Financial Reporting & Regulatory Update: Third Quarter 2017

During the third quarter of the 2017 calendar year, the Financial Accounting Standards Board (FASB) issued three standards for an overhaul of hedge accounting, simplification of financial instruments with down round features, and codification of the SEC’s adoption date deferral as well as five proposals related to not-for-profit entities, reorganizing existing consolidation guidance, land easements, and clarifications to the recognition and measurement and lease accounting standards.
 
In addition to the hedging standard, the FASB also issued standards for simplification of financial instruments with down round features, codification of the SEC’s adoption date deferral, and five proposals related to not-for-profit entities, reorganizing existing consolidation guidance, land easements, and clarifications to the recognition and measurement and lease accounting standards.
 
The focus for the Securities and Exchange Commission (SEC) during the quarter was on cyber matters, simplifying the capital formation process, and implementing the new major accounting standards, including a deferral of the adoption of revenue recognition and lease accounting for certain public business entities (PBEs).
 
In a Q&A discussion, FERF spoke with Crowe partner Chris Moore about changes to hedge accounting and the implications for risk management and financial reporting. The hedging update offers simplification, opens the doors to new approaches, and may entice companies that have previously been reluctant to hedge to consider the strategy.