Monthly Industry Update: FASB, AICPA, PCAOB, SEC, CFTC

We are pleased to share this Industry Update on recent changes impacting the alternative investment industry.

FASB:
  • Issues Proposal for Consolidation of VIEs
    • The proposed ASU is designed to simplify and improve financial reporting associated with consolidation of variable-interest entities (VIEs).
    • A private company would not have to apply VIE guidance to legal entities under common control, including common-control leasing arrangements, if both the parent and legal entity being evaluated for consolidation are not public business entities.
    • Click here to read this update.
AICPA:
  • Issues working drafts on accounting issues associated with the implementation of the new revenue standard for the asset management industry.
PCAOB:
  • Publishes Brief Detailing Scope of 2017 Inspections of Auditors of Broker-Dealers
    • Inspectors are focusing on audit areas and attestation procedures where inspectors previously found deficiencies, including auditor independence, engagement quality reviews, and certain areas of the financial statement audit.
    • During the 2017 inspection cycle, the PCAOB plans to inspect 75 firms that audit broker-dealers, covering portions of 115 audits and the related attestation engagements for these broker-dealers.
    • Click here to read the inspection brief.
  • Issues two proposals on auditing accounting estimates, including fair value measurements, and the use of the work of specialists.
SEC:
  • Expands Popular JOBS Act Benefit to All Companies
    • Will permit all companies to submit draft registration statements relating to initial public offerings for review on a non-public basis. This process will be available for IPOs as well as most offerings made in the first fiscal year after a company has entered the public reporting system.
    • The benefit will provide companies with more flexibility to plan their offering. The non-public review process after the IPO reduces the potential for lengthy exposure to market fluctuations that can adversely affect the offering process and harm existing public shareholders.
    • Click here to read the full press release.
CFTC:
  • Issues Order of Registration to the Dubai Mercantile Exchange
    • Permits trading with direct access for DME’s “identified members or other participants located in the U.S.”
    • This regulation also permits the CFTC to impose any additional conditions it deems necessary, after appropriate notice and opportunity to respond.
    • Click here to read the full press release.
  • Revises Delegated Authorities and Technical Amendments
    • As a result of the recent Commission restructuring, the Final Rule amends certain Commission organizational and procedural provisions to facilitate the movement of the Division of Market Oversight Surveillance Branch to the Division of Enforcement.
    • Makes a limited number of conforming technical corrections to certain Commission regulations.
    • Click here to read the full press release.

We welcome your suggestions for futures topics that you would like to see included in this Industry Update. Also, for further information regarding these changes, please contact your Arthur Bell representative at 855-787-0001 or via email at contactus@arthurbellcpas.com.

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