FASB delays FIN 48 implementation
Good news for private companies: The Financial Accounting Standards Board has changed its mind about FIN 48.
The FASB has deferred implementation of FIN 48, titled "Accounting for Uncertainty in Income Taxes," for all non-public companies to periods beginning after Dec. 15, 2007. According to the AICPA, the FASB has instructed its staff to develop a FASB Staff Position, which will have a 30-day comment period once it is released.
The move reverses an earlier FASB decision to reject a delay in FIN 48 implementation. Despite receiving hundreds of corporate comment letters, most of them seeking a delay, the FASB in January 2007 rejected calls for a one-year delay in implementing FIN 48. This time, the board accepted the advice of its own Private Company Financial Reporting Committee (or PCFRC), which is chaired by MACPA member Judy O'Dell. She submitted the following request prior to the FASB's decision:
"The PCFRC believes many private company financial statement users, preparers and CPA practitioners are unaware or just becoming aware of the implications of FIN 48. Importantly, this includes a lack of awareness of FIN 48’s applicability to pass-through entities, which applies to many private company structures. Many private companies do not have the resources to follow FASB proceedings and they often learn about new requirements like FIN 48 at continuing education sessions after the effective date. Many public companies are still struggling with implementation issues, based on a BNA Accounting Policy and Practice Special Report ('An Early Look at FIN 48 Disclosures'; July 13, 2007; Vol. 3, No. 6). Thus, 'best practices' are not in place as examples for private companies."
Get more details about the FASB's decision from the AICPA and WebCPA.
- Nov. 30 town hall meeting to feature an update: O'Dell will join MACPA Executive Director Tom Hood at a Nov. 30 town hall meeting at Salisbury University to present an update about FIN 48 and other issues related to private company financial reporting. Get details about the meeting and register to attend here.