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Accounting Research
Manager(TM)
Weekly Summary of
Developments
February 18-22, 2008
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Accounting Research
Manager subscriber,
The Accounting Research
Manager database now contains this week's weekly summary of developments. Click
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of this week's Weekly Summary.
Accounting and SEC
Headlines
Transfers of Financial
Assets -- FASB Issues
Staff Position Providing Guidance on Repurchase Financing Transactions
Pensions and Other
Postretirement Benefit Plans -- FASB Discusses Changes to Required Disclosures About Plan Assets and
Other Matters at February 13, 2008 Meeting
Financial Analysis -- SEC Releases Interactive Tool to
Analyze Public Company Financial Results
Securities Registration -- SEC Proposes Exemption For Foreign
Private Issuers
Inflation Rates -- Interpretation Updated, Inflation
Rates for Judging Whether an Economy Is Highly Inflationary - December 2007
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ACCOUNTING AND SEC HEADLINES:
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Transfers of Financial
Assets -- FASB Issues Staff Position Providing Guidance on Repurchase Financing
Transactions
For detail, please contact info@zy-cpa.com
The FASB issued FASB Staff
Position (FSP) FAS 140-3, Accounting for Transfers of Financial Assets and
Repurchase Financing Transactions. The FSP provides guidance on the
accounting for a transfer of a financial asset and a repurchase financing.
Repurchase financing is a repurchase agreement that relates to a previously
transferred financial asset between the same counterparties (or consolidated
affiliates of either counterparty), that is entered into contemporaneously
with, or in contemplation of, the initial transfer.
Under the FSP, a transferor
and transferee will not separately account for a transfer of a financial asset
and a related repurchase financing unless: (a) the two transactions have
a valid and distinct business or economic purpose for being entered into
separately; and (b) the repurchase financing does not result in the
initial transferor regaining control over the financial asset. An initial
transfer of a financial asset and repurchase financing that are entered into
contemporaneously with, or in contemplation of, one another shall be considered
linked unless all of the following criteria are met at the inception of the
transaction:
-The initial transfer and the
repurchase financing are not contractually contingent on one another.
-The repurchase financing
provides the initial transferor with recourse to the initial transferee upon
default.
-The financial asset subject
to the initial transfer and repurchase financing is readily obtainable in the
marketplace.
-The financial asset and
repurchase agreement are not coterminous (the maturity of the repurchase
financing must be before the maturity of the financial asset).
The FSP is effective for
financial statements issued for fiscal years beginning after November 15, 2008,
and interim periods within those fiscal years. Earlier application is not
permitted.
Pensions and Other
Postretirement Benefit Plans -- FASB Discusses Changes to Required Disclosures About Plan Assets and Other Matters at February 13, 2008
Meeting
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As reported in its
"Action Alert" publication, the FASB met on February 13, 2008, and
discussed the following topics:
-Disclosures about plan
assets; and
-Agenda decision: financial
reporting by entities in reorganization under the bankruptcy code.
The FASB decided to amend the
required disclosures about assets held in an employer's defined benefit pension
or other postretirement plans required by FASB Statement No. 132 (Revised
2003), Employers' Disclosures about Pensions and Other Postretirement
Benefits. Specifically, the FASB decided to amend Statement 132R to:
-Include a principle for disaggregation of plan assets based on risks and expected
long-term rate of return associated with each category and a list of required
asset categories that, at a minimum, should be included.
-Require further disclosure
of categories or subcategories for concentrations of risk.
-Include disclosures
consistent with FASB Statement No. 157, Fair Value Measurements, for
fair value measurements of plan assets that would be applicable to Level 3 of
the fair value hierarchy.
-Include a technical
correction to paragraph 8(h) that requires nonpublic entities to disclose net
periodic benefit cost recognized for each period for which a statement of
income is presented.
The FASB expects the revised
plan asset disclosure requirements would be effective for the years ending
after December 15, 2008, and would be applied prospectively. The FASB directed
its staff to proceed to a draft of a proposed FSP, with a 45-day comment
period.
The FASB also decided to add
a project to its agenda to address a conflict between AICPA Statement of
Position (SOP) 90-7, Financial Reporting by Entities in Reorganization Under the Bankruptcy Code, and other accounting
standards that expressly prohibit early adoption. The FASB agreed to amend SOP
90-7 to remove the requirement in paragraph 38 for an entity applying
fresh-start reporting to early adopt authoritative accounting standards that
will result in a change in accounting principle that will be required in the
emerging entity's financial statements within 12 months following emergence.
The FASB directed its staff to proceed to a draft of a proposed FSP, with a
30-day comment period.
Financial Analysis -- SEC
Releases Interactive Tool to Analyze Public Company Financial Results
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We have published a hot topic
that discusses the SEC's release of the "Financial Explorer," an
online tool for analyzing public company financial results and performance. The
tool uses financial information provided in filings with the SEC as
"interactive data" in eXtensible Business
Reporting Language (XBRL). XBRL is a technology standard that can be applied to
the creation of financial statement data and other reporting situations. It is
used for the reporting of business and financial information and can make the
process of creating, distributing, reporting and analyzing information more
efficient and effective.
Financial Explorer allows
users to automatically create the following items for a particular registrant
who has filed financial information using XBRL:
-Financial ratios;
-Diagrams showing the
relationship between financial statement line item values and changes in those
values from one period to the next;
-Financial highlights,
showing important financial performance results;
-Graphs; and
-Charts.
See our hot topic for
complete details.
Securities Registration --
SEC Proposes Exemption For Foreign Private Issuers
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The SEC published for public
comment, Exemption from Registration under Section 12(g) of the Securities
Exchange Act of 1934 for Foreign Private Issuers. The proposal would amend
the exemption for foreign private issuers from having to register a class of
equity securities under Section 12(g) of the Securities Exchange Act of 1934
("Exchange Act") based on the submission to the SEC of certain
information published outside the
Comments on the proposal are
due April 25, 2008.
Inflation Rates --
Interpretation Updated, Inflation Rates for Judging Whether an Economy Is
Highly Inflationary - December 2007
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We have updated our
Interpretation, Inflation Rates for Judging Whether an Economy Is Highly
Inflationary - December 2007, which was issued on January 16, 2008 and
reflects the latest available inflation rate information as of that date. We
have updated the Interpretation to be consistent with the views of the AICPA
International Practices Task Force that
See our Literature Update for
complete details.
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