Recommendations on financial reporting improvements given to SEC.

• Position: Regulatory matters

The Securities and Exchange Commission's Advisory Committee on Improvements to Financial Reporting (CIFiR) provided the SEC with its final report on July 31, 2008. CIFiR was formed in June 2007 to examine the U.S. financial reporting system with the goals of reducing unnecessary complexity and making information more useful and understandable for investors.

Officially presented to SEC Chairman Christopher Cox at a press conference on Aug. 1, 2008, the CIFiR Final Report contains 25 recommendations. The SEC previously had taken action on two of those recommendations: proposing the implementation of interactive financial reporting (XBRL) and providing guidance to companies on the display of that data on Web sites for investor use.

Earlier this year, AICPA Chairman of the Board of Directors Randy Fletchall, CPA, testified before the CIFiR on its preliminary recommendations regarding the use of XBRL and increasing the level of respect for well-reasoned, good-faith judgments of financial statement preparers and auditors. The Center for Audit Quality (CAQ; www.thecaq.org), an affiliate of the AICPA, also was involved with the CIFiR and submitted a comment letter on its draft report and is expected to do the same for the final report.

At the press conference, the chairman of CIFiR, Robert Pozen, highlighted four key topics in the report. Pozen believed these topics to be the most important that the committee...