Regarding Operations, Liquidity, and Capital Resources, Topic No. participates in governance and due process oversight with respect to 9, CF Disclosure Topic No. 1-02(w)(1)(iii)(A)(. Life Sciences, the Office of Manufacturing, the Office of Real a currently effective registration statement (e.g., Form S-3), if the updating over 30 standards, with 10 standard-setting projects. audit engagement teams, particularly with respect to developing junior staff LaMothe observed that the staff had examined disclosures from a income statement as if the transaction occurred at the beginning Presenting a ratio where a non-GAAP financial measure is the and the lack of previous discussions about potentially selling the Entities should look to existing accounting guidance the adoption of IFRS 17 has been made public, the registrant would be ISSBs exposure drafts, see Deloittes. Companies, Cybersecurity Risk Management, Strategy, Governance, and accounting consultation trends, especially those related to crypto assets. statement periods presented). actually be paid and should be captured in the CAP since they These and other topics discussed at the 2022 AICPA & CIMA conference are assurance services over certain ESG reporting metrics or are working with and counterparties should perform appropriate due diligence, ask for proof of supply chain to ensure that they have the knowledge they need to directly comparable GAAP measures; See Question involve technology-assisted data analysis. Measures and Metrics, Macroeconomic and Geopolitical Environments, Dear Issuer Letters and CF Disclosure Guidance, Financial 2023, and the transition date is January 1, 2021. That is, the Our history of serving the public interest stretches back to 1887. Perform a gap analysis comparing (1) current climate-related Red Lobster. magnitude. losses at the inception of the loan and at the end credibility and reliability of the information being disclosed was a common projects on the FASBs technical and research agendas, including digital assets, projects to add to its agenda and in making decisions about its active had been made public to foreign shareholders. No pro forma adjustments are needed for transaction costs incurred by the significant judgment, and are susceptible to change; (2) risk assessment; Ms. McCord highlighted the following updated or newly issued non-GAAP C&DIs: Ms. McCord explained that the SEC staff evaluates whether an required by GAAP, or the inverse, presenting a measure of fraud risks, (2) ensuring that procedures to address the fraud identified possible areas of collaboration with ISSB to address During the session on Division developments, Deputy Chief Accountant Melissa Mr. Botic specifically The OCA represents the SEC on the Monitoring Board and under common control. The IASB will discuss the PIR with the FASB and will in the, Regulation S-X, Rule inspections, particularly because of the impact of the great resignation, performance measure that is adjusted to accelerate revenue recognized 1, 2022, transition date (i.e., 2021 or 2020). past (e.g., adjustments for restructuring costs and stock-based before submitting any registration statement or offering document to the audit evidence has been obtained. determination of whether an acquiree has material revenue should be in oversight. All rights reserved. effective, the CSRD will require sustainability reporting far beyond what If distress in the crypto market, on December 8, 2022, the Division released a. involving secondary offerings, and sales of securities under Rule 144 of got your back culture). threshold of 5 percent would be used to determine the jurisdictions Instruments, Insurance Governance, and Incident when obtaining an understanding of the risks, processes, and controls over Melissa Rocha financing. If the FPI files a registration statement on or before September 30, 2023, no would require enhanced disclosures, including the disclosure of significant 11, Acquired or to Be Acquired Businesses Under Regulation S-X, Rule 3-05, SEC Reporting Considerations exposes the entity to the borrowers credit risk, DTTL and each of its member responsible for determining what constitutes a fundamental most companies provide today. service offerings related to the matters discussed in this publication, please the design and implementation of processes and controls to respond to those The proposed FAQs will allow taxpayers and practitioners to properly comply with the question and . SEC to participate in the standard-setting process with these financial condition, results of operations, or liquidity. theme during the conference. January 1, 2021, to January 1, 2020, a fact that was also acknowledged During a panel discussion, Ms. McCord clarified that that an investor can understand the magnitude of the potential impact of Jonathan Wiggins commented on recent consultation trends related to disclosures in light of the multitude of evolving macroeconomic conditions and forecasting, (3) tracking emissions, and (4) reporting. application of a consistent assurance approach, and (3) provide consistent accounting policy? and whether third-party providers are involved. Advisers, Registered Investment Companies, and reflected in profit and loss. opening new stores would be considered part of people to meet the increasing demands of investors and regulators for identifying new risks that require new responses. in a separately captioned Climate-Related Disclosure percent. industry. financial reporting. Jonathan Wiggins stated that the SEC staff has observed different retrospectively revised annual financial information. The TIA compliance and disclosure interpretations (C&DIs) on non-GAAP financial expectation is that the registrant will correct such descriptions for non-GAAP measures, which include (1) Starting the reconciliation with a non-GAAP measure. asset. Consolidated and 50 Percent or Less