🌐 What’s new

• IBM publishes “Cost of a Data Breach Report 2024.” New research from IBM and Ponemon Institute provides insights from the experiences of 604 organizations and 3,556 cybersecurity and business leaders hit by a breach. 

• IASB proposes illustrative examples to improve reporting of climate-related and other uncertainties in financial statements. The IASB is proposing eight examples to illustrate how companies apply IFRS Accounting Standards when reporting the effects of climate-related and other uncertainties in their financial statements.

• IASB proposes amendments to IFRS 19 Subsidiaries without Public Accountability: Disclosures. The proposals would reduce disclosure requirements from new IFRS Accounting Standards and amendments issued between February 2021 and May 2024.

• PCAOB issues “Annual Report on the Interim Inspection Program Related to Audits of Brokers and Dealers.” The report shows high deficiency rates and provides good practices and reminders for firms

• FASB seeks comments on proposed derivatives scope refinements. The proposal addresses (1) the application of derivative accounting to contracts with features based on the operations or activities of one of the parties to the contract and (2) the diversity in accounting for a share-based payment from a customer that is consideration for the transfer of goods or services.

• PCAOB Staff shares observations from outreach on use of generative AI in audits and financial reporting. The report includes several observations, including that the current integration of GenAI in audits conducted by the firms that the PCAOB staff spoke to appears to be focused primarily on administrative and research activities. However, most audit firms interviewed noted the potential for using GenAI in certain aspects of planning and performing the audit.

• FASB issues new and final chapter of its “Conceptual Framework: Measurement“.
  The new chapter relates to the measurement of items recognized in financial statements. The Conceptual Framework is a body of interrelated objectives and fundamentals that provides the FASB with a useful tool as it sets standards.

• PCAOB updates standards to clarify auditor responsibilities when using technology-assisted analysis. The Board takes action to address aspects of the auditor’s use of technology-assisted analysis to reduce the risk that auditors will issue an opinion without obtaining relevant and reliable audit evidence. 

• IPSASB is developing first public sector sustainability reporting standard.
  The International Public Sector Accounting Standards Board (IPSASB), with support from the World Bank, is developing a climate-related disclosures standard for the public sector.

• President vetoes SAB 121 repeal.
  While the House and Senate voted to repeal Staff Accounting Bulletin (SAB) 121, which requires custodians of crypto assets to record a safeguarding obligation and related asset, President Biden has vetoed the bill. As a result of the veto, entities that file financial statements with the SEC must still consider whether SAB 121 is applicable to them.

• AICPA updates practice aid for digital assets.
  The AICPA practice aid on the accounting for and auditing of digital assets was updated to reflect new guidance on auditing their valuation and auditing procedures regarding their existence, rights, and obligations.
  

• SEC Staff issues statement on the application of IFRS 19 in filings with the SEC.
  In certain situations, requirements of IFRS 19 are likely to necessitate additional disclosures in financial statements filed with the SEC because such financial statements are intended for use by investors in our public capital markets for making investment and voting decisions.

• AICPA releases new ethics guidance related to public interest entities.
  The new definition of publicly traded entity and the revised definition of public interest entity fulfill the AICPA’s responsibility as a member body of the International Federation of Accountants (IFAC) to converge with recent changes in international ethics for accountants.

• PCAOB updates its standard-setting, research, and rulemaking agendas to reflect 2024 progress.

• FASB issues standard that clarifies accounting guidance related to profits interest awards.
  The new guidance improves generally accepted accounting principles (GAAP) by adding illustrative guidance to help entities determine whether profits interest and similar awards should be accounted for as share-based payment arrangements within the scope of Topic 718, Compensation—Stock Compensation.