-
Comment letters on Proposed Audit and Accounting Guide "Audits of Brokers and Dealers in Securities"
American Institute of Certified Public Accountants. Stockbrokerage and Investment Banking Committee
-
Proposed audit and accounting guide : audits of brokers and dealers in securities ;Audits of brokers and dealers in securities; Exposure draft (American Institute of Certified Public Accountants), 1994, Aug. 16
American Institute of Certified Public Accountants. Stockbrokerage and Investment Banking Committee
This proposed audit and accounting guide has been prepared to assist preparers of financial statements of broker-dealers in securities and independent auditors in auditing and reporting on those financial statements. Generally accepted accounting principles (GAAP) and generally accepted auditing standards (GAAS) apply to the financial statements of broker-dealers in securities. This proposed guide would supersede the AICPA Audit and Accounting Guide Audits of Brokers and Dealers in Securities, issued in 1985. This proposed guide does not address the general application of those standards; rather, it focuses on special matters unique to auditing and reporting on the financial statements of broker-dealers. The proposed guide describes the conditions or procedures unique to the industry and illustrates the form and content of broker-dealer financial statements and related disclosures. Included are discussions of business activities, accounting records, internal controls and procedures for safeguarding customer assets including securities, and unique aspects of the audit, as well as illustrations of various financial statements and independent auditors' reports; however, detailed internal control questionnaires and audit programs are not included. This proposed guide is a complete revision of the 1985 AICPA Industry Audit Guide Audits of Brokers and Dealers in Securities, including all applicable statements of position issued prior to July 1, 1994. The form of financial reporting of broker-dealers required under GAAP and in accordance with the requirements established by the regulatory or self-regulatory bodies is intended to meet the needs of customers who do business with these securities concerns, the needs of regulatory bodies and lenders, and the needs of stockholders of firms with public ownership. Broker-dealers in securities are subject to regulation under the Securities Exchange Act of 1934. Some broker-dealers are also futures commission merchants for commodity futures and commodity option contracts subject to regulation under the Commodity Exchange Act. The AICPA is preparing an industry audit and accounting guide. Audits of Futures Commission Merchants and Commodity Pools, to provide guidance relating to commodity activities performed by broker-dealers and futures commission merchants. Members of the National Association of Securities Dealers, Inc. (NASD) are subject to the rules of that association, and members of securities exchanges are also subject to the rules of the exchanges of which they are members. Some of these rules, as currently in effect, are discussed in this guide. However, the rules, regulations, practices, and procedures of the securities and commodities futures industries have changed frequently and extensively in recent years. Still further changes are under consideration as this guide goes to press, and the independent auditor should keep abreast of these changes. This publication is a guide in determining the scope and nature of the work for each individual audit. It is not intended to limit or supplant individual judgment, initiative, imagination, and vigilance. Programs for each audit should be designed to meet the requirements of the particular situation, giving consideration to the size and type of organization and its internal control structure; this is a matter that should be determined by the exercise of professional judgment in light of circumstances present in a particular case. Users of this proposed guide should be aware that certain issues affecting broker-dealers in securities have not been included in this guide or are currently under study. Such issues include proposed Financial Accounting Standards Board (FASB) Statements of Financial Accounting Standards, Disclosures About Derivative Financial Instruments and Hedging and Hedge Accounting, and AICPA proposed Statement on Auditing Standards, Using the Work of a Specialist. As these issues are resolved, amendments to the proposed guide may be issued. This proposed guide includes illustrations of the form and content of financial statements for brokers and dealers and the auditor's report thereon.
-
Comment letters on AcSEC's October 27, 1993 exposure draft, Identifying and Accounting for Real Estate Loans that Qualify as Real Estate Investments
American Institute of Certified Public Accountants. Task Force on ADC Arrangements
-
Disclosures of certain matters in the financial statements of insurance enterprises; Statement of position 94-5;
American Institute of Certified Public Accountants. Task Force on Insurance Companies' Disclosures
-
Proposed statement of position : Disclosures of certain matters in the financial statements of insurance enterprises ;Disclosures of certain matters in the financial statements of insurance enterprises; Exposure draft (American Institute of Certified Public Accountants), 1994, Apr. 20
American Institute of Certified Public Accountants. Task Force on Insurance Companies' Disclosures
This proposed statement of position (SOP) requires insurance enterprises, where applicable, to make the following disclosures in their financial statements prepared in conformity with generally accepted accounting principles (GAAP): 1. Information about their regulatory risk-based capital (RBC). 2. The accounting methods used in their statutory financial statements that are permitted by state insurance departments that are not prescribed statutory accounting practices. 3. Information about their liabilities for unpaid property and casualty insurance claims and claim adjustment expenses. The SOP would be effective for financial statements issued for fiscal years ending after December 15, 1994.
