Genuine Learning Blog
The Genuine Learning Blog is a video series designed to keep you abreast of the latest developments in accounting and auditing. This is a not a teaser, marketing tool. This blog breaking down new proposals from GASB, FASB, and the AICPA into short manageable videos. Watching this series will make you better informed than your peers!
OMB has issued its 2022 Compliance Supplement. While originally promised in April of 2022, OMB issued it on May 12 which is much better than the previous years that were issued in August. The Compliance Supplement includes new ARPA programs that were not addressed in the 2021 Supplement so this can be very helpful to auditors wrapping up some outstanding 2021 audits. The Supplement should be used for 6/30/22 year ends and beyond.
The PCAOB has issued a staff spotlight looking at some auditor considerations when using a service provider in the confirmation process. It encourages auditors to evaluate whether they have maintained control over the confirmation and to what extent they can rely on third party controls. This is nonauthoritative guidance to help improve audit quality.
FASB has issued a proposal to amend the sunset provision in ASU 2020-04 due to the extension of LIBOR into 2024. In addition, it has proposed to expand the definition of SOFR due to market changes. Comments are due June 6.
OMB has updated the 2021 Compliance Supplement for two programs – Provider Relief Funds and Coronavirus State and Local Fiscal Recovery Funds. DHHS can remove the special test & provisions requirements for Provider Relief Funds (93.498) which related to out of network patient expenses. In order to reduce burden on smaller entities, the Treasury is now offering an alternative examination engagement in lieu of requiring a Program Specific Audit or Single Audit for entities that would not have required this level of audit had it not been for the receipt of CSLFRF funds (21.027). Treasury estimates 10,000 entities will be able to forego a Single Audit in lieu of this new compliance examination which has been added to Appendix VII thereby still maintaining accountability but reducing costs and complexity.
The AICPA has proposed significant changes to AU-C 600 and the requirements of a group audit. Some changes are definitional but the new standard also includes a more risk based approach for addressing financial statements that contain multiple components. Comments are due June 21, 2022.
The first quarter of 2022 has come to an end. It brought with it the publication of four ethics interpretations, two final ASUs, and two proposed SASes. This blog will provide you with what was issued and proposed in Q1 of 2022.
On March 9, President Biden issued an executive order encouraging the federal government to research and respond to the use of digital assets including cryptocurrency. It goes so far as to ask the Federal Reserve to research a Central Bank Digital Currencies. The EO focuses primarily on research requirements.
The SEC has proposed new environmental, social and governance (ESG) reporting and disclosure requirements for public companies. For larger companies, it would also include an attestation requirement regarding greenhouse gas disclosures. Comments are due 30 days after publication in the Federal Register, or May 20, whichever is later.
As NASBA gets ready to transition the CPA exam to its new format, current students were eager to know what happens if a part they passed changes and how that would be considered for the new exam. Thankfully, NASBA has issued a very easy to understand transition model for students. The new exam is set to launch in 2024!
The AICPA’s Government Audit Quality Center has released 4 tools that can help auditors make sense of auditing provider relief funds. It addresses the unique HHS audit requirements as well as how to handle Parent / Subsidiary relationships. It also has a tool for auditors new to performing single audits as well as a checklist for organizations getting their first single audit. The GAQC has made these available to the public and you do NOT need to be a GAQC member to access (although the membership is more than worth the investment!)
While much of the focus of the implementation of SAS 134-140 have been on the financial statement report and the Single Audit report, it is important to note that when the AICPA issued updated examples in their A&A guide, it included changes to the Yellow Book report as well. We’ll review some of the biggest changes to make sure these minor edits are included when issuing GAGAS reports.
The AICPA’s Healthcare Expert Panel has issued a Technical Q&A regarding the accounting for vaccines that were provided during the pandemic. The guidance applies to nonprofits and for profit entities. The TQA requires entities to evaluate whether the transaction is exchange or nonexchange and if nonexchange whether the entity is acting as a principal or an agent.
The AICPA has issued an exposure draft addressing AU-C 935, Compliance Audits. This section is used when performing Single Audits. The appendix references were in need of an update from other recently issued SASes. This would correct the appendix to ensure auditor’s understood what paragraphs in various AU-C sections do not apply when performing Single Audits. Comments are due May 16.
FASB has issued a new Chapter to the Concepts Statements focusing on Presentation. Presentation includes how the elements are presented as totals and subtotals on the face of the financial statements. While Concept Statements are not GAAP, they are the theory used by the board to create GAAP.
FASB has issued an exposure draft which would require additional disclosure about supplier financing arrangements sometimes referred to as reverse factoring. These disclosures would provide users with information about the agreements and the location of the obligation in the financial statements. Comments are due March 21.
The FASB has issued an update to the definition of key elements in the Concept Statements. The definitions of an asset, liability, revenue and expenses have all received an update. This blog will discuss what’s changing and how the concept statements interact with the writing of ASUs.
The Professional Ethics Executive Committee (PEEC) of the AICPA has postponed the implementation of the Information System Services Interpretation an additional year. In addition, PEEC has also provided a new practice aid. The interpretation will now be effective in January 2023.
Happy New Year! Let’s wrap up 2021 with a review of all things accounting and auditing! 2021 saw a flurry of activity from the AICPA, FASB and GASB. We’ll review the final and proposed standards that were issued in 2021. Wishing you all a prosperous 2022!
Disclaimer: The information contained within this blog is provided for informational purposes only. Viewing this material does not qualify for CPE credit. Additionally, this general knowledge is not intended to substitute for obtaining accounting, legal, or financial advice from a professional accountant with specific knowledge of your organization. Finally, watching this blog and/or subscribing to the newsletter do not create an accountant-client relationship.