Feb 04, 2013

Private Company Accounting Standards: Moving at Lightning Speed

By Allison M. Henry, CPA, CGMA, PICPA Vice President - Professional & Technical Standards

AICPA’s FRF for SME Task Force achieved a major milestone on Jan. 30 with the conclusion of the comment period for its first draft of the Financial Reporting Framework for Small-and Medium-Sized Entities. The final version will be influenced by individuals and organizations who took the time to respond. The responses are varied and point to the need for extensive education and marketing. The success of the new framework depends how widely it is understood and accepted. To contribute to its success, PICPA’s A&A Committee spent a considerable amount of time working through the draft framework and providing comments to help ensure high quality for the final framework so it is broadly accepted and implemented. Many weighty issues were discussed. For example, should the framework retain the rules–based approach to leases? What is fair value? Should the framework permit financial reporting options? What is the default framework?

The AICPA is firmly behind this effort. It has created numerous resources to explain it, and have begun to market the new framework. Those who are looking forward to the final project won’t have to wait long. The final version is expected in the first half of 2013. Stay tuned.

Listen in as Bob Durak, Director, Private Company Financial Reporting, discusses the Financial Reporting Framework for Small- and Medium-Sized Entities.

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Statements of fact and opinion are the authors’ responsibility alone and do not imply an opinion on the part of PICPA officers or members. The information contained in herein does not constitute accounting, legal, or professional advice. For professional advice, please engage or consult a qualified professional.