EMERGING ACCOUNTING ISSUES

Research of Emerging Accounting Issues

Abstract

The purpose of this paper is to review the issues that the Emerging Issue Task Force is working on, identifying its role and evaluating its effectiveness in finding resolution to the accounting issues. It also assesses the effect and impact of EITF's work on a company's accounting and financial reporting. The differences in accounting treatment between US Generally Accepted Accounting Principles and International Financial Reporting Standards for the issue highlighted. As well as the role of EITF in adopting one global accounting standard.

Emerging Accounting Issues

Introduction

The Emerging Issues Task Force (E.I.T.F) is an organization which was created in 1984 on the recommendation of F.A.S.B (Financial Accounting Standard Broad).The main aim of forming this body is to help the FASB in improving the financial reporting issues through timely identification, discussion and solving issues affecting financial accounting and reporting, all of this being done under the framework set by the Financial Accounting Standard Board. It also deals with problems that are related to the implementing of existing accounting standards and reporting for non-governmental entities. This organization mainly deals with short term issues that can be solved more easily so that the FASB can spend its time and effort in addressing long term, complicated issues. This organization has been formed with help of, users and preparers of financial statements, auditors, as well as accountants from various public firms. In order to identify and resolve financial accounting issues public meetings are organized by the Emerging Issues Task Force. These meetings are attended and observed by the chief accountant of Security Exchange Commission, the Financial Reporting Executive Committee of American Institute of Certified Public Accountants (AICPA) as well as representatives from International Accounting Standard Board. The board members of FASB also attend these meeting as well as participate in the discussion. As of September 2012 EITF has three participating observers, fourteen task force members from various audit and public firm, one coordinator and one chairman both from FASB. EITF meeting is open to public and from June 2004 meeting material and minutes are available on the website.

A meeting is scheduled to be held on 1st November 2012 to discuss Issue No. 12-B, "Not-for-Profit Entities: Services Received from Personnel of an Affiliate for Which the Affiliate Does Not Seek Compensation", Issue No. 12-D, "Accounting for Obligations Resulting from Joint and Several Liability Arrangements for Which the Total Amount of the Obligation Is Fixed at the Reporting Date", Issue No. 12-H, "Accounting for Service Concession Arrangements" and Issue No. 12-F, "Recognition of New Accounting Basis (Pushdown) in Certain Circumstances".

The EITF has only two issues which are open they are: Issue No. 11-A, "Parent's accounting for the Cumulative Translation Adjustment upon a Sale within a Foreign Entity or a Sale of an Investment in a Foreign Entity" and Issue No. 12-G, " Accounting for the Difference between the Fair Value of the Assets and the Fair Value of the Liabilities of a Consolidated Collateralized Financing ...