New E-newsletter Offers Quick Updates from AFP's Accounting Expert

Betty Penzner, AFP

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From the July/Aug 2007 edition of Exchagne magazine

AFP's Accounting and Financial Reporting e-newsletter provides the latest information on accounting issues facing finance and treasury executives, from the SEC to Sarbanes-Oxley, to pension accounting standards and much more. All of this is written and developed by AFP's Director of Accounting and Financial Reporting, John Rieger, and distilled into a format that is quick to read.

John Rieger's expertise lies in auditing, accounting, financial reporting, corporate governance, tax, litigation support and business valuations. He previously owned an accounting practice, and was a transparency and disclosure advisor for the Organization for Economic Cooperation and Development in Paris, and a senior accounting and audit advisor for the U.S. Agency for International Development.

The newsletter has followed the developments of rules relating to SOX 404, such as the SEC guidance issued in December 2006 and the new audit standards proposed by the Public Company Accounting Oversight Board (PCAOB). This included a comment letter from AFP to the SEC and PCAOB. It also covered the postponement of the date by which smaller public companies must comply with the international control reporting requirements to the latest SOX 404 guidelines found in the June issue.

In June, the e-newsletter reported new guidance from the SEC for SOX 404 when it voted in May to approve its revised interpretive guidance to management for the evaluation of internal control over financial reporting. The PCAOB also voted in May 2007 to approve its proposal for a new standard (AS 5) on auditing internal control.

In addition, readers learned about issues being discussed by the Financial Accounting Standards Board (FASB) including FAS 133, FAS 157, FIN 48 (an interpretation of FAS 109), final standard FAS 159, and work between the International Accounting Standards Board (IASB) and FASB.

For example, when FASB voted to drop cash equivalents at its March 21, 2007 board meeting, the Accounting and Financial Reporting e-newsletter reported on the change and its impact on the industry.

"While the FASB chose not to go into the definition of what 'cash' is," wrote Rieger, "the International Accounting Standards Board (IASB) defines cash as currency on hand and demand deposits with banks and other financial institutions. It also includes 'other kinds of accounts that have general characteristics of demand deposits in that the customer may deposit additional funds at any time and also effectively may withdraw funds at any time without prior notice or penalty.'" FASB did define cash in FAS 95 and at this time wants companies to continue to use this definition, according to Rieger.

When the FASB finalized new pension rules on pension plan accounting last fall, the newsletter reported, "This phase I of a two-phase project requires companies to record the under- or over-funded pension of their defined benefit postretirement plan and other benefit obligations such as health care plan liabilities on the balance sheet."

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