15 to discuss accounting for financial instruments during the credit crisis and the input it has received on financial reporting issues arising from the global credit crisis. The input came from recent roundtable discussions and numerous unsolicited comment letters. The Board will consider various projects to address issues identified by constituents.
On December 17, the Board plans to discuss issues raised by respondents to Exposure Draft (ED) No. 1610-100, Accounting for Transfers of Financial Assets, and determine which of those issues it should further discuss during redeliberations.
The Board will also discuss issues raised by respondents to ED No. 1620-100, Amendments to FASB Interpretation No. 46(R), and determine which of the issues it should discuss as it reviews the proposed guidance.
The Board will discuss comments received on proposed FASB Staff Position (FSP) No. FIN 48-c, Effective Date of FASB Interpretation No. 48 for Certain Nonpublic Enterprises, and whether to issue that FSP as final.
The credit crisis and loss contingency disclosures are also on the agenda of a December 15 meeting of the Financial Accounting Standards Advisory Council, which advises the FASB on its standard-setting agenda. The panel will also discuss lease accounting and hear reports from Herz and SEC and PCAOB officials.
12/08/08 -- FASB Will Launch its Accounting Standards Codification in July 2009
The FASB said December 4, 2008, that the Accounting Standards Codification will go live July 1, 2009, replacing all U.S. GAAP from the FASB, the AICPA, the Emerging Issues Task Force (EITF), and other sources.
After that date, the Codification will be the only source of authoritative GAAP. All other accounting literature will be considered non-authoritative guidance.
"U.S. GAAP will be completely reconfigured in a way that will vastly improve the ease of researching U.S. GAAP issues," said FASB Chairman Robert Herz in a statement. "Preparers and auditors of financial statements need to familiarize themselves with the changes so that they are ready for the switch."
The Codification reorganizes thousands of U.S. GAAP pronouncements into roughly 90 topics and displays them in a consistent structure. The structure also includes SEC accounting guidance in a separate section.
12/03/08 -- FASB Approves EITF Guidance and Proposals
During its November 24, 2008, meeting, the FASB endorsed five decisions the Emerging Issues Task Force reached two weeks earlier on five issues.
Three of the EITF issues ratified by the Board were task force consensuses:

Issue No. 08-6, Equity Method Investment Accounting Considerations,
Issue No. 08-7, Accounting for Defensive Intangible Assets, and
Issue No. 08-8, Accounting for an Instrument (or an Embedded Feature) with a Settlement Amount That Is Based on the Stock of an Entity's Consolidated Subsidiary.

All three issues had been released as exposure documents by the EITF in September and approved as consensuses EITF on November 13. The latest decision elevates them to final guidance.
The Board also ratified two EITF consensuses-for-exposure:

Issue No. 08-1, Revenue Arrangements with Multiple Deliverables, and
Issue No. 08-10, Selected Statement 160 Implementation Questions.

