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FASB proposes changing income tax disclosure requirements

Published on August 12, 2016

FASB proposed accounting rules Tuesday that would change disclosure requirements for income taxes on organizations' financial statements.

Under the proposal, existing disclosure requirements would change and organizations would be required to provide new disclosures. The proposal would require preparers to: 

Additional disclosures also would be required, with differentiation between requirements for public business entities and other organizations. The proposal is titled Proposed Accounting Standards Update, Income Taxes (Topic 740), Disclosure Framework—Changes to the Disclosure Requirements for Income Taxes.

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What should FASB work on next?

Published on August 12, 2016

FASB is asking for public comment on which financial accounting and reporting topics it should consider adding to its agenda.

The board issued an Invitation to Comment document that explains areas of concern that were identified in a recent survey of FASB’s advisory groups.

After completing major projects in recent years on standards such as revenue recognition, leases, and credit impairment, FASB is seeking input on other areas of accounting and financial reporting that need improvement.

The Invitation to Comment covers areas of concern identified in a recent survey of FASB’s advisory groups. The document discusses potential issues and possible solutions in the following areas: 

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Zero-Based Budgeting Is Not a Wonder Diet for Companies

Published on July 25, 2016

Zero-based budgeting (ZBB) is elegantly logical: Expenses must be justified for each new budget period based on demonstrable needs and costs, as opposed to the more common method of using last year’s budget as your starting point, then adjusting up or down. ZBB is a straightforward, intuitively simple way to aggressively strip out costs that cannot be rationally justified. Who would argue that a business should not eliminate unjustifiable costs?

ZBB has been around for decades, but is currently enjoying a revival driven by powerful investors like 3G Capital Partners, the force behind the 2015 merger of Kraft Foods and H.J. Heinz. Such high-profile exposure has prompted more companies to view ZBB as a fresh “wonder diet” for achieving radical corporate leanness. ZBB’s resurgence is further fueled by the uncertain markets hindering many companies’ efforts to attract fresh capital, as we see venture capital and private equity funds increasingly pushing ZBB on their portfolio companies, in the hope of securing a more rapid and profitable exit on their investments.

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To Hold Someone Accountable, First Define What Accountable Means

Published on July 25, 2016

At the end of a meeting, most leaders know that they should recap next steps and determine who is accountable for each. As prescribed in the commonly used responsibility models — RACI, RAPID, and the others — accountability should fall to one (and only one) person per item, even if the work involved requires input and contributions from others. Unfortunately, over the years we’ve spent advising organizations, we’ve found that the word “accountable” can mean different things to different people.

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Keeping Up with Tech Is Accountants' Biggest Annoyance, Survey Says

Published on July 25, 2016

The biggest technology “annoyance” faced by accountants is keeping up with changing software, according to a recent survey, with security and risk management in second place.

The accountants responding to the recently released Third Annual Accounting Firm Operations and Technology survey also reported several challenges in their day-to-day practice. The biggest one, unchanged from previous years, is workflow efficiency (34 percent). A new category for this year, security, came in second place with 19 percent citing it as their biggest concern. Fourteen percent of respondents indicated that getting clients on board with working with the firm in a more digital way is their biggest challenge.

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How to tackle implementation of multiple high-profile accounting standards

Published on July 25, 2016

A wave of significant accounting standard setting has created heavy compliance burdens that many company finance departments are struggling to handle.

Just 37% of more than 140 companies surveyed by KPMG LLP said they are on the right track in their implementation of the new revenue recognition standard issued by FASB and the International Accounting Standards Board (IASB), which takes effect at the beginning of 2018 for public companies.

Meanwhile, new lease accounting requirements have companies attempting a challenging process of locating all their lease agreements and extracting data points from them that haven’t been necessary for accounting in the past.

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Companies Still Behind on Implementing Revenue Recognition Standard

Published on June 23, 2016

The majority of companies admit they are behind on implementing the new revenue recognition standard from the Financial Accounting Standards Board, according to a new survey, despite a delay of the effective date by one year.

FASB and the International Accounting Standards Board released a long-awaited converged revenue recognition standard in May 2014, but later decided to extend the date it takes effect by one year to give companies more time to implement it.

However, according to a new survey by KPMG LLP of 140 companies, 60 percent of respondents indicated that they are running behind schedule in their overall implementation of the standard, which has an effective date as early as Jan. 1, 2018, for many organizations.

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Phishing, Hacked Passwords Are Top Reasons for Data Breaches

Published on June 23, 2016

Phishing, Hacked Passwords Are Top Reasons for Data Breaches
Verizon released its ninth annual Data Breach Investigations Report last month, which reports on the major security breaches and methods used by hackers to compromise businesses and governmental organizations. When it comes to hacking, organized crime syndicates lead the way with phishing email schemes that are culpable in 89 percent of security breaches, followed by “state-affiliated actors,” which accounted for another 9 percent of attacks.

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Recognizing the Unconventional Keys to Your Company's Success

Published on June 23, 2016

If you want to change something in your company, you start with single-minded attention and promotion. The same applies when trying to replicate more of a good thing. Successful companies, in the constant pursuit of well-rounded teams, look for and find the intangibles that help drive performance. 

Here are three unconventional yet important and under-recognized keys to sustained success: 

Thinking and problem solving.
Are you recognizing independent thinking and problem solving? Great companies have an ability to both retain and promote the right people. They put into action a development plan that instills the right qualities they want in all their current and future leaders. Independent thinking and problem solving are sought-after qualities all companies seek in their leadership teams, yet are often under-coached. In fact, in some organizations, top performers rise rapidly through the ranks without any real challenge to their cognitive abilities. 

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Accountants Rescued by the 'Magnificent Seven'

Published on June 23, 2016

Forget about Yul Brynner, Steve McQueen, Charles Bronson, James Coburn, Robert Vaughn, Horst Buchholz and Brad Dexter. Accountants need a “Magnificent Seven” set of attributes to survive in today’s business environment, according to new research from the Association of Chartered Certified Accountants. 

To define what the 2016 finance professional must look like, the ACCA has developed a set of seven Professional Quotients—a mix of technical knowledge, skills and abilities formed with interpersonal behaviors and qualities. 

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