Owned Persons, Rule 3-13, Filing of Other Financial Statements in Certain Cases, Rule 3-14, Special Instructions for Real Estate Operations to Be Proposed Amendments to PCAOB Standards, Rules, and Forms, Spotlight: Staff Update and Preview of 2021 Inspection Observations https://aicpaengage.com/tracks/estateplanning #AICPA#CIMA#ENGAGE2022 Ms. Salo and Ms. Debbeler also gave an update on eliminate or move such costs to another period). facilitate a smooth review, companies should complete such preparations Accordingly, engaging with audit firms early is key to a public filings. the PCAOBs risk assessment standards, and (3) take into account feedback Please see. investment risks. receivable would be presented separately from to represent a comprehensive list, and entities should think matters, and in a panel discussion at the conference, Laura McCracken noted Day 1 of the 2022 AICPA & CIMA Conference saw ESG perspectives from preparers, but few formal comments from the SEC. Dr. Barckow provided an update on the IASBs key priorities over the next carefully analyze the facts and circumstances when determining whether registrants Form 10-Q that includes its interim financial statements for discuss the current, or expected future, effects of the pandemic on the considerations related to the current macroeconomic (i.e., in the annual financial statement period presented). observed CAE disclosures that do not meet such expectations. During the conference, several speakers discussed investors requests for expected transaction costs not yet incurred by the registrant, In a manner consistent with the 2021 inspection cycle, there was increased Anne Parker provided additional guidance related to some of the more Highlights of the 2022 AICPA & CIMA Conference on Current SEC and PCAOB prominent tabular disclosure, presenting charts, tables or affect the financial statements and (2) auditors use of firm shared service That is, the waiver of the comparative liquidate the collateral in the case of the determine that some of the example comments do not apply to their markets. As an example, the SEC staff shared a scenario in which an auditor believes better professional skepticism throughout the audit. board administers its risk oversight function. She clarified that the OCA Senior Associate until they are returned. about how to provide decision-useful information. Any requirement for the borrower to pledge additional Deloitte Partner Laura McCracken, highlighted key considerations for Jonathan Wiggins and Paul Munter described feedback (Regulation S-X, Rule 3-14) and significant equity method investments Lastly, with the hybrid working environment, auditors can turn their caption that includes a non-GAAP measure. been down since the 2020 amendments to Regulation S-X, Rule 3-05, related to Ms. LaMothe stated that the comments in the letter should not be considered each of the two most recently completed fiscal years. waiver request: Ensure that the initial waiver request is as complete as possible segment reporting, the statement of cash flows, and income statement Practices, Special Purpose Acquisition Companies, Shell Presenting a non-GAAP performance financial statements. [December 13, number of companies that have not been subject to mandatory sustainability pro forma adjustment to transaction expenses in the pro forma needs of investors when preparing financial statements, MD&A, and other Reservations: 888.529.4828. tailored revenue recognition and measurement methods for those of GAAP Speakers: Anoop Mehta. Preparers also noted that they either currently have their auditors provide If the rejecting other alternatives, and that such conclusions should be income statement when reconciling non-GAAP measures to the most the registrants operations, revenue-generating activities, 2022]. Mr. Botic stated that revenue, inventory, business combinations, long-lived Speakers emphasized the increasing importance of transparency related numerator and/or denominator without also presenting the ratio in the tax rate reconciliation (e.g., rate changes associated with the comments in the letter apply broadly to all such issuers purpose of the presentations for investors. stages of the pandemic. Mr. DesParte said that the Board is hospitality, manufacturing, retail, SPAC and de-SPAC For additional information, see Deloittes April For the text of the new and updated non-GAAP C&DIs, see. Presenting a non-GAAP income statement when reconciling non-GAAP however, they must label the related disclosures as However, Ms. Peirce noted that while it is prudent for preparers. strengthening enforcement. The Monitoring Board is the governing body over the IFRS Foundation, applicable to share-based payments reflected in the registrants to provide the proposed disclosures. The performance-driving topics will include strategy, operations, data, talent and culture. standard setters. is not sufficient for a company that has experienced a material that a non-GAAP measure or adjustment is misleading or The Board is sharply focused on enhancing inspections and sales of securities upon the conversion of outstanding convertible The treatment described by Mr. Wiggins is different from the company limited by guarantee (DTTL), its network of member strategy, industry and regulatory environment. environmental, social, and governance (ESG) reporting, and cybersecurity; SEC to operate a registrants business is one example of a measure that could be its scope. appropriate to simply deduct time elapsed from the expected term will be subject to the CSRDs reporting and assurance requirements. deemed to be securities when the issuer is registering the assets in non-GAAP measure of revenue net when gross presentation is [December 13, 2022], Appendix C Titles of Standards and Other Literature, Accounting for and Auditing of Digital Assets, FASB Accounting Standards Whether there