-
Reporting on required supplementary information accompanying compiled or reviewed financial statements of common interest realty associations : April 23, 1993, amendment to AICPA audit and accounting guide, Common interest realty associations; Statement of position 93-5;
American Institute of Certified Public Accountants. Accounting and Review Services Committee
-
Proposed Statement of Position: Identifying and Accounting for Real Estate Loans that Qualify as Investments in Real Estate, 6/7/93; Exposure Draft (American Institute of Certified Accountants), 1991, June 7
American Institute of Certified Public Accountants. Accounting Standards Division. Task Force on ADC Arrangements
-
Employers' accounting for employee stock ownership plans; Statement of position 93-6;
American Institute of Certified Public Accountants. Accounting Standards Executive Committee
-
Reporting on advertising costs; Statement of position 93-7;
American Institute of Certified Public Accountants. Accounting Standards Executive Committee
-
Rescission of Accounting Principles Board statements; Statement of position 93-3;
American Institute of Certified Public Accountants. Accounting Standards Executive Committee
-
Comment letters on Proposed SOP, Using the Work of a Specialist
American Institute of Certified Public Accountants. Auditing Standards Board
-
Proposed statement on auditing standards : Using the work of a specialist (supersedes SAS no. 11, Using the work of a specialist);Using the work of a specialist (supersedes SAS no. 11, Using the work of a specialist); Exposure draft (American Institute of Certified Public Accountants), 1993, Apr. 7
American Institute of Certified Public Accountants. Auditing Standards Board
The Auditing Standards Board is considering the issuance of this proposed statement on auditing standards (SAS) to clarify existing guidance for auditors who use the work of a specialist in performing an audit of financial statements in accordance with generally accepted auditing standards. This proposed Statement: 1. Incorporates the conclusions included in the two existing auditing Interpretations of AICPA Professional Standards, volume 1, AU section 336, into the body of the SAS. 2. Clarifies that when a specialist has a relationship to the client and the auditor believes that relationship might impair the specialist's objectivity, the auditor should perform additional procedures. 3. Includes a recommendation of the AICPA Quality Control Inquiry Committee (QCIC) that current standards should address such matters as the qualitative aspects of certain inventories. 4. Clarifies the applicability of the SAS to situations involving the use of tax specialists. 5. Clarifies the applicability of the SAS to all audits of financial statements, not only those prepared in conformity with generally accepted accounting principles. This proposed Statement would supersede SAS No. 11, Using the Work of a Specialist (AICPA, Professional Standards, vol. 1, AU sec. 336), and the two related Interpretations.
-
Proposed statement on standards for attestation engagements : compliance attestation ;Compliance attestation; Exposure draft (American Institute of Certified Public Accountants), 1993, Apr. 7
American Institute of Certified Public Accountants. Auditing Standards Board
The Auditing Standards Board is considering the issuance of this proposed statement on standards for attestation engagements to provide guidance to practitioners who are engaged to perform services related to management's written assertion about an entity's compliance with specified requirements. The proposed Statement provides guidance to assist the practitioner in: 1. Accepting an agreed-upon procedures or examination engagement. 2. Planning the engagement. 3. Obtaining an understanding of the internal control structure over compliance with specified requirements in an examination engagement. 4. Testing the entity's compliance with specified requirements. 5. Reporting on management's assertion. One significant applicability of the proposed guidance relates to auditors of insured depository institutions who perform agreed-upon procedures to test the entity's compliance with specified safety and soundness laws, as required by the Federal Deposit Insurance Corporation Improvement Act of 1991. The proposed Statement would build upon the Statement on Standards for Attestation Engagements Attestation Standards (AICPA, Professional Standards, vol. 1, AT sec. 100).
-
Proposed Content Specifications for the Uniform CPA Examination (Effective May 1996); Exposure Draft (American Institute of Certified Public Accountants) 1993, May 25
American Institute of Certified Public Accountants. Board of Examiners
-
Comment letters received on the exposure draft proposed statement of position, Reporting of Investment Contracts Held by Health and Welfare Benefit Plans and Defined-Contribution Pension Plans
American Institute of Certified Public Accountants. Employee Benefit Plans Committee
-
Proposed statement of position : Reporting of investment contracts held by health and welfare benefit plans and defined-contribution pension plans : (proposed amendment to AICPA Audit and accounting guide Audits of employee benefit plans and SOP 92-6, Accounting and reporting by health and welfare benefit plans, September 15, 1993 ;Reporting of investment contracts held by health and welfare benefit plans and defined-contribution pension plans : (proposed amendment to AICPA Audit and accounting guide Audits of employee benefit plans and SOP 92-6, Accounting and reporting by health and welfare benefit plans, September 15, 1993; Exposure draft (American Institute of Certified Public Accountants), 1993, Sept. 15
American Institute of Certified Public Accountants. Employee Benefit Plans Committee
This proposed statement of position (SOP) would amend chapters 3, 4, and 7 of the AICPA Audit and Accounting Guide Audits of Employee Benefit Plans, with conforming changes as of May 1, 1993 (hereafter referred to as the Guide) and SOP 92-6, Accounting and Reporting by Health and Welfare Benefit Plans. This proposed SOP generally specifies the accounting for health and welfare benefit plans and defined-contribution pension plans for investment contracts issued by either an insurance enterprise or other entity. Defined-contribution plans, including both health and welfare, and pension plans, should report investment contracts with fully benefit responsive features (as defined in the proposed SOP) at contract value and other investment contracts at fair value. Defined-benefit health and welfare benefit plans should report investment contracts at fair value. This proposed SOP also permits health and welfare benefit plans and defined-contribution pension plans to report contracts that incorporate mortality or morbidity risk at contract value. This proposed SOP is effective for financial statements for plan years beginning after December 15, 1993. Accounting changes adopted to conform to the provisions of this proposed SOP should be made as of the beginning of the year in which the change is adopted. The financial statements should disclose the change and the effect of the change on the financial statements. Restatement of financial statements of prior years is not permitted. Language : eng
-
Proposed audit and accounting guide : audits of state and local governmental units ;Audits of state and local governmental units; Exposure draft (American Institute of Certified Public Accountants), 1993, May 17
American Institute of Certified Public Accountants. Government Accounting and Auditing Committee
A significant period of time has elapsed since the publication in 1986 of the AICPA Audit and Accounting Guide, Audits of State and Local Governmental Units. Many changes have taken place in generally accepted auditing standards and their application and regulatory and financial reporting requirements. These changes have created the need for revised guidance. The objectives of this proposed guide are to provide (1) a general background of the government environment, and (2) practical guidance to the practitioner on the accounting, auditing, and financial reporting for state and local governmental units. The exposure draft contains accounting guidance, some of which was in the 1986 Audit and Accounting Guide Audits of State and Local Governmental Units but not addressed in Governmental Accounting Standards Board pronouncements, and some of which is new guidance. For certain of these topics, the guidance provided is "neutral"—that is, the guide presents the alternative accounting possibilities and does not recommend one alternative over another. The final document may or may not recommend a single alternative. In addition, the guide identifies relevant regulations and professional accounting and auditing pronouncements and summarizes key provisions of those regulations and pronouncements. This proposed guide would supersede: 1. The 1986 Audit and Accounting Guide, Audits of State and Local Governmental Units, and all subsequent editions. 2. AICPA Statement of Position (SOP) 92-7, Audits of State and Local Governmental Entities Receiving Federal Financial Assistance.
