We are pleased to release MaloneBailey's June 2018 issue of The Crunch, our newsletter highlighting recent accounting, regulatory and tax updates. Please note that the updates provided in this newsletter are not a comprehensive list.
We encourage you to visit the SEC, FASB and IRS websites for more information as well as a complete list of updated rules, regulations and proposals.
We invite you to contact us should you have any questions about the information provided in this issue.
We invite you to visit our website to review archived versions of this newsletter containing past accounting, regulatory and tax updates.
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What's the Crunch?
Featured Podcast
Accounting and Regulatory Updates
Recent FASB Updates & Proposals
Recent SEC Updates & Proposals
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Summary -
The FASB has issued Accounting Standards Update (ASU) No. 2018-06, Codification Improvements to Topic 942, Financial Services-Depository and Lending. ASU 2018-06 removes outdated guidance related to the Office of the Comptroller of the Currency's Banking Circular 202, Accounting for Net Deferred Tax Charges (Circular 202) in Subtopic 942-740, Financial Services-Depository and Lending-Income Taxes and should have no effect on reporting entities.
The amendments in ASU 2018-06 are effective immediately.
For more information, click here.
© 2018 CCH Incorporated and/or its affiliates. All rights reserved. Used with permission.
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Summary
- The FASB has released a proposed Accounting Standard Update (ASU), Collaborative Arrangement (Topic 808): Targeted Improvements.
The amendments in this proposed ASU would affect all entities that have collaborative arrangements. If adopted as proposed, this proposal would make targeted improvements to generally accepted accounting principles (GAAP) for collaborative arrangements as follows:
- Add unit-of-account guidance in Topic 808 to align with the guidance in Topic 606, Revenue from Contracts with Customers, (i.e., a distinct good or service) limited to when an entity is assessing the scope of Topic 606;
- Clarify that certain transactions between collaborative participants should be accounted for as revenue under Topic 606 when the collaborative participant is a customer in the context of the unit of account. In these situations, all of the guidance in Topic 606 should be applied, including recognition, measurement, presentation, and disclosure requirements; and
- Clarify that in a transaction that is not directly related to sales to third parties, presenting the transaction as revenue would be precluded if the collaborative participant counterparty is not a customer.
For more information, click here.
© 2018 CCH Incorporated and/or its affiliates. All rights reserved. Used with permission.
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FASB Discusses Business Combinations and Asset Purchases
Summary
- As reported in its "Summary of Board Decisions" publication, the FASB met on May 9, 2018, and discussed how certain areas within the accounting for asset acquisitions and business combinations could be aligned, specifically contingent consideration, in-process research and development, and acquisition costs. No technical decisions were made.
For more information, click here.
© 2018 CCH Incorporated and/or its affiliates. All rights reserved. Used with permission.
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FASB Discusses Disclosure Framework and Other Issues
Summary
- As reported in its "Summary of Board Decisions" publication, the FASB met on May 2, 2018, and discussed board member views on the draft of FASB Concepts Statement No. 8, Conceptual Framework for Financial Reporting-Chapter 8, Notes to Financial Statements. The Board indicated support for the draft.
The FASB also discussed revenue recognition of grants and contracts by not-for-profit entities. The FASB discussed the substantive external review and board member comments received on a draft of the final Accounting Standards Update, Not-for-Profit Entities (Topic 958): Clarifying the Scope and the Accounting Guidance for Contributions Received and Contributions Made, and agreed with the staff's analysis and approach for addressing those comments.
For more information, click here.
© 2018 CCH Incorporated and/or its affiliates. All rights reserved. Used with permission.
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WIN A GIFT CARD TO STARBUCKS
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Click here to enter contest.
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Summary
- The SEC has issued a final rule, Amendments to Forms and Schedules to Remove Provision of Certain Personally Identifiable Information. This final rule includes revisions to forms filed under the Securities Exchange Act of 1934 to eliminate the portion of those forms that requests filers to furnish certain personally identifiable information, including Social Security numbers. Commission forms amended by this final rule include:
- Form Funding Portal;
- Form MA;
- Form MA-I; and
- Form MSD.
The final rule is effective upon publication in the Federal Register.
For more information, click here.
© 2018 CCH Incorporated and/or its affiliates. All rights reserved. Used with permission.
