What’s New in Financial Reporting

Link: https://cfany.gallery.video/fullconference/detail/videos/most-recent/video/6299420346001/what%E2%80%99s-new-in-financial-reporting?autoStart=true

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Description:

Program will bring you up to date with most recent and coming important financial reporting developments for 2022 from FASB. Speakers include two FASB Board members and SEC’s Senior Associate Chief Accountant.

Author(s): multiple presenters

Publication Date: 1 Mar 2022 originally presented, recording accessed 16 Mar 2022

Publication Site: CFA Society of New York

Elizabeth Warren’s War on Accounting

Link:https://www.wsj.com/articles/elizabeth-warren-accounting-standards-corporate-minimum-tax-fasb-reconciliation-taxation-11636921275

Excerpt:

The Democrats’ proposed 15% levy on the world-wide financial-accounting earnings of large, highly profitable companies may sound familiar. It was originally proposed by Sen. Elizabeth Warren during her bid for president. Democrats are pushing this tax again now, hoping it will encourage passage of a $1.85 billion reconciliation bill to fund President Biden’s Build Back Better plan.

Any plan to tax financial-accounting earnings is ill-conceived, as I argued on these pages in May 2019. Blurring the lines between taxable income and financial-accounting profit would inevitably lead to political meddling in financial-accounting rules and damage the usefulness of financial accounting for investors.

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Politicians and the FASB have vastly different objectives. Financial-accounting rules are created by the apolitical FASB to provide information useful to investors. In contrast, tax-accounting rules are largely determined by Congress to achieve such objectives as raising revenue, encouraging or discouraging certain behavior, and redistributing wealth. Two accounting systems are necessary, one for pursuing social objectives through the tax system, the other for giving investors comparable, reliable and timely information. The U.S. is not unique in this regard. Every developed country has a tax-accounting system that is separate from its financial-accounting system.

Because the objectives of the two systems are different, the income they compute is different. 

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If Congress wants to raise more revenue and prevent companies from reporting low tax rates, it should change the tax code. 

Author(s): Scott Dyreng

Publication Date: 14 Nov 2021

Publication Site: Wall Street Journal

Comment letter by TIA Board Member John Kayser on recent GASB Exposure Drafts

Link: https://www.truthinaccounting.org/news/detail/comment-letter-by-tia-board-member-john-kayser-on-recent-gasb-exposure-drafts

Excerpt:

Several months ago, the Governmental Accounting Standards Board (GASB) issued two new Exposure Drafts for proposals that would lead to a new government accounting concept statement and related standard. GASB invited comment on those proposals, a process in which Truth in Accounting participated directly and also encouraged others to participate.

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… The following information is on the State of Illinois, the city of Chicago and the Chicago Public School (“CPS”) system … The severe financial decline in those three entities have not been at all adequately communicated to the various users of the information. The accounting standards and reporting have not required it. Those governmental units are financially unsustainable and their services to their citizens have not been sustained. The financial accounting standards have been fundamentally flawed for decades and border on gross negligence.

… The GASB must have a higher level of accounting standards. There are no independent third parties overseeing their government accountings standards like there is with FASB and nongovernmental entities. The financial and service sustainability of State and local entities are in question. The services they provide are of the utmost importance to the public and their citizenry. … Requiring fund balance accounting using total financial resources focus measurement and accrual basis of accounting is the tool necessary for the political system and the public to successfully address these issues.

Author(s): Bill Bergman, John Kayser

Publication Date: 22 March 2021

Publication Site: Truth in Accounting