-
Proposed statement of position : reporting on separately issued summary financial information prepared by state or local governmental units : proposed amendment to the AICPA audit and accounting guide, Audits of state and local governmental units Reporting on separately issued summary financial information prepared by state or local governmental units : proposed amendment to the AICPA audit and accounting guide, Audits of state and local governmental units; Exposure draft (American Institute of Certified Public Accountants), 1993, Feb. 2
American Institute of Certified Public Accountants. Government Accounting and Auditing Committee
This proposed statement of position (SOP) provides reporting guidance for when a state or local governmental unit issues summary financial information in a document that refers to, but does not include, the general-purpose financial statements. It is a proposed amendment to the AICPA Audit and Accounting Guide Audits of State and Local Governmental Units. The recommendations in this proposed SOP are effective for reports issued on or after June 15, 1993.
-
Auditor's consideration of regulatory risk-based capital for life insurance enterprises; Statement of position 93-8;
American Institute of Certified Public Accountants. Insurance Companies Committee
-
Determination, disclosure, and financial statement presentation of income, capital gain, and return of capital distributions by investment companies : February 1, 1993, amendment to AICPA audit and accounting guide, Audits of investment companies ; Statement of position 93-2;
American Institute of Certified Public Accountants. Investment Companies Committee
-
Financial accounting and reporting for high-yield debt securities by investment companies : January 28, 1993, amendment to AICPA Audit and accounting guide, Audits of investment companies; Statement of position 93-1;
American Institute of Certified Public Accountants. Investment Companies Committee
-
Foreign currency accounting and financial statement presentation for investment companies, April 22, 1993: amendment to AICPA Audit and accounting guide, Audits of investment companies; Statement of position 93-4;
American Institute of Certified Public Accountants. Investment Companies Committee
-
Proposed statement of position : Financial reporting for investment partnerships : proposed amendment to AICPA audit and accounting guide Audits of investment companies ;Financial reporting for investment partnerships : proposed amendment to AICPA audit and accounting guide Audits of investment companies; Exposure draft (American Institute of Certified Public Accountants), 1993, Sept. 15
American Institute of Certified Public Accountants. Investment Companies Committee
This proposed statement of position (SOP) would amend the Audit and Accounting Guide Audits of Investment Companies (the Guide) to provide guidance on financial reporting by investment partnerships for disclosures of investments, income, and partners' capital. It would require: 1. Including a list of investments in securities, as illustrated in the guide for management investment companies, with financial statements prepared in accordance with generally accepted accounting principles (GAAP). 2. Presenting a statement of operations in the format illustrated in the Guide. 3. Accounting for performance fees in accordance with partnership agreements and disclosing the amounts of and how such fees are computed.
-
Comment letters on Proposed Statement of Position Accounting for Costs of Activities of Not-for-Profit Organizations and State and Local Governmental Entities That Include Fund Raising
American Institute of Certified Public Accountants. Not-for-Profit Organizations Committee
-
Comment letters received on AcSEC's May 19, 1993 exposure draft, The Application of the Requirements of Accounting Research Bulletins. Opinions of the Accounting Principles Board, and Statements and Interpretations of the Financial Accounting Standards Board to Not-for-Profit Organizations
American Institute of Certified Public Accountants. Not-for-Profit Organizations Committee
-
Proposed statement of position : accounting for costs of materials and activities of not-for-profit organizations and state and local governmental entities that include a fund-raising appeal :(a revision of SOP 87-2, Accounting for joint costs of informational materials and activities of not-for-profit organizations that include a fund-raising appeal);Accounting for costs of materials and activities of not-for-profit organizations and state and local governmental entities that include a fund-raising appeal :(a revision of SOP 87-2, Accounting for joint costs of informational materials and activities of not-for-profit organizations that include a fund-raising appeal); Exposure draft (American Institute of Certified Public Accountants), 1993, Sept. 10
American Institute of Certified Public Accountants. Not-for-Profit Organizations Committee
This proposed statement of position (SOP) would supersede SOP 87-2, Accounting for Joint Costs of Informational Materials and Activities of Not-for-Profit Organizations That Include a Fund-Raising Appeal. The scope of this proposed SOP would be broader than the scope of SOP 87-2, because this proposed SOP would apply to all not-for-profit organizations (NPOs) and state and local governmental entities that report expenses or expenditures by function. It would amend the following, which include guidance for accounting for the costs of informational materials and activities that include a fund-raising appeal: 1. AICPA Industry Audit Guide Audits of Voluntary Health and Welfare Organizations; 2. SOP 78-10, Accounting Principles and Reporting Practices for Certain Nonprofit Organizations; 3. AICPA Audit and Accounting Guide Audits of Certain Nonprofit Organizations. Also, it would be applied by all not-for-profit organizations and state and local governmental entities in determining fund-raising costs. This proposed SOP sets forth the following: 1. The costs of all materials and activities that include a fund-raising appeal should be reported as fund-raising costs, including costs that are otherwise clearly identifiable with program or management and general functions, unless a bona fide program or management and general function has been conducted in conjunction with the appeal for funds. 2. If a bona fide program or management and general function has been conducted in conjunction with an appeal for funds, the joint costs of those activities should be allocated. Costs that are clearly identifiable with fund-raising, program, or management and general functions should be charged to that cost objective. 3. Criteria of purpose, audience, and content must be met in order to conclude that a bona fide program or management and general function has been conducted in conjunction with the appeal for funds. (The flowchart in Appendix B on page 29 illustrates the decision-making process for applying the conclusions in the SOP.) 4. Some commonly used and acceptable allocation methods are described and illustrated though no methods are prescribed or prohibited. 5. Certain information must be disclosed if joint costs are allocated. The proposed SOP would be effective for financial statements for years beginning on or after its issuance date. Earlier application would be encouraged in fiscal years for which financial statements have not been issued.
