- Income
taxes (estimated 1-hour discussion). The Board will discuss
five remaining issues that need to be addressed before drafting an
exposure document to converge the accounting for income taxes between
the IASB and the FASB. Those issues are (a) definition of tax basis,
(b) realizability of deferred tax assets, (c) change in tax status,
(d) distributed versus undistributed tax rate, and (e) comment period,
effective date, and transition.
- Derivative
disclosures (estimated 1.5-hour discussion).The Board will
continue its redeliberations of the Exposure Draft, Disclosures
about Derivative Instruments and Hedging Activities. The Board
will discuss (a) contingent features in derivative instruments, (b)
notional amounts and leverage factors, (c) whether to require
disclosures for both interim and annual reporting periods or for only
annual periods, (d) scope exception for "trading" derivatives, (e)
tabular disclosure of cumulative adjustments to hedged items in fair
value hedges, (f) whether to require qualitative disclosures that are
currently encouraged by paragraph 44 of FASB Statement No. 133,
Accounting for Derivative Instruments and Hedging Activities,
and (g) effective date and transition.
- 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.
OPEN EDUCATION SESSION
Wednesday, December 5, 2007, following the Board meeting
The Board will hold an educational, non-decision-making session to
discuss topics that are anticipated to be discussed at a future Board
meeting. Those topics will be posted to the FASB calendar four
days prior to the education sessions.
OPEN MEETING OF THE FINANCIAL ACCOUNTING STANDARDS ADVISORY
COUNCIL
(This
meeting is available by audio webcast and telephone, except the portion
noted below.)
Thursday, December 6, 2007, 8:30 a.m.
The Advisory Council will meet to discuss the following topics:
- Current business and financial reporting issues related to
international convergence and the financial reporting environment
- The Board's project on revenue recognition*
- FASB Statement 133 issues
- Planning FASAC input on FASB agenda setting
- Potential project on intangible assets
- XBRL
- Education session on the Codification and XBRL.
The Advisory Council will hear reports from the chairman of the FASB
on other Board activities and from a representative of the office of the
SEC chief accountant on current accounting-related developments. The
Advisory Council also will hear a report from a representative of the
Public Company Accounting Oversight Board.
*Audio webcast and telephone not available from approximately 10:30
a.m. to 11:30 a.m
The Advisory Council will hold concurrent break-out group discussions
on the revenue recognition project following the morning break until
approximately 11:30 a.m. Because there will be multiple break-out group
discussions during that time, the discussions will not be available via
webcast or telephone. However, the Advisory Council will reconvene at
approximately 11:30 a.m. to discuss the results and summary of the
break-out discussions. That group session will be available via webcast
and telephone.
OPEN MEETING OF THE SMALL BUSINESS ADVISORY COMMITTEE
(This
meeting is available by audio webcast and telephone, except the portion
noted below.)
Friday, December 7, 2007, 9:00 a.m.
The Small Business Advisory Committee will meet to discuss the
following topics:
- Private company reporting activities
- The Board's project on revenue recognition*
- The movement toward IFRS
- The Board's project on fair value hedge accounting
- The Board's project on certain nonfinancial liabilities.**
The Advisory Committee will hear a report from the chairman of the
FASB on other Board activities. The Advisory Committee also will hear
reports from representatives of the Office of the Chief Accountant of
the SEC and the Office of the Chief Auditor of the Public Company
Accounting Oversight Board.
*Audio webcast and telephone not available from 10:45 a.m. to
approximately 11:45 a.m.
The Advisory Committee will hold break-out group discussions on the
revenue recognition project from 10:45 until approximately 11:45 a.m.
The break-out group discussions will not be available via webcast or
telephone. The Advisory Committee will reconvene at approximately 11:45
a.m. for a group discussion on the revenue recognition project. That
session and the remainder of the meeting will be available via webcast
and telephone.
**Prior to the start of the Advisory Committee meeting, there will be
an open education session covering the Board's project on certain
nonfinancial liabilities. It is scheduled from 8:15 a.m. to 9:00 a.m. in
the Board room and it will not be available by audio webcast and
telephone.
BOARD ACTIONS
The Board Actions are provided for the information and convenience
of constituents who want to follow the Board's deliberations. All of the
conclusions reported are tentative and may be changed at future Board
meetings. Decisions are included in an Exposure Draft for formal comment
only after a formal written ballot. Decisions in an Exposure Draft may
be (and often are) changed in redeliberations based on information
provided to the Board in comment letters, at public roundtable
discussions, and through other communication channels. Decisions become
final only after a formal written ballot to issue a final Statement,
Interpretation, FSP, or Statement 133 Implementation Issue.
November 21, 2007 Board Meeting
Conceptual
framework: measurements. The staff presented the Board with a review
of the measurement basis candidates selected and defined in Milestone I
of the measurement phase.
