In December 2025, FASB was active both in issuing standards and holding advisory meetings. FASB issued an ASU on accounting for government grants received by business entities (ASU 2025‑10, Government Grants – Topic 832) that adds explicit U.S. GAAP guidance on recognition, measurement, and presentation of government grants. FASB also issued ASU 2025‑11 on Interim Reporting (Topic 270): Narrow‑Scope Improvements, aimed at improving the navigability and clarity of interim reporting guidance. They also issued ASU 2025-112, which is a Codification Improvement. The Financial Accounting Standards Advisory Council (FASAC) held a meeting on December 2 and met with the Private Company Council (PCC) on December 11 and 12. We don’t expect any more ASUs for 2025, so if you guess 12 for the year, you would be correct! However, if any come out between today and the end of the month, we’ll include them in our January newsletter!
The biggest news coming out of the December GASB meeting was that the Board voted to approve the issuance of Statement No. 105 on Subsequent Events! GASB 105 was published and released on December 17. The Board continued deliberations on the Revenue and Expense Recognition project, focusing on Category B expense transactions, including assistance provided directly to individuals and programs established through legislative binding arrangements. The Board also made progress on voluntary digital financial reporting, discussing an initial framework for standardizing note disclosure topics based on observed practice.
The ASB met in December for a short meeting focused on survey results from the 2025 Peer Review Conference. They also discussed QM and Risk Assessment Resources. They are scheduled to meet again for 3 days at the end of January.
On December 5, PEEC issued revisions to the AICPA Code of Professional Conduct to clarify independence requirements for engagements subject to the Statements on Standards for Attestation Engagements (SSAEs). The revisions are effective June 15, 2026, with early implementation permitted. Most interpretations of the Independence Rule (ET §1.200.001) were written from the perspective of financial statement audits and reviews, but they apply to all attest engagements, including SSAE engagements, which often involve different subject matters and reporting requirements. To clarify the guidance, PEEC replaced the phrase “period covered by the financial statements” with the defined term “period covered by the attest report,” revised interpretations to reflect terminology applicable to SSAE engagements, and added examples illustrating how independence requirements apply to SSAE engagements. These revisions do not change the intended application of existing requirements in the Code. PEEC received 15 comment letters on the exposure draft, with comments generally supportive and no substantive revisions resulting. Additional information is available in the exposure draft and the agenda from PEEC’s November meeting.
With the issuance of the 2025 Compliance Supplement, many firms are knee-deep in Single Audits. The 2025 changes to quality management were also effective this month. As with any new president, OMB also issued the President’s Management Agenda on December 8th with 3 core areas of focus – Shrink the Government & Eliminate Waste; Ensure Accountability for Americans; and Deliver Results, Buy American.