-
Proposed statement of position : Reporting of related entities by not-for-profit organizations;Reporting of related entities by not-for-profit organizations; Exposure draft (American Institute of Certified Public Accountants), 1993, May 19
American Institute of Certified Public Accountants. Not-for-Profit Organizations Committee
This proposed statement of position (SOP) amends and makes uniform the guidance concerning reporting related entities in the following AICPA publications: 1. Industry Audit Guide Audits of Voluntary Health and Welfare Organizations; 2. Industry Audit Guide Audits of Colleges and Universities; 3. SOP 78-10, Accounting Principles and Reporting Practices for Certain Nonprofit Organizations; 4. Audit and Accounting Guide Audits of Certain Nonprofit Organizations. The conclusions in this proposed SOP are based on the premise that (1) whether the financial statements of a reporting not-for-profit organization and those of one or more other not-for-profit or for-profit entities should be consolidated and (2) the extent of disclosure that should be required, if any, if consolidated financial statements are not presented should be based on the nature of the relationship between the entities. The guidance in this proposed SOP focuses on (1) investments in for-profit entities and (2) financially interrelated not-for-profit organizations. That guidance includes the following: A. Investments in For-Profit Entities: 1. A reporting not-for-profit organization should include in its consolidated financial statements the financial position and results of operations of a for-profit entity in which it has a majority ownership interest if the guidance in Accounting Research Bulletin (ARB) No. 51, as amended by Financial Accounting Standards Board (FASB) Statement of Financial Accounting Standards No. 94, requires consolidation. The manner in which the for-profit entity's financial position and results of operations are presented in the reporting organization's financial statements depends on the nature of the activities of the for-profit entity. 2. Except as specified below, a reporting not-for-profit organization should use the equity method in conformity with Accounting Principles Board (APB) Opinion No. 18 to report an investment in a for-profit entity in whose voting common stock it has a 50 percent or less voting interest, if the guidance in that Opinion would require the use of the equity method. 3. Some AICPA audit guides applicable to some not-for-profit organizations permit investment portfolios to be reported at market value. Not-for-profit organizations that choose to report investment portfolios at market value in conformity with AICPA audit guides may continue to do so instead of reporting those investments by the equity method, which would otherwise be required by this proposed SOP. B. Financially Interrelated Not-for-Profit Organizations: 1. A not-for-profit organization that owns more than 50 percent of the outstanding voting shares of another not-for-profit organization should consolidate that other organization unless control is likely to be temporary or does not rest with the majority owner, as discussed in paragraph 13 of FASB Statement No. 94. 2. A not-for-profit organization should consolidate the financial statements of another not-for-profit organization if the reporting not-for-profit organization has both control of the other not-for-profit organization, as evidenced by either majority ownership or a majority voting interest in the board of the other not-for-profit organization, and an economic beneficial interest in the other not-for-profit organization, unless control is likely to be temporary or does not rest with the majority owner, as discussed in paragraph 13 of FASB Statement No. 94. 3. A not-for-profit organization may exercise control of a separate not-for-profit organization in which it has an economic beneficial interest by means other than majority ownership or a majority voting interest in the board of the other not-for-profit organization. In such circumstances, the not-for-profit organization is permitted, but not required, to consolidate the financial statements of the other not-for-profit organization, subject to the exception in the previous bullet. If consolidated financial statements are not presented, the not-for-profit organization should make the financial statement disclosures specified in paragraph 33. 4. If either (but not both) control or an economic beneficial interest exists, the financial statement disclosures required by FASB Statement No. 57, Related Party Disclosures, should be made. The conclusions in this proposed SOP will be reconsidered when the FASB completes its project on consolidations and related matters, which may affect the definition of control and other related matters. This proposed SOP is effective for fiscal years beginning on or after its date of issuance, with earlier application encouraged. Comparative financial statements for earlier periods included with those for the period in which this proposed SOP is adopted should be restated.
-
Proposed statement of position : the application of the requirements of accounting research bulletins, opinions of the Accounting Principles Board, and statements and interpretations of the Financial Accounting Standards Board to not-for-profit organizations;Application of the requirements of accounting research bulletins, opinions of the Accounting Principles Board, and statements and interpretations of the Financial Accounting Standards Board to not-for-profit organizations; Exposure draft (American Institute of Certified Public Accountants), 1993, May 19
American Institute of Certified Public Accountants. Not-for-Profit Organizations Committee
This proposed statement of position (SOP) would provide guidance on the application of Accounting Research Bulletins (ARBs), Opinions of the Accounting Principles Board (APB) of the American Institute of Certified Public Accountants (AICPA), and Statements and Interpretations of the Financial Accounting Standards Board (FASB) to not-for-profit organizations. This proposed SOP provides that not-for-profit organizations should follow the guidance in effective provisions of ARBs, APB Opinions, and FASB Statements and Interpretations except for specific pronouncements that explicitly exempt not-for-profit organizations. Also, it includes interpretive comments concerning the application of certain pronouncements.
