Ask FERF (financial executives research foundation) about ... recent regulatory highlights.

• Author: Orenstein, Edith G.
• Position: Resources

While the fourth quarter may seem like a quiet period with respect to new rulemaking from the Securities and Exchange Commission (SEC) and Public Company Accounting Oversight Board (PCAOB), it's more likely a period of allowing preparers and auditors time to focus on initial implementation of new rules under Sarbanes-Oxley Section 404.

However, the Financial Accounting Standards Board (FASB) is expected to finalize several new standards and issue Exposure Drafts (EDs) of proposed standards. And, even if FASB extends effective dates of any new standards issued, the impact of such "relief" could be muted by the need to comply with SEC Staff Accounting Bulletin No. 74 (SAB 74), which requires disclosure of the impact of new accounting standards issued, but not yet effective.

Securities and Exchange Commission (SEC). New rules on Form 8-K (Additional Form 8-K Disclosure Requirements and Acceleration of Filling Date) became effective August 23. Issued in March, with technical corrections in August, rules expand the types of material events to be reported, and shorten the time in which 8-Ks must be filed, to four business days from five or fifteen days.

Public Company Accounting Oversight Board (PCAOB). In addition to staff guidance issued by the PCAOB and SEC in June (Staff Questions and Answers: Auditing Internal Control Over Financial Reporting and Management's Report on Internal Control Over Financial Reporting and Disclosure in Exchange Act Periodic Reports--Frequently Asked Questions, respectively), in a July teleconference sponsored by Glasser Legal Works and RR Donnelly, PCAOB and SEC speakers provided insights on the internal control-related standards (Auditing Standard 2, An Audit of Internal Control Over Financial Reporting Performed in Conjunction with an Audit of Financial Statements and Management's Reports on Internal Control Over Financial Reporting and Certification of Disclosure in Exchange Act Periodic Reports).

Speakers said remarks were "their" views, not necessarily those of the agencies. FEI has posted a summary at: www.fei.org/files/spacer.cfm?file_id=1121.

Financial Accounting Standards Board (FASB). FASB is redeliberating the ED on share-based payment, amid an environment marked by Congressional hearings and proposed legislation. FASB is also redeliberating the initial four short-term convergence EDs issued last year

Comment letters indicate disagreement with the EDs on inventory costs and accounting changes, and...