The FASB issued Accounting Standards Update (ASU) 2015-11, Inventory (Topic 330) - Simplifying the Measurement of Inventory, which requires that inventories, other than those accounted for under LIFO, will be reported at the lower of cost or net realizable value. image of inventory boxes

This Update is part of the Board’s Simplification Initiative, in order to, “...identify, evaluate, and improve areas of generally accepted accounting principles (GAAP) for which cost and complexity can be reduced while maintaining or improving the usefulness of the information provided to users of financial statements.”

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the-word-summaryA summarized report of the Invitation to Comment (ITC), Maintaining the Relevance of the Uniform CPA Examination, which was sent out to members of the accounting, finance and academic communities in September 2014, was recently released by the American Institute of CPAs. The ITC was a chance to “explore changes to the CPA profession and request feedback on possible changes to the next version of the Exam.”

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sticky-note-with-updates-written-on-itYou may have heard that there are a few changes happening to the CPA Exam that will be testable by July 2015.  While a couple of updates could be tested on the exam as early as July, other important updates won’t go into effect until later in 2015 or possibly as late as Q1 2016.

Please keep in mind that in cases where early adoption of a standard is permitted, it is the AICPA’s policy for that standard to be testable on the exam starting 6 months after the standard’s issue date.  Therefore it is vital to know the month in which a revised standard was issued.

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The Financial Accounting Standards Board (FASB) has issued a proposed Accounting Standards Update that will modify the accounting for bond issue costs (BIC). Currently, BIC is reported as a deferred charge in the asset section of the balance sheet and gets amortized separately on the income statement. Under the proposed revised standard, BIC will be treated similarly to a discount or premium and will be reported as an adjustment to the carrying value of the liability. Amortization of BIC will, along with amortization of discount or premium, adjust the amount reported as interest expense.

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The Accounting and Review Services Committee recently issued Statement on Standards for Accounting and Review Services (SSARS) No. 21 which represents the committees  efforts to clarify and revise the standards for reviews, compilations and engagements to prepare financial statements.

SSARS No. 21 is effective for reviews, compilations and engagements to prepare financial statements for periods ending on or after December 15, 2015. However, early implementation is permitted and the standard can be used now.

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In order to keep up with important changes within the CPA profession, the AICPA spend thousands of hours every year on the development of new examination questions.

As a quick reference guide, we've condensed the top content changes made to the AICPA's, "Content and Skill Specifications for the Uniform CPA Examination" document, below. Please note that these changes went into effect January 1, 2015.

Most of the 2015 CPA Exam changes are expected to appear on the Financial Accounting and Reporting (FAR) Exam.

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FAR Exam Changes



Are you up to date with the recent conversations happening around Big GAAP vs Small GAAP? Did you know that because early adoption is permitted, concepts mentioned in these conversations can be tested as early as the 4th quarter of this year (2014)? 


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The fact that the Financial Accounting and Reporting (FAR) exam tests student's knowledge of American Generally Accepted Accounting Practices (GAAP) is well known and to be expected.  However, many students have minimal experience with the International Financial Reporting Standards (IFRS), also covered by the exam.  



Despite any unfamiliarity, this should not cause undue concern; most questions will relate to GAAP. What's most important is understanding the key differences of financial statement preparation for IFRS, in comparison to GAAP. 


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IFRS, or International Financial Reporting Standards, is a topic that instills fear in the minds of students preparing to take the CPA exam.  In 2011, the American Institute of CPAs implemented big changes - one of them being the introduction of new questions testing IFRS.

 
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This morning, the AICPA announced some new features to be added to your CPA Exam. These updates will be put into effect very soon and could affect your testing experience. Here are the updates, in our short and sweet nutshell:

1. Starting October 1st, the calculator that you get to use on the CPA Exam will have a comma key. So if you're looking to punch in "one billion," you can do so by using the comma key and not get lost in all those zeroes. Also, you'll see an updated tutorial that will feature some new announcements (regarding changes to the exam).

2. If you're testing starting January 1st or onwards, you'll get a neat little timer on the introductory screen of the exam. This way, you don't use up too much time reading all that material (exam policies, copyright, section introductions). The timer will be set for 10 minutes. 

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