-
Comment letters on exposure draft Omnibus Proposal of Professional Ethics Division Interpretations and Rulings
American Institute of Certified Public Accountants. Professional Ethics Executive Committee
-
Omnibus proposal of Professional Ethics Division interpretations and rulings; Exposure draft (American Institute of Certified Public Accountants), 1993, May 19
American Institute of Certified Public Accountants. Professional Ethics Executive Committee
1. PROPOSED INTERPRETATION UNDER RULE 101: Independence and Cooperative Arrangements With Clients; 2. PROPOSED ETHICS RULING UNDER RULE 101: Indemnification Clause in Engagement Letters; 3. PROPOSED ETHICS RULING UNDER RULE 101: Agreement With Attest Client to Use ADR Techniques; 4. PROPOSED ETHICS RULING UNDER RULE 101: Commencement of ADR Proceeding; 5. PROPOSED ETHICS RULING UNDER RULE 101: Auditors Performance of Certain Internal Audit Services; 6. PROPOSED ETHICS RULING UNDER RULE 101: Members Loan From a Nonclient Subsidiary of an Attest Client Parent Company; 7. PROPOSED REVISION OF INTERPRETATION 101-9 UNDER RULE 101: The Meaning of Certain Independence Terminology and the Effect of Family Relationships on Independence; 8. PROPOSED REVISION OF ETHICS RULING NO. 60 UNDER RULE 101: Employee Benefit Plans—Members Relationships With Participating Employer(s); 9. PROPOSED REVISION OF ETHICS RULING NO. 67 UNDER RULE 101: Servicing of Loan; 10. PROPOSED DELETION OF RULING NO. 13 UNDER RULE 101: Member as Bank Stockholder; 11. PROPOSED INTERPRETATION UNDER RULE 102: Obligations of a Member to His or Her Employers External Accountant; 12. PROPOSED INTERPRETATION UNDER RULE 102: Subordination of Judgment by a Member; 13. PROPOSED INTERPRETATION UNDER RULE 203: Responsibility of Employees for the Preparation of Financial Statements in Conformity With GAAP; 14. PROPOSED ETHICS RULING UNDER RULE 301: Disclosure of Confidential Client Information to Professional Liability Insurance Carrier; 15. PROPOSED REVISION OF ETHICS RULING NO. 158 UNDER RULE 505: Operation of Separate Data Processing Business by a Public Practitioner; 16. PROPOSED DELETION OF ETHICS RULING NO. 180 UNDER RULE 505: Side Businesses Which Offer Services of a Type Performed by CPAs
-
Comment letters on Performing and Reporting on Off-Site Quality Reviews
American Institute of Certified Public Accountants. Quality Review Executive Committee
-
Proposed amendments to standards for performing and reporting on quality reviews : performing and reporting on off-site quality reviews;Performing and reporting on off-site quality reviews; Exposure draft (American Institute of Certified Public Accountants), 1993, Jun. 15
American Institute of Certified Public Accountants. Quality Review Executive Committee
The Quality Review Executive Committee (QREC) is considering the issuance of these proposed amendments to the Standards for Performing and Reporting on Quality Reviews to enhance on-site and off-site quality reviews and eliminate some of the differences between the two types of reviews. The proposed amendments would bring about significant changes in the performance and reporting on quality reviews. The proposed amendments: 1. Allow associations of CPA firms to arrange and carry out off-site quality reviews in the same manner as they arrange and carry out on-site quality reviews. 2. Require all individuals performing on-site and off-site quality reviews (a) to be currently active in the practice of public accounting (b) to have five years of recent experience in the accounting and/or auditing function of a firm enrolled in one of the AICPA practice-monitoring programs, and (c) to have attended an applicable reviewer's training course. 3. Require letters of comments to be issued in conjunction with off-site quality review reports so reviewers can more easily report on deficiencies detected during the review. These letters of comments also provide reviewers the opportunity to make useful recommendations for correcting the deficiencies detected. 4. Allow the AICPA Quality Review Executive Committee to report certain matters to the AICPA Professional Ethics Division for investigation and disposition. 5. Define "substandard engagements" for purposes of the quality review program. These proposed amendments would revise and add to the existing Standards. For purposes of this exposure draft, the language to be revised is shown with a line drawn through it and the new language is presented in boldface italics. The proposed amendments are expected to become effective with quality reviews conducted on or after April 1, 1994.
-
Comment letters on Proposed Statements on Responsibilities in Personal Financial Planning Practice: Working With Other Advisers and Implementation Engagement Functions and Responsibilities
American Institute of Certified Public Accountants. Statements on Responsibilities in PFP Practice Subcommittee
-
Proposed statements on responsibilities in personal financial planning practice : Working with other advisers : Implementation engagement functions and responsibilities;Working with other advisers;Implementation engagement functions and responsibilities; Exposure draft (American Institute of Certified Public Accountants), 1993, May 10
American Institute of Certified Public Accountants. Statements on Responsibilities in PFP Practice Subcommittee and American Institute of Certified Public Accountants. Personal Financial Planning Executive Committee
These proposed Statements on Responsibilities in Personal Financial Planning Practice (SRPFPs) are intended to provide guidance to members of the AICPA who perform personal financial planning services. The proposed SRPFPs are advisory and do not constitute enforceable technical standards under rule 202 of the AICPA Code of Professional Conduct. The proposed SRPFPs do not supersede Statements on Standards for Accounting and Review Services, Statements on Responsibilities in Tax Practice, the Personal Financial Statements Guide, or the Guide for Prospective Financial Statements. The issuance of these exposure drafts was approved by the PFP Executive Committee. Working With Other Advisers This proposed SRPFP provides guidance to CPAs who use the advice of other advisers or refer a client to other advisers in connection with personal financial planning engagements. It provides guidance on engagement scope limitations, selecting other advisers, using advice provided by other advisers, and recommending other advisers to clients. The proposed SRPFP recommends that CPAs disclose limitations that have been placed on the scope of engagements. Sample disclosures are contained in the proposed SRPFP. Implementation Engagement Functions and Responsibilities This proposed SRPFP defines implementation as taking action on personal financial planning decisions, explains how CPAs may assist in implementation, and indicates that implementation is typically completed when all recommended products are acquired or services rendered. The proposed SRPFP provides guidance on planning implementation engagements, communicating with clients, establishing selection criteria, participating in the selection process, and implementing planning decisions developed by others. The proposed SRPFP recommends that CPAs disclose the limitations that have been placed on the information used or the work performed in developing recommendations and contains a sample disclosure. The appendixes to the proposed SRPFP include a flowchart explaining how CPAs might assist in implementation and illustrations of situations in which a CPA has been engaged by a client to implement personal financial planning decisions to purchase disability insurance and to invest funds for postretirement needs.
