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Action Alert No. 08-26
June 26, 2008
NOTICE OF MEETINGS
OPEN BOARD MEETING
(Board
meetings are available by audio webcast and telephone.)
No Board meetings are planned for the weeks of June 30, 2008, and
July 7, 2008. The next scheduled Board meeting is Wednesday, July 16,
2008.
OPEN EDUCATION SESSION
Wednesday, July 2, 2008, 9:00 a.m.
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 session.
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.
June 18, 2008 Board Meeting
Earnings
per share. The Board decided not to provide a specific effective
date in the revised Exposure Draft on earnings per share. Rather, the
Board will determine the effective date after it completes redeliberations
of the revised Exposure Draft. The Board did decide, however, that the
revised Exposure Draft should indicate that a final Statement would be
effective as of the beginning of a fiscal year.
Financial
statement presentation. The Board confirmed the decision made at
the April joint meeting with the IASB that this project should not seek to
change existing standards relating to what items are recognized outside of
profit or loss, thereby retaining existing guidance on presentation of
other comprehensive income items in a statement of comprehensive income
and on the recycling mechanism. Based on that change in the project’s
scope, the Board decided that the Preliminary Views would express its view
that:
- An entity should present a standalone statement of comprehensive
income with other comprehensive income items presented in a separate
section. The Board clarified that within that other comprehensive income
section an entity should indicate (parenthetically or otherwise) the
category (operating, investing, or financing) to which each item of
other comprehensive income relates.
- Income taxes should continue to be allocated among continuing
operations, discontinued operations, items of other comprehensive
income, and items charged or credited directly to equity using existing
guidance on intraperiod tax allocation.
- An entity should present income tax assets, liabilities, and cash
flows in a separate section in the statements of financial position and
cash flows, respectively. The Board agreed to not include the income tax
disclosures addressed in March 2008 (related to the reconciliation
explaining the relationship of income tax expense and accounting profit)
in this project as they will be addressed in the income tax project.
The Board decided that the project should not:
- Make any further changes to the statement of changes in equity
- Address disclosures related to capital management and to measurement
uncertainty
- Propose changes to presentation of earnings per share (or any other
metrics) and, thus, will not amend FASB Statement No. 128, Earnings
Per Share.
The Board also decided that the Preliminary Views should not
address:
- Offsetting or disclosures about the measurement bases of assets and
liabilities as those issues will be addressed in the Exposure Draft
stage of the project
- Possible additional segment disclosures; however, the Preliminary
Views should ask for input on whether the Board should address segment
disclosures beyond consequential amendments.
The Board made the following decisions; all but item (4) below modify
its previously expressed views:
- The schedule reconciling the statement of cash flows to the
statement of comprehensive income should not include equity transactions
(therefore, it would not include the equity section of the statement of
cash flows). Changes in assets and liabilities not attributable to
remeasurements should be included in a single column and not further
disaggregated.
- An entity should determine how much information is presented in the
discontinued operations section by applying the disaggregation objective
(that is, information should be disaggregated if the additional
information will be useful to users of financial statements in assessing
future cash flows).
- The Preliminary Views should not express a preference for allocating
the effects of basket transactions to categories; rather, it should
describe allocation and nonallocation alternatives and ask for input
from constituents.
- An entity should display transaction gains and losses, including the
components of any net gain or loss on remeasuring the financial
statements of an entity into its functional currency, in the same
section and category as the assets or liabilities that gave rise to
those gains or losses.
The Board also discussed a number of issues raised in the drafting
process and, among other things, clarified its views on the definition of
the operating and investing categories and on the disaggregation of
information by function and nature in the statement of comprehensive
income.
The Board decided that the Preliminary Views should state that the
Board has not considered whether its views on financial statement
presentation would apply to nonpublic entities. The Board will consider
that issue in the Exposure Draft stage of the project.
The Board authorized the staff to proceed to a draft of a Preliminary
Views for vote by written ballot, with a six-month comment period. The
Board expects to issue the Preliminary Views in September 2008. During the
comment period, a number of companies will be field testing the Board’s
Preliminary Views.
FUTURE OPEN MEETINGS
The following is a list of open meetings tentatively scheduled through
August. 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.
Thursday, July 10, 2008—FASB Education Session
Wednesday, July 16,
2008—FASB Board Meeting
Wednesday, July 16, 2008—FASB Education
Session
Wednesday, July 23, 2008—FASB Board Meeting
Wednesday, July
23, 2008—FASB Education Session
Wednesday, July 30, 2008—FASB Board
Meeting
Wednesday, July 30, 2008—FASB Education Session
Wednesday,
August 6, 2008—FASB Board Meeting
Wednesday, August 6, 2008—FASB
Education Session
Wednesday, August 13, 2008—FASB Board
Meeting
Wednesday, August 13, 2008—FASB Education Session
Wednesday,
August 20, 2008—FASB Board Meeting
Wednesday, August 20, 2008—FASB
Education Session
Wednesday, August 27, 2008—FASB Board
Meeting
Wednesday, August 27, 2008—FASB Education Session
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