What's new at the Financial Accounting Standards Board and International Accounting Standards Board with respect to private companies?
- As previously reported, the Financial Accounting Foundation is expected to move toward a decision at its upcoming meeting in May on its earlier proposed Plan to Establish the Private Company Standards Improvement Council.
- In conjunction with the above action, FASB is expected to move toward releasing a Discussion Paper for public comment on the definition of a Nonpublic Entity. FASB staff have also been developing a framework for private company standard setting.
- In their joint board meeting this week, FASB and the International Accounting Standards Board are scheduled to discuss a number of projects impacting private and public companies. These include their joint projects on Investment Entities, Financial Instruments, and Insurance Contracts. Results of the discussion taking place at the three days of joint board meetings this week are being posted to FASB's Summary of Board Decisions. See also Financial Instruments in Focus at FASB, IASB.
- Earlier today, FASB posted for public comment three Exposure Drafts of proposed Accounting Standards Updates, representing consensuses of FASB's Emerging Issues Task Force. The comment deadline is July 16.
What can private companies do in the meantime to stay current on these developments and continue to provide feedback to FAF and FASB?
IASB, IFRS for SMEs
- Consider joining FEI's Committee on Private Company Standards. CPC-S, currently chaired by George Beckwith, chief financial officer, National Gypsum Co., advocates on behalf of FEI's private company members on issues of importance before the accounting standard setters, via meetings, conference calls and comment letters. Contact Lorraine Malonza at firstname.lastname@example.org to learn more about CPC-S.
- Provide input directly to FASB by signing up for FASB's 'resource list' of private company contacts.
- Bookmark FASB's nonpublic entity resources page, which provides links to updated information on FASB projects of particular interest to private companies.
- Keep current on FAF News, including the recent release of FAF's 2011 annual report.
- Bookmark FEI's news page, which includes up to date news on FASB, IASB and other standard-setters and regulators; sign up for email updates from the FEI blog for news updates from the blog delivered via email in real-time.
- Nonpublic entity fair value measurement disclosures was discussed by FASB in a (non-decision making) educational session last week.
A few years ago IASB published a concise, self-contained set of International Financial Reporting Standards for Small and Medium Sized Entities (IFRS for SMEs). These standards are available for use by nonpublic entities, generally defined (refer to IFRS for SMEs for precise definition, and subject to requirements of particular jurisdictions approving use of IFRS for SMEs in lieu of full IFRS) which do not issue public securities, and do not have "public accountability." The term public accountability includes some financial and fiduciary entities, even if otherwise deemed "nonpublic entities."