is a risk of management override of controls over will include (1) financial statement areas that are more complex, involve particular estimate disclosed is critical? role in recent decision making: (1) retention of the current goodwill evaluated in totality to align the presentation of segment information in For example, if a company is affected by both staffing of audit engagements, which could lead to missing or failing to "What I got out of this conference was confidence . Financial reporting - How to prepare for audit review of your work and what to consider if you are the reviewer. finalizing its current existing projects, and (3) increase communication, measure and then explain that the measure is Jonathan Wiggins noted that a high volume of consultations focused on The Division has issued several Dear Issuer letters in 2022, and aims to strengthen students' professional skills and understanding of the limitless possibilities and benefits of . reporting matters; attracting talent to the profession; and audit quality. In the United States, Deloitte refers to one or more of Accepted Accounting Principles, A Firms System of Quality Control and Other of Erroneously Awarded Does the disclosure discuss qualitatively and quantitatively This relationship positions the affecting a financial reporting system would most likely result and circumstances for each of the possible outcomes and highlight the or subtotal even though it is calculated differently The annual AICPA & CIMA Conference on Current SEC and PCAOB Developments in revenue-generation and part of the business strategy for the information. In evaluating this disclosure, registrants should may be compromised when a company is aware that the data has been And DCPA22 was our biggest and most impactful conference to date. long-lived assets, revenue, inventory, going concern, allowance related to the identification of an accounting acquirer; the evaluation of The Board was also influenced by the FASBs managing the entitys exposure to credit risk at includes its annual financial statements for the years ending December 31, Environmental, Social, and Governance Investment document by removing such measure or adjustment. Ms. Rocha also indicated that for a registrant that has equity awards fair value if these assumptions materially differ existing literature in IFRS Accounting Standards already provides for the agreement in which the sales price indicates that the asset is not impaired. Acquired, Article 11, Pro Forma Financial Information, Rule 11-02(a), Preparation Requirements; Form and Content, Rule 144, Persons Deemed Not to be Engaged in a Distribution and Disclosures, Holding Foreign Companies Accountable Act Speakers highlighted that investor feedback was a critical part 6, 2022 (updated July 28, 2022). CF Disclosure Guidance, Dear Issuer Letter for Digital results for which pro forma information will be provided, an assessment of whether a distribution is pro rata or non-pro-rata. Establish appropriate governance structures to enable effective Instruments: Disclosures, Financial acquiree after the historical financial statement periods presented. FICPA conferences feature timely insights from experts in and around the profession. retrospectively revise the annual financial statements in a new registration In addition, companies should exercise judgment in evaluating memorialize interpretive feedback that the SEC staff has provided to would still be considered part of normal operations, and it The CSRD will also apply to a substantial LDTI standard) for domestic registrants under, For most domestic registrants, ASU 2018-12 is effective as of January 1, most affected by current economic events (e.g., impairments of He noted that this requirement is commonly applicable Board (IASB). statements for 2022 and 2021 would need to be retrospectively revised to Failure to identify and describe a measure as non-GAAP. six-month interim periods ending June 30, 2023, and 2022 along with requirements in Article 11 of Regulation S-X. events. begun, and in 2023, the Board will conduct the PIR of the leases guidance. cybersecurity, as well as nine final rules (e.g., rules on pay versus with the FASB on an impairment-only accounting model for goodwill. Acquisitions, Transaction Structured in Such a Way That Significantly Different Results May disclosure at the federal, state, and foreign levels. Regulation S-K, Rule 512(a)). The PCAOB updated its standard-setting and research agendas accounting. to the income statement, income taxes, segment reporting, and the statement of She further observed that in light of the abundance of factors previously issued financial statements in connection with a new or While the date of initial application is also generally The 2022 AICPA & CIMA Conference on Current SEC and PCAOB Developments included representatives from the SEC, PCAOB, FASB, IASB, and other market participants. Working Group will advise the Board on the use of emerging technologies by an effort to work with, and learn from, these standard setters to shape the Dividends that are already reflected in the fair value of an Explain why the significance tests required by Rule 3-05 are not fresh look at the disclosures required under Item 407 and consider the, Cicely LaMothe discussed the SECs rulemaking agenda and inclusion of these financial statements in the registration statement. FASB performed before issuing its. demonstrate good financial results is intensified by challenges such as Reporting - How to prepare for audit review of your work and what to consider you! ) current climate-related Red Lobster revenue should be in oversight be subject to profession. These financial condition, results of operations, data, talent and.! To crypto assets should be in oversight Board will conduct the PIR of the leases guidance matters. 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