...Accounting Standards Codification® Notice to Constituents (v 4.6) About the Codification FASB Accounting Standards Codification® Notice to Constituents (v 4.6) About the Codification Notice to Constituent version numbers - The Notice to Constituents contains a version number indicating the degree of change within a particular version. Versions ending with ".0" represent substantive changes to the text, whereas versions ending with a number other than zero represent editorial or clerical corrections. Page FASB Accounting Standards Codification ................................................................................... 4 Codification Goals .......................................................................................................................... 5 Codification Research System ........................................................................................................ 6 Content Matters............................................................................................................................... 7 Population of codified standards as of July 1, 2009 ................................................................... 7 Standards issued by standard setters other than the SEC ........................................................ 7 Standards issued by the SEC................................................................................................... 8 Essential and nonessential content ................................
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...Accounting Standards Codification® Notice to Constituents (v 4.5) About the Codification FASB Accounting Standards Codification® Notice to Constituents (v 4.5) About the Codification Notice to Constituent version numbers - The Notice to Constituents contains a version number indicating the degree of change within a particular version. Versions ending with ".0" represent substantive changes to the text, whereas versions ending with a number other than zero represent editorial or clerical corrections. Page FASB Accounting Standards Codification ................................................................................... 4 Codification Goals .......................................................................................................................... 5 Codification Research System ........................................................................................................ 6 Content Matters............................................................................................................................... 7 Population of codified standards as of July 1, 2009 ................................................................... 7 Standards issued by standard setters other than the SEC ........................................................ 7 Standards issued by the SEC................................................................................................... 8 Essential and nonessential content ................................
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...FASB Codification System Orientation Paper Joel Bermudez ACC/497 January 28, 2015 Nanette Morrow In a constant developing economy and globalization, a need was created to make a guideline for an easier, clearer, and useful financial reporting system. For this purpose, the Financial Accounting Standards Board (FASB) created the Accounting Standards Codification that was launched on July 1, 2009, for interim and financial reporting after September 15, 2009. The Financial Accounting Standards Board (FASB) codification system or Accounting Standards Codification (ASC) is a system that compiles all general accepted accounting principles (GAAP) to be used in the United States for public financial reporting. The FASB’s codification system is a database and research system created to compile all the accounting standards and resources into a single, easier to understand and research list of contents. The main purpose of the Accounting Standards Codification (ASC) or the FASB Codification System is to make a guide of accounting principles and regulations, and compile them into an easier to navigate, research, and reference list. By only having a single system of rules to follow, a lot of confusion and extra research and/or work is saved, instead of having an overload of different and separated guidelines and principles where to choose from. The FASB Codification System is divided into nine areas, which in turn are divided into topics, which then are divided into subtopics, and...
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...Case 13-01 Refer-a-Friend Program “Runway Discount (“Runway” or the “Company”) is a privately held online retailer that sells discounted high-end fashion. In an effort to increase its sales and customer base, Runway implemented a customer referral marketing campaign (the “Refer-a-Friend Program”) whereby existing customers can refer friends to Runway and receive a $25 credit towards the purchase of future merchandise”(Deloitte.com, n.d.). Runway offers a $25 gift card to the customers who refer a friend. The gift card is being sent when the new referred friend makes first purchase. The $25 Referral Credit is recorded in Runway’s Income Statement — as a marketing expense. According to FASB Accounting Standard Codification, 605-50-45-1,“A vendor may give a customer a sales incentive or other consideration addresses the circumstances under which that consideration is either: • a. An adjustment of the selling prices of the vendor’s products or services and therefore characterized as a reduction of revenue when recognized in the vendor’s income statement • b. A cost incurred by the vendor for assets or services received from the customer and therefore characterized as a cost or expense when recognized in the vendor’s income statement” FASB Accounting Standards Codification. (n.d.). Also, According to FASB Accounting Standard Codification, 605- 50-25-3“For a sales incentive offered voluntarily by a vendor and without charge to customers that can be used or that becomes exercisable...
