Assignment 1: Research of Emerging Accounting Issues
This paper I’ll research the most important impact that the mission of the Emerging Issues Task Force (EITF) exerts upon the Financial Accounting Standards Board (FASB); analyze the EITF’s effectiveness with finding resolutions to emerging accounting issues by research the issues from the EITF’s “Description and Status of Current Issues” such as 9/11 and analyze at least the primary manner in which a company’s accounting and financial reporting is likely to be impacted by the work being done by the EITF on the chosen issues example unrecognized tax benefit.
Emerging Issues Task Force exerts upon the…show more content… Early extinguishment happens because of extraordinary reasons and losses resulting from it should be treated as extraordinary. (www.fasb.org)
The work being done by the EITF with company’s accounting and financial reporting is likely to be impacted by the work being done by the EITF on Issue No. 13-C, "Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carry forward, a Similar Tax Loss, or a Tax Credit Carry forward Exists." A company's accounting and financial reporting will be impacted by the work being done by the EITF in two ways. First, if the liability for an unrecognized tax benefit is directly associated with a tax position taken in a tax year that results in the recognition of Net Operating Loss carry-forward for that year and that Net Operating Loss carry-forward has not been used, the unrecognized tax benefit will be presented as a reduction to the Net Operating Loss. In this case the Income Statement is impacted and the Net Operating Loss is reduced. Second, in all other case the Net Operating Loss carry-forward or the Tax Credit Carry-forward should be presented as a liability. In this case the Balance Sheet of the company will be impacted. (www.fasb.org)
Against the EITF
In the issue 1 requiring providing additional guidance on the accounting anomaly