11/26/08 -- FASB Says Entities with Interests in SPEs Will Have to Reveal Maximum Loss Exposures
The FASB approved a recommendation from its research staff that loan originators and servicers with stakes in special purpose entities disclose their maximum exposures to potential losses in the off-balance-sheet vehicles.
With the decision, which was reached by the Board during a November 24, 2008, meeting, the FASB is ready to proceed with publication of the final version of the Proposed FASB Staff Position (FSP) No. FAS 140-e and (FIN) 46(R)-e, Disclosures about Transfers of Financial Assets and Interests in Variable Interest Entities.
The FASB also reiterated the approval of its earlier decisions that final FSP No. FAS 140-4 and FIN 46(R)-8 will be effective for the first interim and annual reporting periods that begin after it is issued.
11/24/08 -- FASB Will Reconsider Inclusion of Lessor Accounting In Lease Accounting Project
The FASB's November 19, 2008, meeting dealt with one of the major stumbling blocks in the convergence project with the IASB, lease accounting, and the outcome suggested that the standard-setter is still far from a clear resolution to this troublesome area.
Board members held a lengthy debate on some of the fundamentals of lease accounting, and struggled to come up with a clear set of instructions for the FASB team that was supposed to make a presentation to the IASB's November 20 meeting in London.
The FASB and the IASB have targeted a significant revision of lease accounting and convergence of their standards in this area as a major milestone in the convergence of U.S. GAAP with IFRS. The Discussion Paper being developed by FASB is one of the initial steps toward identifying what the revisions may include and is scheduled to be issued for comment in February 2009.
11/18/08 -- FASB Plans to Discuss Measurement of Lease Obligations
The FASB plans to discuss its projects on lease accounting and financial instruments with characteristics of equity at its November 19, 2008, weekly meeting in Norwalk, CT.
The Board will review the initial and subsequent measurement of a lease obligation and right-of-use asset and the presentation of a lease in financial statements. The Board also will discuss the accounting for subleases.
The Board will also continue to develop an approach to identify equity instruments, as part of its project on financial instruments with characteristics of equity, for which it released Preliminary Views (PV) No. 1550-100, Financial Instruments with Characteristics of Equity. Finally, the Board will discuss whether perpetual basic ownership instruments, other perpetual instruments, and derivatives on an issuer's basic ownership instruments should be classified as equity.
11/14/08 -- FASB Resolves Many Outstanding Issues on Guidance on Disclosures of Transferred Financial Assets
The FASB Board discussed public comments on its project to require additional disclosures for off-balance-sheet transactions, giving its staff approval to draft the final version, when the Board met for its weekly meeting on November 12, 2008, at its Norwalk, CT headquarters.
The Board authorized its research staff to incorporate certain modifications to FASB Staff Proposal (FSP) No. FAS 140-e and FIN 46(R)-e, Disclosures about Transfers of Financial Assets and Interests in Variable Interest Entities. The staff estimated that these changes could be made and brought to the Board the final week of November. They anticipated that the guidance will be issued on December 15, 2008.
The FASB staff had tried to integrate some of the public feedback into the recommended changes they proposed to the Board, some of which were approved, while others were met with skepticism.
11/13/08 -- IASB and FASB Announce Plans for Second and Third Global Financial Crisis Roundtables
On November 6, 2008, the IASB and the FASB announced the dates for the remaining two public roundtable discussions to identify financial reporting issues highlighted by the global financial crisis.
The second roundtable will be held in Norwalk on November 25, and the third will be held in Tokyo on December 3. The first roundtable, which was announced on November 3, is to be held in London on November 14.
The roundtables are being held to give the Boards an opportunity to ask financial statement users, preparers, government officials and regulators, and others about the market meltdown and the things that need to be done to improve financial reporting and restore investor confidence.
11/11/08 -- Action Alert 08-45: FASB Will Discuss Disclosures for Transfers of Financial Assets
At its weekly meeting on November 12, 2008, the FASB will redeliberate the proposed guidance on disclosures about transfers of financial assets and interests in variable interest entities. According to Action Alert 08-45, the FASB will discuss the proposed FASB Staff Position (FSP) No. FAS 140-e and FIN 46(R)-e, Disclosures about Transfers of Financial Assets and Interests in Variable Interest Entities. The FSP is being issued to improve disclosures for users of financial information until the amendments to SFAS No. 140, Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities, and FASB Interpretation (FIN) No. 46 (revised December 2003), Consolidation of Variable Interest Entities, are effective. The Board will also discuss the disclosures, effective date, and transition provisions for the final guidance on mergers and acquisitions of not-for-profit organizations and goodwill and other intangible assets. The Board also will consider whether to proceed toward drafting a single final statement or separate statements. The Board will also hold an educational session to discuss topics that it expects to come up at a future meeting.
11/10/08 -- Financial Statement Users Suggest Changes to FASB's Consolidation Rules
A group of auditors, bankers, financial analysts and government officials met with the FASB Board at a special roundtable session on November 6, 2008, and discussed their views on proposed amendments to Exposure Draft (ED) No. 1610-100, Accounting for Transfers of Financial Assets: An Amendment of FASB Statement No. 140, and ED No. 1620-100, Reconsideration of FIN 46(R): Consolidation of Variable Interest Entities.
Both proposals are open for comment until November 14.
In letters to the FASB, some constituents had argued that if there is any continuing involvement with a securitized asset, sale accounting should not be permitted. Continuing involvement is defined as any involvement with the sold financial assets that still allows the seller to receive a cash flow, such as a mortgage payment, from the assets.
In the November 6 discussion, participants provided the Board with their opinions on the continuing involvement, often disagreeing with each other on the implications of the new guidance or how it would impact users' understanding of securitized assets and the financial statements.
11/07/08 -- In Proposed FSP No. FIN 48-c, the FASB Seeks a Partial Delay for Compliance with FIN No. 48
The FASB issued Proposed FASB Staff Position (FSP) No. FIN 48-c, Effective Date of FASB Interpretation No. 48 for Certain Nonpublic Enterprises, on November 4, 2008.
In the proposal, the FASB is seeking to defer the effective date for FASB Interpretation (FIN) No. 48, Accounting for Uncertainty in Income Taxes, for private entities to fiscal years beginning after December 15, 2008.
The comment period on the proposal ends on December 3.
The FSP uses the definition of non-public companies that appears in paragraph 289 of SFAS No. 109, Accounting for Income Taxes, which includes nonpublic not-for-profit organizations.
11/05/08 -- Action Alert 08-44: Board Plans to Review Measurement of Assets and Liabilities Under Conceptual Framework
At its weekly meeting on November 5, 2008, the FASB will continue its discussion of the methods for measuring different types of assets and liabilities in the conceptual framework.
According to Action Alert 08-44, the Board will discuss the factors that should be considered in making decisions about appropriate measurement bases, such as exit price or entry price, for different types of assets and liabilities.
On November 6, the Board plans to hold an open roundtable discussion on the proposed statements in Exposure Draft (ED) No. 1610-100, Accounting for Transfers of Financial Assets, and ED No. 1620-100, Amendments to FASB Interpretation No. 46(R). The proposals are open for comment until November 14.
11/04/08 -- Accounting for Business Combination Contingencies Swiftly Moving Forward
The FASB considered amendments to clarify how assets and liabilities arising from contingencies in a business combination should be accounted for at its weekly Board meeting on October 29, 2008.
The Board approved the scope for its recently added project on accounting for assets and liabilities arising from contingencies in a business combination, which would amend SFAS 141(R), Business Combinations. The scope will include loss contingencies, such as pending litigation, possible claims and assessments, obligations related to product warranties and product defects and other related items. Board members also discussed both the initial measurement and recognition of pre-acquisition contingencies and their subsequent measurement.
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AICPA

