Report: There’s Nothing Extraordinary About Sandy

Posted on by Caleb Newquist

Companies are unlikely to be allowed to classify damage from Hurricane Sandy as “extraordinary” for financial reporting purposes, but may consider including additional disclosures on how their businesses were impacted, according to a report from PricewaterhouseCoopers. “Neither the September 11, 2001 terrorist attacks nor Hurricane Katrina in 2005 were considered to be extraordinary from an accounting perspective,” the report said. “Accordingly, we believe that classification of losses relating to Hurricane Sandy within continuing operations would be appropriate.”  [CFOJ]

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Kroeker Gets Cranky With the AICPA’s Private Company Accounting Ideas

Apparently SEC chief accountant James Kroeker does not appreciate the AICPA’s disapproval of the FAF’s new proposal to set up a Private Company Standards Improvement Council, calling the disapproval “a clear threat to the independence of the FAF.”

Accounting Today has the entire story but the short version is that Kroeker went off at Monday’s Standard & Poor’s Accounting Hot Topics Conference in New York, calling the AICPA’s resolution “egregious.”

In case you forgot, at last month’s fall meeting of AICPA Governing Council, members overwhelmingly approved a resolution that sent the Financial Accounting Foundation (FAF) a strong message: either FAF moves to adopt the Blue Ribbon Panel on Standard Setting for Private Companies’ (the Panel) recommendations for a separate board— which is the AICPA’s preference— or the AICPA will consider other options.

At that time, the AICPA made it clear that if FAF continued to pursue its current proposal, the AICPA board of directors would look at other solutions for addressing the needs of private companies. This could include creating a separate standard setting body to develop private company generally accepted accounting principles (PCGAAP) or a comprehensive private company-specific basis of accounting that would deliver meaningful, lasting improvement to private company financial reporting consistent with the Panel’s recommendations.

Maybe Kroeker should go hang with the AICPA and cuddle up to watch the upcoming webcasts that outline FAF’s proposal?

We’re not sure why Kroeker is so butthurt, nor why he would dare take on 350,000 CPAs by calling their wishes “egregious” but that’s a different matter entirely.