This week’s GAAP Flash includes articles about proposals for the new leasing standard (ASC 842), criticism the SEC is facing related to their data breach, the importance of dedicating time to plan for an audit, and how the big four have snagged top spots on a list of the best companies for working mothers.

FASB proposes clarifying land easements guidance in leases standard (September 25, 2017) – Journal of Accountancy (@AICPA_JofA)

On Monday, FASB proposed a clarification of land easements (the right of use or access of another entity’s land for a specified purpose). Under the new proposal, land easements should be assessed under the new lease guidance. This comes as a relief to many stakeholders who recognized the complexity of evaluating whether or not existing land easements would fall under the definition of a lease under ASC 842.

How It’s Relevant: The leasing standard change is set to take effect for public companies for fiscal years beginning after December 15, 2018, and all other organizations with fiscal years after December 15, 2019. As with any new standard, numerous issues and questions will be raised between the time it is issued and when it becomes effective. These standards will change the way many businesses account for leases, assets, and liabilities on their books! We have compiled many helpful resources related to the new standards and have written a blog on the top 5 biggest changes to ASC 842. We are here to help with any questions you have!

Lawmakers Criticize SEC Chairman Over Handling of Hack (September 26, 2017) – Wall Street Journal (@WSJ)

Last week, the SEC admitted that they were subject to a data breach in 2016. The SEC’s new chairman has come under harsh criticism about the agency’s response to the breach. The SEC did not disclose information about the hack until it was discovered during their most recent review. They still have not given details as to what information was subject to the breach, and it is unclear how much market manipulation occurred.

How It’s Relevant: The response to these breaches certainly does not represent a positive “tone at the top.” The SEC possesses nonpublic information that would be advantageous to investors! It is impossible to tell what impact this had on the stock market and individual companies within the last year. In this day and age, vulnerability to data breaches is inevitable. But it seems the SEC tried to conceal the hack, so how are they to hold other companies accountable for staying transparent?

The importance of audit planning (September 1, 2017) – Journal of Accountancy (@AICPA_JofA)

Audit planning can be tedious, but it is extremely important! It not only helps with audit efficiency, but can prevent professional liability risk. The article outlines sections of the AICPA Statements on Auditing Standards including: timing, risk assessment, and team composition. Budgeting time is clearly important because errors are more likely to occur when it is “crunch time.” Flexibility during the engagement is also essential because even the best laid plans will likely change to some extent!

How It’s Relevant: The article includes a quote “Plans are worthless, but planning is everything.” How often do you spend hours or days planning for an event that does not go as intended? Not only is the written plan important to an audit, there are substantial benefits to the thought process one must go through when creating the plan! Check out our free PCAOB eBook and read our recent blog on audit deficiencies to make sure your audit plans are setting you up for success!

Big Four, more named to Working Mother’s ‘100 Best Companies’ (September 26, 2017) Accounting Today (@AccountingToday

“Working Mother” magazine released a list of the top companies that provide the best environment for working parents. The list was based on surveys with questions about benefits, leave policies, flextime benefits, and telecommuting options. Many accounting firms, including all Big Four firms, were all high on the list!

How It’s Relevant: Working for a company that has a good work / life balance is extremely important! I have worked for companies on all ends of the spectrum and I feel so lucky to have found GAAP Dynamics after my third child was born. The level of flexibility and work / life balance is unprecedented! With opportunities for telecommuting, flexible hours, and the chance to work with an amazing team… trust me, it doesn’t get any better. And guess what? We are hiring!

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