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The Latest Efforts to Simplify Accounting for Small, Privately Held Companies

  Arthur F. Rothberg, Managing Director, CFO Edge, LLC  
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  Article Summary  
The Private Company Council recently finalized a proposal that would make changes to GAAP to help simplify the private company accounting treatment for intangible assets acquired in business combinations, goodwill, variable interest-rate entities, and certain types of interest rate swaps.

The Financial Accounting Standards Board is currently considering the PCC proposal, and if endorsed, it will be issued as final Accounting Standards Updates to take effect for the period beginning after December 15, 2014.

This article looks at the "Big GAAP" vs. "Little GAAP" context for these developments, the elements of the PCC proposal, and also developments around the AICPA's new Financial Reporting Framework that gives small and medium-sized entities the option of adopting a more simplified and less costly method of presenting financial statements to stakeholders.

Owners and executives at private Los Angeles and Southern California businesses may want to consider talking with a CFO services professional to help determine how these developments might impact their companies’ accounting functions.

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