Revised 02/06/04—See below

Action Alert No. 04-05
February 5, 2004

NOTICE OF MEETINGS

OPEN BOARD MEETING
(Board meetings are available by audio webcast and telephone.)

Wednesday, February 11, 2004, 9:00 a.m.

[Revised 02/06/04—See revised order below.]

  1. FASB Staff Position: Medicare Act of 2003. The Board will consider whether the federal subsidy to plan sponsors under the Medicare Prescription Drug, Improvement and Modernization Act of 2003 should be accounted for (a) as a component of net periodic postretirement benefit cost under FASB Statement No. 106, Employers’ Accounting for Postretirement Benefits Other Than Pensions, or (b) outside the context of Statement 106. (Estimated 45-minute discussion.)

  2. Interpretation of Statement 87. The Board will consider a revised working definition of cash balance pension plan based on recommendations made at the January 21, 2004 meeting. At that meeting the Board directed the staff to explicitly incorporate the concept of front-loaded interest crediting and to emphasize that the term defined benefit plan has the meaning defined in FASB Statement No. 87, Employers’ Accounting for Pensions. (Estimated 15-minute discussion.)

    Loan commitments. [Revised 2/6/04—This topic has been deferred to a future Board meeting.] An important factor cited by the Board in undertaking this project in October 2003 was the great diversity in practice among issuers of loan commitments both in determining the fair value of loan commitments that must be accounted for as derivatives and in whether such commitments can ever be reported by the issuer as assets. On December 11, 2003, the SEC staff announced that it will soon release a Staff Accounting Bulletin that will require all registrants to begin accounting for their issued loan commitments (including interest rate lock commitments) subject to FASB Statement No. 133, Accounting for Derivative Instruments and Hedging Activities, as written options that would be reported as liabilities until either they are exercised (and a loan is made) or they expire unexercised. Thus, the current diversity in practice is expected to significantly decrease in the near future. The Board will discuss what urgency is appropriate for this project in view of the expected significant reduction in that diversity in practice. (Estimated 30-minute discussion.)

  3. Qualifying special-purpose entities and isolation of transferred assets. The Board will discuss issues related to the legal isolation criteria set forth in paragraph 9(a) of FASB Statement No. 140, Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities. The Board also is expected to reconsider issues related to transfers of undivided interests in financial assets and may discuss alternatives to the prior Board decision that the proposed amendment to Statement 140 require that transfers of undivided interests in portions of financial assets be accomplished via a qualifying special-purpose entity (SPE) in order to receive sale accounting treatment. Other issues that the Board may consider at this meeting include whether a public roundtable discussion should be held and the comment period of the revised Exposure Draft should remain at 45 days. (Estimated 60-minute discussion.)

  4. Equity-based compensation. The Board will discuss the results of the cost benefit procedures including the results of the field visits. (Estimated 60-minute discussion.)

  5. Open discussion. If necessary, the Board will allow time to discuss minor issues with staff members on technical projects or administrative matters. Those discussions are held following regular Board meetings as topics come up.

Wednesday, February 11, 2004, 1:00 p.m.

  1. AcSEC document. The Board will meet with representatives of the AICPA’s Accounting Standards Executive Committee (AcSEC) to consider final clearance of the AICPA Statement of Position, Accounting by Insurance Enterprises for Deferred Acquisition Costs on Internal Replacements Other Than Those Specifically Described in FASB Statement No. 97. (Estimated 60-minute discussion.)

OPEN EDUCATION SESSIONS

Wednesday, February 11, 2004, (tentative) immediately following the Board meeting
Thursday, February 12, 2004, 8:30 a.m.

The Board will hold educational, non-decision-making sessions to discuss topics that are anticipated to be discussed at the February 18, 2004 Board meeting. Those topics will be posted to the FASB calendar four days prior to the education session.

BOARD ACTIONS

The January 28, 2004 Board meeting was canceled due to inclement weather.

FUTURE OPEN MEETINGS

The following is a list of open meetings tentatively scheduled through March. Because schedules may change, please check the FASB calendar before finalizing your plans. Revisions to this list since the last issue of Action Alert are highlighted in bold.

Wednesday, February 18, 2004—FASB Board Meeting
Wednesday, February 18, 2004—FASB Education Session
Wednesday, February 25, 2004—FASB Board Meeting
Wednesday, February 25, 2004—FASB Education Session
Wednesday, March 3, 2004—FASB Board Meeting
Wednesday, March 3, 2004—FASB Education Session
Wednesday, March 10, 2004—FASB Board Meeting
Wednesday, March 10, 2004—FASB Education Session
Tuesday, March 16, 2004—FASB Board Meeting
Tuesday, March 16, 2004—FASB Education Session
Wednesday, March 17, 2004—EITF Meeting
Thursday, March 18, 2004—EITF Meeting
Tuesday, March 23, 2004—Financial Accounting Standards Advisory Council Meeting
Wednesday, March 24, 2004—FASB Board Meeting
Wednesday, March 24, 2004—FASB Education Session
Monday, March 29, 2004—Liaison Meeting with the American Bankers Association
Wednesday, March 31, 2004—FASB Board Meeting
Wednesday, March 31, 2004—FASB Education Session