- The SEC plans to finalize a rule revising the definition of “smaller reporting company” in the fall of 2018. The revision is intended to and let more companies file registration statements and periodic reports with a lighter load of disclosures. The current threshold is set at $75 million in public float, and the SEC in June 2016 proposed raising it to $250 million.
- The PCAOB said in its most recent standard-setting agenda that plans to continue working on the standards projects for accounting estimates and the use of specialists. The two related proposals are intended to strengthen the requirements when auditors scrutinize assets and liabilities that are hard to estimate, such as fair value measurements, oil company reserves, and actuarial forecasts.
- The PCAOB updated its staff guidance to help accounting firms comply with the requirements for the expanded audit reports they will have to begin filing in 2018. The update gives additional information to guide accounting firms when determining the tenure, or length of time they have served a client, that should be reported.
- The SEC wants to pay close attention to how the adoption of some of the FASB’s major standards may affect their financial reporting controls in 2018 and beyond. The new revenue standard becomes effective in 2018, and the lease accounting amendments have a 2019 compliance date. Because of the changes to the accounting requirements, public companies and their auditors are expected to face a number of challenges with testing internal controls and ensuring that they are sound.