-
Proposed statement of position : Identifying and accounting for real estate loans that qualify as real estate investments;Identifying and accounting for real estate loans that qualify as real estate investments; Exposure draft (American Institute of Certified Public Accountants), 1993, Oct. 27
American Institute of Certified Public Accountants. Task Force on ADC Arrangements
This proposed statement of position (SOP) applies to all entities that make or acquire real estate loans. It provides guidance on identifying and accounting for real estate loans that qualify as real estate investments for financial reporting purposes. Such loans may include real estate acquisition, development, and construction (ADC) loans, loans on operating real estate, convertible mortgages, and shared appreciation (participating) mortgages. It requires real estate loans that do not meet certain criteria to be classified and accounted for as real estate investments. For purposes of applying this proposed SOP, a loan classified and accounted for as a real estate investment is considered the equivalent of an investment by the lender in a hypothetical partnership, the assets of which include the subject real estate. This proposed SOP does not apply to (1) troubled debt restructurings, foreclosures, or in-substance foreclosures relating to real estate loans accounted for as loans using the criteria set forth in this proposed SOP, (2) debtors, (3) real estate loans resulting from the lender's sale of real estate, (4) permanent mortgage real estate loans on one-to four-family residential properties, or (5) small real estate loans evaluated for impairment by the lender in the aggregate. The proposed SOP supersedes the guidance in the February 10, 1986, AICPA Notice to Practitioners, ADC Arrangements (the third Notice), which was carried forward in the AICPA Accounting Standards Executive Committee (AcSEC) Practice Bulletin 1, Purpose and Scope of AcSEC Practice Bulletins and Procedures for Their Issuance. This proposed SOP should be applied to real estate loans entered into or purchased after December 31, 1994. Earlier application is encouraged. The following highlights significant differences between the provisions of the proposed SOP and the third Notice. The proposed SOP clarifies the scope by stating that it applies to all entities that make or acquire real estate loans. The proposed SOP incorporates the consensus reached in the Financial Accounting Standards Board (FASB) Emerging Issues Task Force (EITF) Issue No. 86-21, Application of the AICPA Notice to Practitioners Regarding Acquisition, Development, and Construction Arrangements to Acquisition of an Operating Property, that extends the concepts of the third Notice to operating properties. The third Notice applies to ADC arrangements in which the lender participates in expected residual profits from the underlying real estate project. The proposed SOP's primary focus is on the assumption of risk. In this regard, while the presence of an expected residual sharing arrangement typically will coincide with classifying a loan as an investment in real estate, it is not a specific criterion for determining the classification. Both the third Notice and the proposed SOP refer to a borrower's equity investment that is "substantial" to the project. Among other revisions, the proposed SOP clarifies that substantial should be evaluated in terms of the minimum initial investment tests described in FASB Statement of Financial Accounting Standards No. 66, Accounting for Sales of Real Estate. The proposed SOP, similar to the third Notice, provides that a loan initially classified as an investment may be reclassified as a loan if one or more of the loan characteristics in paragraph 12 of the proposed SOP are met. However, unlike the third Notice, the proposed SOP does not permit or require reclassification from loans to investments unless the underlying loans are renegotiated in other than a troubled debt restructuring.
-
Comment letters on Proposed Statement of Position: Disclosure of certain Significant Risks and Uncertainities and Financial Flexibilityrt
American Institute of Certified Public Accountants. Task Force on Risks and Uncertainties
-
Proposed statement of position : Disclosure of certain significant risks and uncertainties and financial flexibility;Disclosure of certain significant risks and uncertainties and financial flexibility; Exposure draft (American Institute of Certified Public Accountants), 1993, Mar. 31
American Institute of Certified Public Accountants. Task Force on Risks and Uncertainties
This proposed statement of position (SOP) would require all reporting entities (including business enterprises, not-for-profit organizations, and state and local governments) that prepare financial statements in conformity with generally accepted accounting principles to include in their financial statements disclosures about: 1. The nature of their operations. 2. Use of estimates in the preparation of financial statements. In addition, if specified disclosure criteria are met, it would require such entities to include in their financial statements disclosures about: 1. Certain significant estimates. 2. Current vulnerability due to concentrations. 3. Financial flexibility. The provisions of this proposed SOP would be effective for financial statements issued for fiscal years ending after December 15,1994, and for financial statements for interim periods in fiscal years subsequent to the year for which the proposed SOP is first applied. Early application is encouraged but not required.