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...Series of Revenue Recognition Research Cases Using the Codification Case One: Consumer Cleaning Products Corporation (CCPC) Case Two: Landline Corporation Case Three: Assembly Lines Incorporated (ALI) Submitted By Chen Chongxiao Sweta Shah Xiaoyun zhang Case One Requirement 1: The accounting issue in this case is how to account for the coupons which was introduced on Sep. 1 2009 for the new detergent Fresh & Bright Marketing campaign by a detergent manufacturer called Consumer Cleaning Products Corporation (CCPC). The coupon drops served as a sales incentive, which can be further explained by FASB Codification Section 605-50, “Customer Payments and Incentives,” in this case. Requirement 2: According to FASB Codification 605-50-25-3, for a sales incentive offered voluntarily by a vendor and without charge to customers that can be used or that becomes exercisable by a customer as a result of a single exchange transaction, and that will not result in a loss on the sale of a product or service, a vendor shall recognize the cost of such a sales incentive at the later of the following: a. The date at which the related revenue is recognized by the vendor b. The date at which the sales incentive is offered (which would be the case when the sales incentive offer is made...
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...FASB Accounting Standards Codification Written Project (120 points) Due date: May 6 (No late submission is accepted) ------------------------------------------------- Instructions: Answer all three questions listed in the Case 12-3 (Provisions and Contingencies) This assignment is suggested to be a typed double-spaced document between 1 to 4 pages. ------------------------------------------------- Information about FASB Accounting Standards Codification: Analyze the case and provide citations by using the FASB Accounting Standards Codification system. * To access the FASB Accounting Standards Codification (CRS): Website: http://aaahq.org/ascLogin.cfm Username: AAA51393 Password: 2ChgCxk * The citation format (e.g., ASC 230-10-20) is listed by “topic”, “subtopic”, and “section” respectively under the FASB Accounting Standards Codification system. * When providing quotes, you do not need to copy and paste the entire paragraph. Only the citations and brief summary are needed. You need to specify the topic, subtopic, section, and paragraph if applicable. * An example is provided below: According to ASC 230-10-20, the statement of cash flows classifies all transactions affecting cash into one of the following categories: operating, inventing and financing activities * Please note that the Codification only contains SEC content related to matters within the basic financial statements, but it does not contain the entire population of...
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...Name__David Brubaker____________ Accounting 306 Extra Credit Case Fall 2010 The purpose of this case is to improve your GAAP research skills by familiarizing you with FASB’s Accounting Standards Codification. The codification is relatively new (it became the single source of authoritative GAAP effective July 1, 2009) and requires new and unique techniques for researching GAAP. The case has two parts; for each part you will need to access the codification using the instructions found at the end of this document. Part A. The questions posed in this part relate to the structure and selected features of the codification. The easiest way for you to answer these questions is to view three short tutorials available at the codification website. The pertinent tutorial is noted next to each question. Questions (1 point each): 1) List the three benefits that are expected to be obtained by adopting the codification. (see Codification Overview Tutorial) 1. Simplify the organization of authoritative literature. 2. Provide all authoritative literature in one spot. 3. Give real-time updates to help you stay current with the standards. 2) What does the letter “S” mean that precedes some section numbers in the codification? (see Navigation and Content Tutorial) SEC documents 3) Where in the codification (provide the full citation) does one find the guidance that was originally provided in Statement of Financial Accounting...
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...According to FASB (2012), “The FASB Accounting Standards Codification is the source of authoritative generally accepted accounting principles (GAAP) recognized by the FASB to be applied to nongovernmental entities” (FASB Accounting Standards Codification, Para. 1). The FASB accounting standards codification is basically a record of bookkeeping data that will allow clients to browse amongst thousands of GAAP proclamations that are put into about 100 issues. The system is planned to help lessen the convulsion of nongovernmental standards, at the same time as smoothing the progress of the augmented must for international standards. Since this system is basically a trustworthy basis for GAAP, the system matters are planned to diminish the quantity of values, and the ones who set the values, with the direction of the Securities and Exchange Commission. The main purpose of the FASB Codification System is to help integrate and synthesize existing GAAP and not to create new GAAP. It creates one level of GAAP which is considered authoritative. The FASB Codification Research System (CRS) is an-on-line real time data base that provides easy access to the Codification. The Codification and the related CRS provides a topically organized structure that is subdivided into topic, subtopics, sections, and paragraphs. The nine content areas located in the FASB Codification System are: General Principles, Presentation, Assets, Liabilities, Equity, Revenue, Expenses, Broad...
