convergence process I. CONVERGENCE OF U.S. GAAP AND IFRS Since 2002, Financial Accounting Standards Board (FASB) and International Accounting Standards Board’s (IASB) have been working toward “convergence” of US General Accepted Accounting Principles (GAAP) and International Financial Reporting Standards (IFRS). They have made significant progress in efforts to converge critical accounting standards such as those dealing with revenue recognition, financial instruments and leases. Once these
Introduction & Intent of Project The International Accounting Standards Board (IASB) and The Financial Accounting Standards Board (FASB) have undertaken a joint revenue recognition project that clarifies the principles for recognizing revenue that can be applied consistently across various transactions, industries, and capital markets. This project will apply to all contracts with customers except leases, financial instruments and insurance contracts. The joint project will attempt to remove
Introduction Accounting for leases is regulated by the Financial Accounting Standards Board (FASB) in United States .Standards for accounting leases have been effective since 1977 (Accounting Standard Board, 2004). The primary standard for lease accounting is Statement of Financial Accounting Standards No. 13 (FAS 13). According to FASB (1976), a lease is an agreement conveying the right to use property, plant, and equipment (PPE) usually for a stated period of time. Examples of assets that can
Proposed Accounting Standard Update Topic 205 Review Introduction The Financial Accounting Standards Board (FASB) writes the code that directs certified public accountants and accounting professionals in non-governmental environments. On occasions, the FASB proposes changes to those accounting standards. This process includes exposure drafts. The issuance of exposure drafts is for individual and business comments. The input from the respondents in comment letters is analyzed and considered by
of international business there is a need to standardize financial statements globally. Presently there are “approximately 120 foreign private issuers currently that report to the Commission using IFRS financial statements.” By standardizing accounting practices investors will be able to make informed decisions based on comparability and accuracy of financial statements. The SEC released this statement in 2008, “We believe that IFRS has the potential to best provide the common platform on which
Mohammed Alhamid Bruce Bettinghaus ACC 620 24 October 2014 Disclosure Framework: Board’s Decision Process 1. Introduction In October 3, 2014 the Financial Accounting Standard Board (FASB) issued proposed updates to the disclosure framework for the board decision process. This disclosure framework is meant to improve the effectiveness of disclosures in notes to financial statements. According to the disclosure framework effectiveness of the
Existing lease accounting standards require lessees to classify their lease contracts as either finance or operating leases. If a lease is classified as a finance lease, assets (and liabilities) are recognized in its statement of financial position. For an operating lease, the lessee simply recognizes lease payments as an expense over the lease term. This split into finance and operating leases has given rise to a number of problems. The International Accounting Standards Board (IASB) and the
the models which provide guidance on how entities should determine the fair value of financial instruments for reporting purposes. This paper discusses the Financial Accounting Standards Board (FASB) Exposure Draft issued on December 3, 2015 which proposed amendments to Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements. The paper analyzes some of the key points of the exposure draft, among other things, the history and development the concept of fair
FASB’s Proposed Accounting Standards Update The Financial Accounting Standards Board (FASB) is currently conducting a project that is referred to as the “Simplification Initiative.” As such, the board’s goal is to “identify, evaluate, and improve areas of general accepted accounting principles (GAAP) for which cost and complexity can be reduced while maintaining or improving the usefulness of the information provided to users of the financial statements” (“Exposure Draft, Proposed Accounting Standards
Scope “Accounting Standards Codification (ASC) 740, Income Taxes addresses how companies should account for and report the effects of taxes based on income” as stated on the PWC article titled Scope of ASC 740. It provides guidance for recognizing and measuring tax positions taken or expected to be taken in a tax return that directly or indirectly affect amounts reported in financial statements. The standard requires recognition of the current and future income tax consequences of all entities included