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Accounting & Audit Alert April 2013


RubinBrown's Accounting & Auditing Alert is published monthly to inform our clients and contacts about relevant technical accounting and audit-related information.

FASB Issues ASU Related To Joint And Several Liability Arrangements

The Financial Accounting Standards Board (FASB) has released Accounting Standards Update (ASU) 2013-04 titled Obligations Resulting from Joint and Several Liability Arrangements for Which the Total Amount of the Obligation Is Fixed at the Reporting Date, which amends FASB ASC 405 related to this topic.

ASU 2013-04 attempts to fill a void in technical literature related to a lack of specific guidance over recognition, measurement, and disclosure of obligations resulting from joint and several liability arrangements.

FASB Issues ASU Related To Parent’s Accounting For The Cumulative Translation Adjustment

The FASB has issued ASU 2013-05 titled Foreign Currency Matters (Topic 830) - Parent’s Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity.

The ASU is intended to resolve diversity in practice about whether Subtopic 810-10, Consolidation—Overall, or Subtopic 830-30, Foreign Currency Matters—Translation of Financial Statements, applies to the release of the cumulative translation adjustment into net income when a parent either sells a part or all of its investment in a foreign entity or no longer holds a controlling financial interest in a subsidiary or group of assets that is a nonprofit activity or a business (other than a sale of in substance real estate or conveyance of oil and gas mineral rights) within a consolidated foreign entity.

FASB Issues Proposal On Derivatives And Hedging

The FASB has issued an Exposure Draft titled Derivatives and Hedging (Topic 815): Inclusion of the Fed Funds Effective Swap Rate (or Overnight Index Swap Rate) as a Benchmark Interest Rate for Hedge Accounting Purposes.

The proposed amendments would affect all entities, both public and nonpublic, that elect to apply hedge accounting of the benchmark interest rate under Topic 815, Derivatives and Hedging.

FASB Proposes Improvements To Recognition And Measurement Of Financial Assets And Liabilities

The FASB has issued for public comment a proposal to improve financial reporting by providing a comprehensive measurement framework for classifying and measuring financial instruments.

The FASB developed the proposed ASU, Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities, as part of its broader joint project with the International Accounting Standards Board (IASB) to improve and converge the accounting for financial instruments.

FASB Issues Proposal On Presentation Of An Unrecognized Tax Benefit

The FASB has issued for public comment a proposed ASU, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward or Tax Credit Carryforward Exists.

The objective of the amendments in this proposed ASU is to eliminate the diversity in practice in the presentation of unrecognized tax benefits in the statement of financial position in instances in which a net operating loss carryforward or a tax credit carryforward exists because the guidance in Topic 740, Income Taxes, is not explicit.


Readers should not act upon information presented without individual professional consultation.