May 10, 2018
The Small Business Advisory Committee (SBAC) met on May 10, 2018. At the meeting, the the Financial Accounting Standards Board (FASB) staff delivered updates and SBAC members provided input on the following topics:
- Disclosure Framework: Disclosures by Business Entities about Government Assistance: SBAC members discussed the scope of the project, whether certain quantitative disclosures were operational, and the potential implications if disclosures were required only for individually material agreements.
- Income Taxes: SBAC members were complimentary of the FASB’s efforts to address recent financial reporting issues as a result of the Tax Cuts and Jobs Act by issuing the FASB's recent standard and five FASB staff Q&As. One member raised a potential concern about the lack of observed disclosures on certain aspects of the Tax Cuts and Jobs Act, which the FASB is monitoring more broadly. Members also discussed the potential implications of the FASB’s research project on Income Taxes—Backwards Tracing.
- Revenue Recognition: SBAC members discussed their experience and the initial costs of implementing the revenue recognition standard. Some of those implementation costs included additional systems and internal controls, as well as increased audit costs. Many of those implementation costs were expected to be nonrecurring or to decrease after the transition period.
- Open Discussion on Small Public Company Considerations: SBAC members discussed potential improvements to the Statement of Cash Flows, disclosures about share-based payment, the use of technology (such as blockchain) and its impact on financial reporting, as well as the FASB’s progress on their project on Financial Performance Reporting—Disaggregation of Performance Information.