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...of the possible liability. At December 31, 2007 it was determined that the loss was probable and was estimated to incur a cost of $15 million to $20 million with $17 million being the most probable amount. I strongly suggest that the company recognize this potential loss because given the facts, FASB would require it. According to FASB Codification 450-20-25-2, “An estimated loss from a loss contingency shall be accrued by a charge to income if…Information available before the financial statements are issued or are available to be issued and the amount of loss can be reasonably estimated.” In this case, both requirements are met so it would be difficult to make a case against the recognition of the potential loss on December 31, 2007. The next issue to consider is the amount of loss contingency that should be recorded. A $17 million contingent liability should be accrued because according to FASB codification 450-20-30-1 “if some amount within a range of loss appears at the time to be a better estimate than any other amount within the range, that amount shall be accrued.” If the company did another valuation in which they found that each amount in the range were equally likely a case could be made to record the lowest amount...
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...Case Analysis Intermediate Accounting A Series of Revenue Recognition Research Cases Using the Codification Case One: Consumer Cleaning Products Corporation (CCPC) Case Two: Landline Corporation Case Three: Assembly Lines Incorporated (ALI) Submitted By Chen Chongxiao Sweta Shah Xiaoyun zhang Case One Requirement 1: The accounting issue in this case is how to account for the coupons which was introduced on Sep. 1 2009 for the new detergent Fresh & Bright Marketing campaign by a detergent manufacturer called Consumer Cleaning Products Corporation (CCPC). The coupon drops served as a sales incentive, which can be further explained by FASB Codification Section 605-50, “Customer Payments and Incentives,” in this case. Requirement 2: According to FASB Codification 605-50-25-3, for a sales incentive offered voluntarily by a vendor and without charge to customers that can be used or that becomes exercisable by a customer as a result of a single exchange transaction, and that will not result in a loss on the sale of a product or service, a vendor shall recognize the cost of such a sales incentive at the later of the following: a. The date at which the related revenue is recognized by the vendor b. The date at which the sales incentive is offered (which would be the case when the sales incentive offer is made after the vendor has recognized revenue; for example, when a manufacturer issues coupons offering discounts on a product that it already has sold to retailers)...
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...Professional Research: FASB Codification Chapter 11 a. What is the authoritative guidance for asset impairment? Briefly discuss the scope of the standard (i.e., explain the types of transactions to which the standard applies) The authoritative guidance for asset impairment is to ensure that impairment is recorded and dealt with as depreciation. The scope of the standard is writing off of assets and depreciation. According to the guidance of 360-10-35, it address how long-lived assets that are intended to be held and used in an entity’s business shall be reviewed for impairment. The impairment loss can only be recognized if the carrying amount of a long-lived assets is not recoverable and exceeds its fair value. When the carrying amount exceeds the sum of undiscounted cash flows, it is not recoverable. The assessment is based on the carrying amount at the date it is tested for recoverability, whether in use or under development. Moreover, the amount by which the carrying amount of assets exceeds it fair value is measured as the impairment loss amount. In addition to the test, it also is necessary to review depreciation estimates and methods, since it may address for changes in estimates, including changes in the method of depreciation, amortization, and depletion. When an impairment loss is recognized, the adjusted carrying amount will be the asset’s new cost basis, and will be depreciated or amortized over the remaining useful life of the asset (FASB Codification 360). b. Give...
