Featured Podcast
Our newest podcast this month features Steven Vertucci, Audit Partner, as he discusses one of the FASB updates featured in this newsletter, Topic 718, which pertains to improvements to nonemployee share-based payment accounting. Steven also provides information on who this update affects and when it will go into effect. Please see below for the full summary of the Topic 718 update.
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Missed Our January Recap of 2016 and Look Ahead to 2017?
Visit our
website for the January 2017 newsletter, which highlights the
FASB updates that went into effect in 2016 as well as the
updates
you can expect to
become effective in 2017.
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April 2017
We are pleased to release MaloneBailey's April 2017 newsletter highlighting recent SEC and FASB updates and proposals. Please note that the updates provided in this newsletter are not a comprehensive list. We have selected the updates and proposals that we believe may be of relevance to you. Our goal is to provide you with resources to keep you informed of the ever-changing rules and regulations related to regulatory and accounting matters.
We encourage you to visit the SEC and FASB websites for more information as well as a complete list of updated rules, regulations and proposals. We invite you to contact us should you have any questions about the information provided in this issue. You can find a list of MaloneBailey partners and their contact information at the end of this newsletter.
For easy navigation, please refer to the 'In This Issue' section, which contains a hyperlinked table of contents of rule regulation proposals and updates that may affect you. We invite you to visit our website to review archived versions of this newsletter containing past SEC and FASB updates and proposals.
The MaloneBailey Team
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In This Issue
SEC Updates & Proposals
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 FASB Proposed Accounting Standards Update 2017-220 - Compensation - Stock Compensation (Topic 718) - Improvements to Nonemployees Share-Based Payment Accounting
Click on the video below to hear Steven Vertucci, Audit Partner, explain Topic 718, as well as who is affected by this update and when it will go into effect.
Summary -
The FASB has issued proposed Accounting Standards Update (ASU), Compensation - Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. This proposed ASU is intended to reduce cost and complexity and to improve financial reporting for nonemployee share-based payments. Stakeholders are encouraged to review and provide comments on the proposal by June 5, 2017.
The proposed ASU would expand the scope of Topic 718, Compensation: Stock Compensation, which currently only includes payments to employees, to include payments for goods and services to nonemployees. Consequently, the accounting for share-based payments to nonemployees and employees would be similar. The proposed ASU would supersede Subtopic 505-50, Equity: Equity Based Payments to Non-Employees.
The accounting for nonemployee share-based payment transactions was identified as an area for simplification through:
- Ideas submitted to the FASB as part of the FASB's Simplification Initiative;
- The Private Company Council's ongoing dialogue about making improvements to accounting for share-based payments; and
- The Post-Implementation Review of FASB Statement No. 123(R), Share-Based Payment.
The FASB will determine an effective date after redeliberating input received during the comment period.
For more information, click here.
© 2017 CCH Incorporated and/or its affiliates. All rights reserved. Used with permission.
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FASB Accounting Standards Update No. 2017-05 - Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets
Summary -
The FASB has issued Accounting Standards Update No. 2017-05, Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets.
A contract may involve the transfer of both nonfinancial assets and financial assets (e.g., cash and receivables). The amendments clarify that a financial asset is within the scope of Subtopic 610-20 if it meets the definition of an in substance nonfinancial asset. The amendments also define the term in substance nonfinancial asset.
The amendments clarify that nonfinancial assets within the scope of Subtopic 610-20 may include nonfinancial assets transferred within a legal entity to a counterparty. For example, a parent may transfer control of nonfinancial assets by transferring ownership interests in a consolidated subsidiary. A contract that includes the transfer of ownership interests in one or more consolidated subsidiaries is within the scope of Subtopic 610-20 if substantially all of the fair value of the assets that are promised to the counterparty in a contract is concentrated in nonfinancial assets.