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Summary
- The SEC has issued for public comment a proposed rule, Auditor Independence with Respect to Certain Loans or Debtor-Creditor Relationships. If adopted as proposed, this proposal would amend the SEC's auditor independence rules to refocus the analysis that must be conducted to determine whether an auditor is independent when the auditor has a lending relationship with certain shareholders of an audit client at any time during an audit or professional engagement period. The proposed amendments would:
- Focus the analysis solely on beneficial ownership rather than on both record and beneficial ownership;
- Replace the existing 10 percent bright-line shareholder ownership test with a "significant influence" test;
- Add a "known through reasonable inquiry" standard with respect to identifying beneficial owners of the audit client's equity securities; and
- Amend the definition of "audit client" for a fund under audit to exclude funds that otherwise would be considered affiliates of the audit client.
The proposal also includes a general request for comment on other potential amendments to its auditor independence rules.
Comments on the proposal are due 60 days after publication in the Federal Register.
For more information, click here.
© 2018 CCH Incorporated and/or its affiliates. All rights reserved. Used with permission.
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Summary
- CCH Incorporated has published a new edition of the GAAP Update Service. This new edition discusses the SEC's interpretive guidance to assist public companies prepare disclosures about their cybersecurity risks and incidents. The views of the Commission included in this interpretive release reinforce and expand on guidance from the SEC staff published in 2011.
For more information, click here.
© 2018 CCH Incorporated and/or its affiliates. All rights reserved. Used with permission.
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Summary
- Wolters Kluwer Tax & Accounting has published its tax briefing which highlights key developments during the filing season that will impact taxpayers of all types for the rest of 2018.
The IRS will now focus on guidance for implementing the Tax Cuts and Jobs Act while Congress will shift its focus to technical corrections of the first phase of tax reform and a second phase of tax reform.
For more information, click here.
© 2018 CCH Incorporated and/or its affiliates. All rights reserved. Used with permission.
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OTC Markets Group's New Capital Raising Alternatives Now Available for SEC Reporting Companies
Summary -
OTC Markets Group is pleased to share an exciting development in their ongoing campaign to enhance the capital raising opportunities for Small-Cap companies. Last week, the Economic Growth, Regulatory Relief, and Consumer Protection Act (S. 2155) was enacted into law and included key legislation expanding Regulation A+ to SEC reporting companies.
Regulation A+ allows small companies to raise up to $50 million online, transparently and directly from the public without the extensive cost burden of a full SEC public offering. However, the SEC initially did not allow SEC reporting companies to raise capital through Regulation A+.
The passage of The Economic Growth, Regulatory Relief, and Consumer Protection Act (S.2155) marks a pivotal milestone for OTC Markets Group's smaller companies and issuers. Section 508 of the bill incorporates the Improving Access to Capital Act, based in large part upon OTC Markets Group's 2016 SEC Petition for Rulemaking. The Improving Access to Capital Act, which amends Regulation A+ to allow SEC reporting companies to use this innovative capital raising tool, was originally passed by the House of Representatives in September 2017 in a bipartisan, 404-3 vote.
OTC Markets Group believes this legislation will be instrumental to improving the capital raising process and increasing the number of public companies that can efficiently access their capital markets. They thank the members of the House and Senate who voted to pass S.2155, recognizing the work of Congresswoman Kyrsten Sinema (D-AZ) and Congressman Trey Hollingsworth (R-IN), lead sponsors of the Improving Access to Capital Act in the House, and collective efforts of Representatives Sinema and Hollingsworth, and cosponsors Rep. Roger Williams (R-TX), Rep. French Hill (R-AR), Rep. Luke Messer (R-IN), and Rep. Brad Sherman (D-CA), whose contributions led to this important initiative becoming law.
For more information on this important legislation, please click here.
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MaloneBailey Named Top Firm in Southwest and a Best & Brightest Company in Houston
Summary -
MaloneBailey, LLP, was recently named one of the top firms in the southwest region of the U.S. by Accounting Today for 2018. The firm was also named one of Houston's Best and Brightest Companies to Work For® in 2018 for the fifth year in a row.
Accounting Today's
annual top 100 accounting firms list ranks firms according to net revenue. The top 100 accounting firms list divides the ranking by region, and the southwest region includes Arizona, New Mexico, Oklahoma and Texas. According to Accounting Today, the region outperformed their previous year with total revenues for the southwest region exceeding $588 million and the average firm growth rate was 8%.
The Houston's Best and Brightest Companies to Work For® competition recognizes organizations throughout Houston that demonstrate excellent human resource practices and employee enrichment. Winners are measured and chosen based on a variety of criteria by an independent research firm. Of the over 300 company nominations submitted this year, 66 have been named as one of the Best and Brightest.
For more information, click
here
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