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...Memorandum To: Pat Tyler From: Naz Date: 4/17/16 Re: Mighty Mufflers Corp. (MMC) Loss Contingencies Issues The complexity of MMC’s accounting for its litigation liability must be addressed in three components. First, we must determine the amount necessary to be accrued as of December 2012 from the First Settlement. Next, we must determine the placement of the aforementioned accrual from the First Settlement on the income statement. Finally, we must determine how to account for the True-Up Payment as of December 2012. In the First Settlement, MMC agreed to a total settlement of $30 million; $10 million of this is due in 2013, $10 million will be issued as a rebate on 2013 purchases made by plaintiffs, and the final $10 million will be due in 2014. There are seemingly few options, some of which are viable, in the accounting of the First Settlement. The options are to omit any recognition of the settlement since no payments were due in 2012 (but make a disclosure in the footnotes of the financial statements), accrue a portion of the $30 million on the balance sheet, or accrue the entire $30 million on the balance sheet. The aforementioned accrual, and the decision in how to recognize it as of December 2012, will impact the income statement. If no entry is made to accrue any amount from the First Settlement, there will be no effect on the income statement. If a portion or all of the First Settlement is accrued, then it can be recognized as an extraordinary loss on the income...
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...for share-based payment transactions and special purpose entities and discusses how these requirements relate to the auditing process. Share-based payment reporting: Financial Accounting Standards Board (FASB) defines share-based payment arrangements as follows: “An arrangement under which either of the following conditions is met: a. One or more suppliers of goods or services (including employees) receive awards of equity shares, equity share options, or other equity instruments. b. The entity incurs liabilities to suppliers that meet either of the following conditions: 1. The amounts are based, at least in part, on the price of the entity’s shares or other equity instruments. (The phrase at least in part is used because an award may be indexed to both the price of the entity’s shares and something other than either the price of the entity’s shares or a market, performance, or service condition.) 2. The awards require or may require settlement by issuance of the entity’s shares” (FASB ASC 718-10-20). FASB 718-10-25 details specific guidelines for the recognition of share-based payment transactions (FASB ASC 718-10-25). FASB specifies when the services and costs related to the share-based payment transactions should be recognized; according to FASB: “25-2 An entity shall recognize the services received in a share-based payment transaction with an employee as services are received. Employee services themselves are not recognized before they are received...
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...with experience in researching a set of financial accounting issues, developing conclusions based on that research, and communicating those conclusions to interested parties. In the process, students will update their financial accounting skills and gain a familiarity with current events in public accounting. Required Course Materials We will make extensive use of the FASB codification located at https://aaahq.org/FASB/Access.cfm. To log in, use the username AAA51049 and the password Y9J9wvN. We will also use the Trueblood case studies provided by Deloitte and Touche. Office Hours Office hours are MW 2:30 am – 4:30 pm, TR 11:30 – 12:30 pm, and by appointment. Grades The grade will be based on an accounting research presentation and two written research projects. Groups of up to four are allowed for these projects. Course Schedule The course is divided roughly into thirds. In the first part, we will work through the FASB Codification Learning Guide available at the online FASB codification site. In the second part, I will use the codification to analyze selected accounting cases and issues. The third part is reserved for presentations by the student groups. If you have a disabling condition that might interfere with your ability to complete this course successfully, please contact me, or contact the Office of Disability Services (phone 312-3358). | | It is the responsibility of the students to be fully informed of the college catalog policies...
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...Using the FASB Codification of Accounting Standards The Financial Accounting Standards Board (FASB) Codification of Accounting Standards is the current single source of the United States Generally Accepted Accounting Principles (GAAP). The Codification of Accounting Standards is a database and research system created by the Financial Accounting Standards Board that combines many of the authoritative resources about accounting standards into one searchable system. Some of the people who would use the Codification are accounting and reporting professionals, financial analysts, and investors. The FASB Codification allows users to easily search and navigate the content, cutting back on research time and making access to information quicker and more efficient. It was created with the goal to simplify user access to all authoritative U.S. GAAP, reduce the amount of time and effort required to solve an accounting research issue, mitigate the risk of noncompliance, and provide real-time updates as new standards are released. The FASB Codification includes all level A through D generally accepted accounting principles (GAAP) issued by a standard setter and pronouncements issued by the FASB, the Emerging Issues Task Force (EITF), Accounting Standards Executive Committee (AcSEC), Accounting Principles Board, and relevant portion of authoritative content issued by the Securities and Exchange Commission (SEC). The Codification reorganizes the thousands of U.S. GAAP...
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