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The Financial Reporting Committee (FRC) of IMA® (Institute of Management Accountants) conducted its latest quarterly meeting with FASB on March 14-15 in Orlando, Fla.. Marc Siegel, member of the Financial Accounting Standards Board (FASB), attended the FRC’s meeting on March 14 to discuss issues that are currently on the Board’s agenda.
Status of FASB’s Future Agenda
The FASB has held education sessions to discuss feedback received from constituents on the four projects addressed in an agenda consultation invitation to comment issued by the Board in 2016. Board members asked FASB staff to conduct additional research, along with providing recommendations for prioritization of components of projects (e.g., elements related to the conceptual framework). The FASB is currently focusing on the conceptual framework and hedging and insurance projects.
Status of Implementation Issues of Standards Developed under FASB/IASB Convergence Project
Siegel discussed the status of implementation issues for the Leases, Financial Instruments Impairment and Revenue Recognition standards. The FASB has relied on different venues for feedback on implementation issues for the leases standard, including discussions with FASB staff and FRC member Jeff Ellis. Siegel confirmed that all technical inquires received by the FASB and the FASB’s staff to date has been addressed. Issues that benefit from transparency have been addressed at Board meetings.
Hedging Project
In comment letters on exposure drafts issued by the FASB on its hedging project, the FRC has expressed general support of the project.
Many decisions have been made by the Board on the hedging project in 2017 to date. Siegel shared that the goal was to issue guidance or hold a final vote on guidance by June 30, 2017 before the departure of some current Board members. FRC members support issuance of guidance sooner rather than later since it simplifies hedge accounting.
Disclosure Framework Project
The FRC has monitored and provided feedback on all phases of the FASB’s disclosure framework project. FRC members have expressed concern about the direction of the project in that the framework is not serving as a screen and the topic reviews have resulted in more proposed disclosures.
Siegel also acknowledged that feedback from constituents regarding the disclosure framework project has been mixed, mostly negative. Strong views were expressed in the FRC’s recent letter on inventory that the framework is too open ended. The Committee’s letter can be found on IMA’s website at https://www.imanet.org/about-ima/advocacy/financial-reporting-committee.
Roundtables for the disclosure framework project including materiality took place on March 17 to determine effectiveness of the Board decision process. FASB staff will present a game plan to the Board on how to move forward with the project based on feedback from roundtable sessions.
Status of FASB’s Future Agenda
The FASB has held education sessions to discuss feedback received from constituents on the four projects addressed in an agenda consultation invitation to comment issued by the Board in 2016. Board members asked FASB staff to conduct additional research, along with providing recommendations for prioritization of components of projects (e.g., elements related to the conceptual framework). The FASB is currently focusing on the conceptual framework and hedging and insurance projects.
Status of Implementation Issues of Standards Developed under FASB/IASB Convergence Project
Siegel discussed the status of implementation issues for the Leases, Financial Instruments Impairment and Revenue Recognition standards. The FASB has relied on different venues for feedback on implementation issues for the leases standard, including discussions with FASB staff and FRC member Jeff Ellis. Siegel confirmed that all technical inquires received by the FASB and the FASB’s staff to date has been addressed. Issues that benefit from transparency have been addressed at Board meetings.
Hedging Project
In comment letters on exposure drafts issued by the FASB on its hedging project, the FRC has expressed general support of the project.
Many decisions have been made by the Board on the hedging project in 2017 to date. Siegel shared that the goal was to issue guidance or hold a final vote on guidance by June 30, 2017 before the departure of some current Board members. FRC members support issuance of guidance sooner rather than later since it simplifies hedge accounting.
Disclosure Framework Project
The FRC has monitored and provided feedback on all phases of the FASB’s disclosure framework project. FRC members have expressed concern about the direction of the project in that the framework is not serving as a screen and the topic reviews have resulted in more proposed disclosures.
Siegel also acknowledged that feedback from constituents regarding the disclosure framework project has been mixed, mostly negative. Strong views were expressed in the FRC’s recent letter on inventory that the framework is too open ended. The Committee’s letter can be found on IMA’s website at https://www.imanet.org/about-ima/advocacy/financial-reporting-committee.
Roundtables for the disclosure framework project including materiality took place on March 17 to determine effectiveness of the Board decision process. FASB staff will present a game plan to the Board on how to move forward with the project based on feedback from roundtable sessions.