Heads Up Newsletter

This issue discusses the SEC’s recently issued proposed rule Management’s Discussion and Analysis, Selected Financial Data, and Supplementary Financial Information, which would modernize Management’s Discussion and Analysis (MD&A) and certain financial disclosure requirements in SEC Regulation S-K.

Calendar-year-end public business entities adopted the FASB’s new leasing standard (ASC 842) on January 1, 2019. This Heads Up outlines the ASC 842 disclosure requirements, elaborates on some of those requirements, and provides examples of related SEC comments issued to registrants in 2019.

This Heads Up summarizes the FASB’s recently issued Accounting Standards Update (ASU) No. 2019-12, "Simplifying the Accounting for Income Taxes." The ASU enhances and simplifies various aspects of the income tax accounting guidance in ASC 740, including requirements related to the following: (1) Hybrid tax regimes; (2) The tax basis step-up in goodwill obtained in a transaction that is not a business combination; (3) Separate financial statements of entities not subject to tax; (4) The intraperiod tax allocation exception to the incremental approach; (5) Ownership changes in investments — changes from a subsidiary to an equity method investment (and vice versa); (6) Interim-period accounting for enacted changes in tax law; (7) The year-to-date loss limitation in interim-period tax accounting.

The AICPA Conference on Current SEC and PCAOB Developments provides a forum for key stakeholders involved in the financial reporting process to come together and discuss issues and trends affecting accounting, financial reporting, auditing, and other matters. Attendees at this year’s conference left with a greater appreciation for the critical role stakeholder communication plays in maintaining investor confidence and in the delivery of high-quality financial reporting.

This Heads Up discusses FASB Accounting Standards Update (ASU) No. 2019-11, Codification Improvements to Topic 326, Financial Instruments — Credit Losses, which amends certain aspects of the Board’s new standard on credit losses (ASU 2016-13, Measurement of Credit Losses on Financial Instruments).

This Heads Up discusses the FASB’s proposed Accounting Standards Update (ASU), Codification Improvements to Hedge Accounting, which would clarify certain amendments made by ASU 2017-12, Targeted Improvements to Accounting for Hedging Activities, to the guidance in ASC 815 on hedging activities. The FASB issued the proposal in response to feedback and questions received from stakeholders related to their implementation of ASU 2017-12. Comments on the proposed ASU are due by January 13, 2020.