9/04/08 -- AICPA's Proposed Amendment of AU Section 722 Would Cover Private Company Interim Statements
The Auditing Standards Board (ASB), the senior technical committee of the American Institute of Certified Public Accountants (AICPA) designated for issuing auditing, attestation, and quality control standards and guidance, issued an exposure draft on September 2, 2008, that would amend AU Section 722, "Interim Financial Information."
Comments on the proposal are due by November 3.
The proposed Statement on Auditing Standards (SAS) would amend AU Section 722 to accommodate reviews of interim financial information of nonissuers, including companies offering securities in private offerings under Rule 144A of the Securities Act of 1933 or participating in private equity exchanges.
The proposed guidance would apply when the interim financial information is intended to provide a periodic update to year-end reporting and the accountant either:

Has audited the entity's latest annual financial statement, or
Is auditing the current year financial statements and the entity's latest annual financial statements were audited by another auditor.

In addition, the amendment would remove the guidance for reviews of the interim financial statements of issuers in AU Section 722 because the guidance resides in the auditing standards of the Public Company Accounting Oversight Board (PCAOB).
The proposed SAS would be effective for interim periods within fiscal years beginning after December 15, 2008. Early application would be permitted.
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PCAOB

10/13/08 -- PCAOB Schedules Meeting of Standing Advisory Group
The PCAOB's Standing Advisory Group will meet on October 22- 23, 2008, in Washington.
The SAG will discuss audit considerations relating to the current economic environment; the PCAOB's standard-setting priorities, which will include a report on the standards-related accomplishments during the past year; and two recommendations included in the final report from the Treasury Department's Advisory Committee on the Auditing Profession (ACAP).
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GASB

3/4/08 -- GASAC to Receive an Update on the Board's Derivative Instruments Project.
The Governmental Accounting Standards Advisory Council, which advises the Governmental Accounting Standards Board, will meet on March 6-7, 2008, to take up:

A report on the meetings and activities of the Financial Accounting Foundation (FAF), and a report from the GASB Chairman;
Comments from other Board members, including an update on the Board's derivative instruments project; and
GASAC feedback on technical agenda topics, communications and public relations topics, project prospectuses and proposals, and project priorities.

The meeting will take place at the GASB office in Norwalk, Connecticut, and be open to the public.
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IASB

10/21/08 -- IASB and FASB Publish Discussion Paper on Proposed Enhancements to Financial Statement Presentation
The FASB and the IASB published for comment a joint Discussion Paper (DP), PV No. 1630-100, Preliminary Views on Financial Statement Presentation, on October 16, 2008, that contains an analysis of the current issues in financial statement presentation and the Boards' initial plans to tackle those issues.
Comments about the paper are due by April 14, 2009.
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