CPT V24P7-Art1 (Content).pmd - Taxmann

Accounts & Audit
actions. Therefore, the IAESB has suggested
significant amendments to IES 4 again.
Source: http://www.ifac.org/news-events/2012-
07/iaesb-proposed-revised-standard-professionalvalues-ethics-and-attitudes
7. FASB ISSUES ASU TO SIMPLIFY
TESTING OF INDEFINITE-LIVED
INTANGIBLE ASSETS FOR IMPAIRMENT-
JULY 27, 2012
7.1 Background - The Financial Accounting
Standards Board (‘FASB’) is a private, not-forprofit
organization whose primary purpose is
to develop generally accepted accounting
principles (‘GAAP’) within the United States in
the public interest. It was created in 1973,
replacing the Committee on Accounting
Procedure (‘CAP’) and the Accounting Principles
Board (‘APB’) of the American Institute of
Certified Public Accountants (‘AICPA’).
7.2 Summary - FASB has issued Accounting
Standards Update (ASU) No. 2012-02, Intangibles
—Good­will and Other (Topic 350): Testing
Indefinite-Lived Intangible Assets for Impairment,
to simplify the guidance for testing impairment
of indefinite-lived intangible assets other than
goodwill. This is applicable to intangible assets
including indefinite-lived trademarks, licenses
and distribution rights. The standard would
apply to all public, private and not-for-profit
organizations.
The amendments allow an organization to make
a qualitative evaluation about the likelihood
of impairment of an indefinite-lived intangible
asset to determine whether it should apply the
quantitative test and calculate the fair value
of the indefinite-lived intangible asset ?
Specifically, an organization has the option to
first assess qualitative factors (events and
circumstances) that could have affected the
significant inputs used in determining the fair
value of the indefinite-lived intangible asset
to determine whether it is more likely than not
(meaning a likelihood of more than 50 per
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cent) that the indefinite-lived intangible asset
is impaired.Under the amended guidance, an
organization may choose to bypass the qualitative
assessment for any indefinite-lived intangible
asset in any period and proceed directly to
calculate its fair value. The amendments do
not change how an organization measures an
impairment loss. Therefore, it is not expected
to affect the information reported to users in
financial statements.
7.3 Effective date - The amendments are effective
for annual and interim impairment tests
performed for the years beginning after
September 15, 2012. However, early adoption
is also permitted.
Source: http://www.fasb.org/cs/ContentServer?
site=FASB&c=Document_C&pagename=FASB%
2FDocument_C%2FDocumentPage&cid=
1176160199605
http://www.fasb.org/cs/BlobServer?blobkey=
id&blobwhere=1175824275038&blobheader=
application%2Fpdf&blobcol=urldata&blob
table=MungoBlobs
8. IESBA PROPOSES CHANGE TO CODE
OF ETHICS DEFINITION OF THOSE
CHARGED WITH GOVERNANCE - JULY
20, 2012
8.1 Background - The International Ethics
Standards Board for Accountants (‘IESBA’) is
an independent standard-setting board for the
purpose of developing and issuing high-quality
ethical standards and related guidance for
professional accountants worldwide in the public
interest. The IESBA develops the Code of Ethics
for Professional Accountants, which establishes
ethical requirements for professional accountants.
IFAC facilitates the structures and processes
of the IESBA.
IFAC is the global organization for the
accountancy profession, dedicated to serving
the public interest, having 167 members and
associates in 127 countries and jurisdictions.