-
Comment letters on proposed SOP, Reporting on Required Supplementary Information Accompanying Compiled or Review Financial Statements of Common Interest Realty Associations
American Institute of Certified Public Accountants. Accounting and Review Services Committee
-
Proposed statement of position : reporting on required supplementary information accompanying compiled or reviewed financial statements of common interest realty associations : proposed supplement to the AICPA audit and accounting guide, Common interest realty associations;Reporting on required supplementary information accompanying compiled or reviewed financial statements of common interest realty associations : proposed supplement to the AICPA audit and accounting guide, Common interest realty associations; Exposure draft (American Institute of Certified Public Accountants), 1992, Oct. 26
American Institute of Certified Public Accountants. Accounting and Review Services Committee
The AICPA Audit and Accounting Guide Common Interest Realty Associations (the CIRA guide) requires common interest realty associations (CIRAs) to disclose certain supplementary information outside of the basic financial statements. This requirement also applies to nonpublic CIRAs whose financial statements are compiled or reviewed in accordance with Statements on Standards for Accounting and Review Services (SSARSs). Paragraph 43 of SSARS No. 1, Compilation and Review of Financial Statements, describes the accountant's responsibility when the financial statements are accompanied by information voluntarily presented for supplementary analysis purposes; however, SSARSs do not address the accountant's responsibility when the financial statements are accompanied by required supplementary information. This proposed SOP augments chapter 8, "Review and Compilation Engagements," of the CIRA guide by providing accountants with performance and reporting guidance when required supplementary information accompanies the basic financial statements in compilation and review engagements. The proposed SOP: 1. Requires that the accountant, at a minimum, compile the required supplementary information accompanying compiled or reviewed financial statements. 2. Specifies the procedures that should be performed when compiling the required supplementary information. 3. Refers the accountant to the Statement on Standards for Attestation Engagements, Attestation Standards (AICPA, Professional Standards, vol. 1, AT sec. 100) for guidance on reviewing the required supplementary information.
-
Proposed statement on standards for accounting and review services : omnibus statement on standards for accounting and review services--1992;Omnibus statement on standards for accounting and review services--1992; Exposure draft (American Institute of Certified Public Accountants), 1992, March 18
American Institute of Certified Public Accountants. Accounting and Review Services Committee
The Accounting and Review Services Committee is issuing this proposed statement on standards for accounting and review services (SSARS) to provide practitioners with improved guidance on compiling or reviewing an entity's financial statements. This proposed Statement amends various sections of SSARSs. Among the more significant provisions of the proposed Statement are amendments that: 1. Revise the wording of the SSARS review and compilation reports to clarify that the standards referred to in these reports are Statements on Standards for Accounting and Review Services. The revised wording will help readers differentiate the SSARS review report from the review report presented in Statement on Auditing Standards (SAS) No. 36, Review of Interim Financial Information (AICPA, Professional Standards, vol. 1, AU section 722). 2. Make obtaining a client representation letter a required, rather than an optional, procedure when performing a review engagement. 3. Eliminate the prohibition against merely typing or reproducing financial statements as an accommodation to a client. Guidance on this subject is now subsumed by Interpretation No. 16 of SSARS No. 1, "Determining If the Accountant Has 'Submitted' Financial Statements Even When Not Engaged to Compile or Review Financial Statements." 4. Delete SSARS No. 5, Reporting on Compiled Financial Statements, because the provisions of that Statement have been incorporated into SSARS Nos. 1, 2, and 3. This proposed Statement supersedes SSARS No. 1, paragraphs 1, 4, 7, 8,14,17, 21, 31, 32, 35, 36, 40, 44, 45, 46, 47, 48, 49, and Appendixes B, C, and D; SSARS No. 2, paragraphs 9, 10, and 30; SSARS No. 3, paragraph 3; and SSARS No. 4, paragraphs 1 and 3. It deletes SSARS No. 5.
-
Accounting for foreclosed assets; Statement of position 92-3;
American Institute of Certified Public Accountants. Accounting Standards Executive Committee
-
Comment letters on Proposed SOP on Accounting for ESOPs
American Institute of Certified Public Accountants. Accounting Standards Executive Committee
-
Comment letters received on the June 22, 1992, exposure draft, Reporting on Advertising Costs
American Institute of Certified Public Accountants. Accounting Standards Executive Committee
-
Proposed statement of position : accounting for the results of operations of foreclosed assets held for sale;Accounting for the results of operations of foreclosed assets held for sale; Exposure draft (American Institute of Certified Public Accountants), 1992, Nov. 10
American Institute of Certified Public Accountants. Accounting Standards Executive Committee
Statement of Position (SOP) 92-3, Accounting for Foreclosed Assets, deals with the measurement of foreclosed assets after foreclosure. This proposed SOP provides guidance on accounting for the results of operations of foreclosed assets held for sale. It applies to all reporting entities except those that account for assets at fair value. It applies to all assets obtained through foreclosure that are considered held for sale, except for inventories, marketable equity securities, and real estate previously owned by the lender and accounted for under FASB Statement No. 67, Accounting for Costs and Initial Rental Operations of Real Estate Projects. It does not apply to in-substance-foreclosed assets. This proposed SOP recommends the following: 1. Depreciation expense should be recognized on depreciable foreclosed assets held for sale commencing no later than one year after foreclosure. 2. The net of revenues and expenses related to operating or holding foreclosed assets held for sale should be credited or charged to income as a gain or loss on holding the assets.
