September was an exciting month for the standard setters, evidenced by the issuance of exposure drafts and various meetings.

On September 25, the FASB issued a proposed ASU aimed at clarifying certain aspects of hedge accounting guidance. This update also addresses issues arising from the global reference rate reform initiative. The proposed changes would expand the application of hedge accounting to more highly effective economic hedges, improving the quality of information provided to investors. This follows the 2017 issuance of ASU No. 2017-12 (Derivatives and Hedging, Topic 815), designed to better align hedge accounting with the economic results of risk management activities. Stakeholders have until November 25, 2024, to provide feedback.

Additionally, on September 30th, the FASB issued a proposed ASU to enhance guidance for share-based consideration payable to customers when selling goods or services. The update is intended to align these requirements with the principles of Topic 606 (Revenue from Contracts with Customers), improving the accuracy of revenue estimates and comparability in financial reporting. This proposal impacts the timing of revenue recognition for entities offering share-based incentives (such as equity instruments) to customers. The update clarifies the requirements when such share-based consideration vests based on the purchase of a specified volume or monetary amount of goods or services. Stakeholders are encouraged to review and provide feedback on the proposal by November 14, 2024.

On September 30, the AICPA and NASBA sought feedback on proposed changes to the Uniform Accountancy Act (UAA), which aimed to create a new pathway for CPA licensure. This change would support the CPA Competency-Based Experience Pathway, offering more flexibility to CPA candidates by allowing them to meet professional and technical competencies instead of completing the final 30 credit hours of the traditional 150-hour requirement.

The proposed changes would:

• Define the education required to sit for the CPA exam;
• Specify the requirements for the new licensure pathway;
• Retain mobility for CPAs licensed under UAA pathways;
• Provide a way for those initially licensed under other pathways to meet UAA mobility standards.

The public comment window on the UAA changes ends December 30, 2024, and feedback on the CPA Competency-Based Experience Pathway will be accepted through December 6, 2024.

In addition, on September 23rd, the AICPA’s Accounting and Review Services Committee (ARSC) proposed an exposure draft that would amend the applicability of AR-C section 70 to explicitly exclude financial statements prepared as part of a consulting services engagement performed in accordance with CS section 100, Consulting Services: Definitions and Standards from those engagements in which AR-C section 70 is required to be applied. The comment period ends December 20th.

Finally, the GASB held two meetings in September. On September 9th, GASB reviewed and considered approval of a proposed final Statement on the Disclosure of Certain Capital Assets. On September 30th, the board met in Norwalk and voted unanimously to approve GASB 104, Disclosure of Certain Capital Assets, which contains guidance on the disclosure and classification of certain capital assets to ensure they’re classified in the way that provides the most relevant information, including disclosed capital assets held for sale. During the September 30th meeting, the GASB also discussed infrastructure assets and subsequent events.

Stay tuned for more updates next month!