Financial Reporting and Regulatory Update

The quarterly Financial Reporting and Regulatory Update is prepared by the Financial Education & Research Foundation (FERF) in collaboration with Crowe LLP, highlighting pronouncements from the U.S. SEC, FASB, PCAOB, and other regulators and standard-setters. Each update includes ASU Effective Date Checklists for Public and Non-Public Business Entities.

Fourth Quarter 2021

Gaining Inclusivity, Battling Isolation

According to the latest figures, more than 400 special-purpose acquisition companies (SPACs) are now in the market seeking private firms to acquire and take them public.

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Financial Reporting & Regulatory Update, Fourth Quarter 2021

During the fourth quarter of the 2021 calendar year, the Financial Accounting Standards Board (FASB) issued four new accounting standards addressing the following topics:

  • Private company practical expedient for equity-classified share-based awards
  • Accounting for acquired revenue contracts in a business combination
  • Discount rate guidance for lessees
  • Disclosures by business entities about government assistance

The FASB also issued proposals addressing interim disclosure requirements, troubled debt restructurings and vintage disclosures, and supplier finance program disclosures.

The Securities and Exchange Commission (SEC) participated in the annual American Institute of CPAs (AICPA) and Chartered Institute of Management Accountants (CIMA) Conference on Current SEC and Public Company Accounting Oversight Board (PCAOB) Developments; issued statements on independent audits and effective audit committee oversight, London Interbank Offered Rate transition, special purpose acquisition companies, and crypto assets; adopted new proxy rules; issued guidance on spring-loaded executive compensation and shareholder proposals; and proposed amendments to proxy voting advice rules and to increase securities lending market transparency, among other proposals.

The PCAOB adopted a final inspection and investigations rule, issued a preview of 2020 inspection observations, participated in the AICPA-CIMA conference, and announced new board members. The AICPA issued the credit losses audit and accounting guide.

The Center for Audit Quality published its audit committee transparency barometer report.

In addition to these highlights from the quarter, we have included recent developments from the Governmental Accounting Standards Board (GASB).

Checklists for the effective dates of FASB Accounting Standards Updates and GASB statements are provided.