-
Proposed statement of position : employers' accounting for employee stock ownership plans ;Employers' accounting for employee stock ownership plans; Exposure draft (American Institute of Certified Public Accountants), 1992, Dec. 21
American Institute of Certified Public Accountants. Accounting Standards Executive Committee
This proposed statement of position (SOP) would supersede AICPA SOP 76-3, Accounting Practices for Certain Employee Stock Ownership Plans, which was issued in December 1976. Since SOP 76-3 was issued, the reporting of transactions between employers and employee stock ownership plans (ESOPs) has become a source of accounting controversy. The importance of employers' financial reporting for ESOPs grew with increases in the number of plans and the amounts of stock held by the plans over the past decade. Furthermore, there have been significant changes in the tax and regulatory environment surrounding ESOPs and the structure and purpose of ESOPs have become more complex and diverse. Those developments called attention to the limitations of SOP 76-3, and therefore, the Accounting Standards Executive Committee (AcSEC) initiated a project to reconsider SOP 76-3, to consider ESOP reporting issues that are not specifically addressed in the accounting literature, and to develop principles for employers' financial reporting of ESOP transactions that provide more relevant and useful information. This proposed SOP, which provides guidance on employers' accounting for ESOPs, is a result of that project. It would apply to all employers with ESOPs, both leveraged and nonleveraged. The proposed SOP would bring about significant changes in the way employers report transactions with leveraged ESOPs. It recommends the following: 1. Employers would report the issuance of new shares or the sale of treasury shares to the ESOP when the issuance or sale occurs and would report a corresponding charge to unearned compensation, a contra-equity account. 2. For ESOP shares committed to be released to compensate employees directly, employers would recognize compensation cost equal to the fair value of the shares committed to be released. 3. For ESOP shares committed to be released to settle or fund liabilities for other employee benefits, such as an employer's match of employees' 401 (k) contributions or an employer's obligation under a formula profit-sharing plan, employers would report satisfaction of the liabilities when the shares are committed to be released to settle the liabilities. Compensation cost and liabilities associated with providing such benefits to employees would be recognized the way they would be if an ESOP had not been used to fund the benefit. 4. For ESOP shares committed to be released to replace dividends on allocated shares used for debt service, employers would report satisfaction of the liability to pay dividends when the shares are committed to be released for that purpose. 5. Employers would credit unearned compensation as the shares are committed to be released based on the cost of the shares to the ESOP. The difference between the amount reported based on the fair value of the shares and the amount credited to unearned compensation would be charged or credited to additional paid-in capital. 6. Employers would charge dividends on allocated ESOP shares to retained earnings. Employers would report dividends on unallocated shares as a reduction of debt or accrued interest or as compensation cost, depending on whether the dividends are used for debt service or paid to participants. 7. Employers would report redemptions of ESOP shares as purchases of treasury stock. 8. Employers would report loans from outside lenders to ESOPs as liabilities on their balance sheets and would report interest cost on the debt. Employers with internally leveraged ESOPs would not report the loan receivable from the ESOP as an asset and would not report the ESOP's debt as a liability. 9. For earnings-per-share computations, ESOP shares that have been committed to be released would be considered outstanding. ESOP shares that have not been committed to be released would not be considered outstanding. The proposed SOP, although it would not change the existing accounting for nonleveraged ESOPs, contains guidance for nonleveraged ESOPs. The proposed SOP also addresses issues concerning pension reversion ESOPs, ESOPs that hold convertible preferred stock, and terminations, as well as issues related to accounting for income taxes. The proposed SOP would be effective for fiscal years ending after December 15,1993. Employers would be required to apply the provisions of the proposed SOP to shares purchased by ESOPs after September 23, 1992, that have not been committed to be released as of the beginning of the year of adoption. Employers would be permitted, but not required, to apply the provisions of the proposed SOP to shares purchased by ESOPs on or before September 23, 1992, that have not been committed to be released as of the beginning of the year of adoption. However, all employers with ESOPs would be required to make the applicable disclosures in paragraph 54 of the proposed SOP.
-
Proposed statement of position : Reporting on advertising costs;Reporting on advertising costs; Exposure draft (American Institute of Certified Public Accountants), 1992, Jun. 22
American Institute of Certified Public Accountants. Accounting Standards Executive Committee
This proposed statement of position (SOP) provides guidance on financial reporting on advertising costs. The proposed SOP requires the following: 1. Reporting the costs of all advertising as expenses in the periods in which those costs are incurred, or the first time the advertising takes place, unless the advertising is direct-response advertising that results in probable future economic benefits (future benefits); 2. Reporting the costs of the future benefits of direct-response advertising as assets; 3. Amortizing the amounts reported as assets over the estimated period of the benefits. Also, this proposed SOP requires disclosure of certain information if the future benefits of direct-response advertising are reported as assets. This proposed SOP would amend the following AICPA statements of position: 1. SOP 88-1, Accounting for Developmental and Preoperating Costs, Purchases and Exchanges of Take-off and Landing Slots, and Airframe Modifications, paragraph 22; 2. SOP 89-5, Financial Accounting and Reporting by Providers of Prepaid Health Care Services, paragraph 55; 3. SOP 90-8, Financial Accounting and Reporting by Continuing Care Retirement Communities This proposed SOP would be effective for financial statements for years beginning approximately one year after its issuance date. Earlier application would be encouraged in fiscal years for which financial statements have not previously been issued. Costs incurred before initial application of this SOP, regardless of whether or not they are reported as assets, should not be adjusted to the amounts that would have been reported as assets had this SOP been in effect when those costs were incurred. However, the concepts included in the provisions of paragraphs 40 and 41 (amortization), paragraph 42 (net-realizable-value test), and paragraphs 43 and 44 (disclosures) should be applied to any unamortized costs reported as assets before initial application of this proposed SOP that continue to be reported as assets after the effective date. In the year in which this proposed SOP is first applied, the financial statements should disclose the nature of the accounting changes adopted to conform to the provisions of this proposed SOP, and their effect on income before extraordinary items, net income, and related per share amounts.
-
Proposed statement of position : Rescission of Accounting Principles Board statements ;Rescission of Accounting Principles Board statements; Exposure draft (American Institute of Certified Public Accountants), 1992, Jul. 20
American Institute of Certified Public Accountants. Accounting Standards Executive Committee
This proposed statement of position (SOP) would formally rescind Accounting Principles Board (APB) Statements 1 through 4, which do not have standing as rules or standards required to be observed by members of the Institute by rule 203 of the Code of Professional Conduct and have been substantially superseded by subsequent pronouncements of the Financial Accounting Standards Board. THIS PROPOSED SOP WILL NOT AFFECT APB OPINIONS, WHICH ARE SEPARATE AND DISTINCT FROM APB STATEMENTS.
-
Comment letters on Proposed Statement on Standards for Attestation Engagements Reporting on an Entity’s Internal Control Structure Over Financial Reporting
American Institute of Certified Public Accountants. Auditing Standards Board