Private companies are subject to several frameworks for financial reporting purposes. In this article, Mark Zyla explains the role of the Private Company Council (PCC) and provides a summary of several recommendations the PCC has made to the FASB regarding accounting for goodwill and business combinations.
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FASB has voted to endorse a GAAP alternative to exempt private company lessees from a requirement to consolidate variable interest entities (VIE) in common control leasing arrangements. Initiated by the Private Company Council (PCC), the exemption would be allowed under specific conditions including: Private company lessee and the lessor entity are under common control Private company holds a leasing arrangement with the lessor entity All activity between entities is substantially related to the leasing activity between the lessor and private company Obligations of the lessor that are being guaranteed or collateralized by the private company could, at the inception of…
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Recommendation Framework Paper Available; Comment Period Ends October 31st. Late last month the FASB released its initial staff recommendations on whether and when it will be appropriate to adjust financial reporting requirements for private companies, the Journal of Accountancy reports. The recommendations are contained in a paper, Private Company Decision-Making Framework: A Framework for Evaluating Financial Accounting and Reporting Guidance for Private Companies. FASB on Tuesday invited stakeholders to comment on the recommendations. In May, the Financial Accounting Foundation (FAF), FASB’s parent organization, created the Private Company Council (PCC). The new council will identify, deliberate, and vote on proposed changes, which will…