The Board agreed to a revised project plan for the measurement phase
that calls for the Board to consider the staff's initial evaluation of
the measurement basis candidates in February or March 2008. In
subsequent meetings, the Board will consider issues related to selecting
measurement bases for use in financial statements. The goal is to issue
a discussion paper describing the Board's view on those issues by the
end of 2008.
The Board decided to defer issues related to measurements used
outside of the financial statements to a later phase of the framework
project.
The Board also discussed a preview of the decision tool for
evaluating and selecting measurement bases. The Board directed the staff
to further develop the decision tool and to test it with examples to
help the Board understand how the decision tool will be applied.
Financial
guarantee insurance. The Board began redeliberations of the Exposure
Draft, Accounting for Financial Guarantee Insurance Contracts,
and discussed scope, claim liability recognition and measurement, and
premium revenue recognition. The Board decided the following:
- Application of the final Statement should be limited to financial
guarantee insurance (and reinsurance) contracts issued by insurance
enterprises.
- An insurance enterprise should recognize a claim liability on a
financial guarantee insurance contract when the insurance enterprise
expects that a claim loss will exceed the unearned premium revenue
(liability) for that contract based on expected cash flows. The
discount rate used to measure the claim liability should be based on
the market risk-free rate and updated each quarter (with additional
disclosures to be addressed at a future meeting).
- Premium revenue recognition guidance will be provided, and the
premium revenue recognition approach should be based on applying a
fixed percentage of premium to the amount of exposure outstanding at
each reporting date (referred to as the level-yield approach). The
term of a financial guarantee insurance contract should be the
contractual term unless the insured financial obligation is subject to
prepayments and those prepayments are probable and reasonably
estimated. (However, the Board requested that the staff draft and
present at a future meeting a principle that prescribes when
prepayment data are used to shorten the term of the contract.) The
measurement of the exposure outstanding should be based on the
remaining principal payments.
REVENUE RECOGNITION PROJECT INFORMATION
The Board held an open education session on November 20, 2007, for
the revenue
recognition project. In that non-decision-making session, the Board
discussed several staff-prepared memos explaining the measurement model
of revenue recognition and how it compares to existing U.S. GAAP. That
discussion was intended to continue at a future non-decision-making
Board meeting. However, the thoroughness of the education session
rendered the planned Board meeting discussion unnecessary. Those who are
interested in reading the materials discussed at the education session
can access them at http://www.fasb.org/board_handouts/11-20-07_RR_Educ_Session.pdf
FASB DOCUMENTS AVAILABLE
Proposed FSP
FAS 142-f, Determination of the Useful Life of Intangible
Assets (November 26, 2007). Comments are requested by January 16,
2008.
Proposed FSP
FAS 157-a, Application of FASB Statement No. 157 to FASB
Statement No. 13 and Its Related Interpretive Accounting Pronouncements
That Address Leasing Transactions (November 28, 2007). Comments are
requested by January 4, 2008.
FUTURE OPEN MEETINGS
The following is a list of open meetings tentatively scheduled
through January. 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, December 12, 2007—FASB Board Meeting
Wednesday,
December 12, 2007—FASB Education Session
Wednesday, December 19,
2007—FASB Board Meeting
Wednesday, December 19, 2007—FASB Education
Session
Friday, January 4, 2008—FASB Board Meeting
(tentative)
Friday, January 4, 2008—FASB Education
Session
Wednesday, January 9, 2008—FASB Board Meeting
Wednesday,
January 9, 2008—FASB Education Session
Wednesday, January 16,
2008—FASB Board Meeting
Wednesday, January 16, 2008—FASB Education
Session
Wednesday, January 23, 2008—FASB Board Meeting
Wednesday,
January 23, 2008—FASB Education Session
Friday, January 25,
2008—Liaison Meeting with National
Association of Real
Estate Investment Trusts
Wednesday, January 30, 2008—FASB Board
Meeting
Wednesday, January 30, 2008—FASB Education Session
†FASB Meetings Available by Audio Webcast and
Telephone
To monitor available live meetings free of charge by
audio webcast, access the link http://www.trz.cc/fasb/live.html. To monitor by
telephone, call 1-800-846-4717. You will be charged $.45 per minute, and
VISA, MasterCard, American Express, or Discover Card is required. To
listen to a recording of the most recent Board meeting via webcast free
of charge, access the link http://www.trz.cc/fasb/archive.html. To listen to
a recording by telephone, for a charge of $.45 per minute, call
1-800-462-0393. Questions can be directed to 1-800-846-4630.
Handouts
distributed to the audience at Board meetings are posted to our website
one-half hour before the start of the meeting. A synopsis of
each issue to be discussed at EITF meetings also is posted to this
website.
Education sessions are not available by audio webcast or
telephone, and no handouts are distributed to the
audience.