OMB has issued an updated memo addressing Covid-related flexibilities provided under prior OMB Memos. Many of the flexibilities offered in the earlier memos have been rescinded. The memo does permit two flexibility measures to continue – coverage of salaries and single audit submission deadlines. However, the flexibility for 2020 year ends has been rescinded.
The AICPA has issued a Technical Q&A to provide guidance on how nongovernmental entities should account for monies received under the CARES Act. The Q&A addresses questions related to how to account for the forgiveable portion of the PPP loans. GASB has issued a separate exposure draft addressing accounting for governmental entities.
GASB has issued an exposure draft, Accounting and Financial Reporting Issues Related to the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) of 2020 and Coronavirus Diseases, to address questions relating to the proper accounting for CARES Act funding including PPP. The Q&A addresses questions about whether this would be treated as an extraordinary or special item, as operating or nonoperating revenue and when does a forgivable loan become revenue. Comments are due June 25th.
FASB voted to delay both revenue recognition and leases for private entities at their May 20th meeting. The original proposal was for a delay for private company franchisors to receive a one year delay of revenue recognition. But the Board added all private entities that have not yet issued financials. In addition, both “public” and private nonprofits as well as all private entities receive an extra year (in addition to ASU 2019-10) for leases. ASU to be issued in June!