The amendments clarify that an entity should identify each distinct nonfinancial asset or in substance nonfinancial asset promised to a counterparty and derecognize each asset when a counterparty obtains control of it.
The amendments are effective at the same time Topic 606, Revenue from Contracts with Customers, is effective. For public entities, the amendments are effective for annual reporting periods beginning after December 15, 2017, including interim reporting periods within that reporting period. For all other entities, the amendments are effective for annual reporting periods beginning after December 15, 2018, and interim reporting periods within annual reporting periods beginning after December 15, 2019.
For more information, click here.
© 2017 CCH Incorporated and/or its affiliates. All rights reserved. Used with permission.
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Summary -
The SEC has issued a final rule that will require registrants that file registration statements and reports subject to the exhibit requirements under Item 601 of Regulation S-K, or that file Forms F-10 or 20-F, to include a hyperlink to each exhibit listed in the exhibit index of these filings. To enable the inclusion of such hyperlinks, the amendments also require that registrants submit all such filings in HyperText Markup Language ("HTML") format.
The final rule is effective September 1, 2017. Registrants must comply with the final rules for filings submitted on or after September 1, 2017. A registrant that is a "smaller reporting company," as defined in Securities Act Rule 405 and Exchange Act Rule 12b-2, or that is neither a "large accelerated filer" nor an "accelerated filer," as defined in Exchange Act Rule 12b-2, and that submits filings in ASCII need not comply with the final rules until September 1, 2018, one year after the effective date.
The compliance date with respect to any Form 10-D that will require hyperlinks to any exhibits filed with Form ABS-EE is delayed until SEC staff has completed technical programming changes to allow issuers to include such forms in a single submission. Once these programming changes are complete, the Commission will publish in the Federal Register a document notifying the public of the compliance date for Form 10-D.
For more information, click here.
© 2017 CCH Incorporated and/or its affiliates. All rights reserved. Used with permission.
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Adoption of Updated EDGAR Filer Manual
Summary -
The SEC has issued a final rule, Adoption of Updated EDGAR Filer Manual. This final rule includes revisions to the Electronic Data Gathering, Analysis, and Retrieval System (EDGAR) Filer Manual and related rules to reflect updates to the EDGAR system. The updates are being made primarily to support an upgrade to the passphrase authentication process and update the recommended Internet browser language for all EDGAR websites.
This final rule is effective upon publication in the Federal Register.
For more information, click here.
© 2017 CCH Incorporated and/or its affiliates. All rights reserved. Used with permission.
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Summary -
The SEC has issued for public comment a proposal to require the use of the Inline XBRL format for the submission of operating company financial statement information and mutual fund risk/return summaries. The proposed amendments are intended to improve the data's quality, benefiting investors, other market participants, and other data users, and to decrease, over time, the cost of preparing the data for submission to the SEC. The proposed amendments would also eliminate the requirement for filers to post Interactive Data Files on their websites and terminate the Commission's voluntary program for the submission of financial statement information interactive data that is currently available only to investment companies and certain other entities.
Comments on the proposal are due 60 days from publication in the Federal Register.
For more information, click
here.
© 2017 CCH Incorporated and/or its affiliates. All rights reserved. Used with permission.
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Proposed Amendments to Exchange Act Rule 15c2-12
Summary -
The SEC has issued for public comment a proposal to require the use of the Inline XBRL format for the submission of operating company financial statement information and mutual fund risk/return summaries. The proposed amendments are intended to improve the data's quality, benefiting investors, other market participants, and other data users, and to decrease, over time, the cost of preparing the data for submission to the SEC. The proposed amendments would also eliminate the requirement for filers to post Interactive Data Files on their websites and terminate the Commission's voluntary program for the submission of financial statement information interactive data that is currently available only to investment companies and certain other entities.
Comments on the proposal are due 60 days from publication in the Federal Register.
For more information, click
here.
© 2017 CCH Incorporated and/or its affiliates. All rights reserved. Used with permission.
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