- While the Tax Cut and Jobs Act will simplify taxes for many Americans, many businesses and tax-exempt entities will find the computation of taxable income even more complex than in the past.
- The PCAOB said in its most recent standard-setting agenda that plans to continue working on the standards projects for accounting estimates and the use of specialists. The two related proposals are intended to strengthen the requirements when auditors scrutinize assets and liabilities that are hard to estimate, such as fair value measurements, oil company reserves, and actuarial forecasts.
- The PCAOB updated its staff guidance to help accounting firms comply with the requirements for the expanded audit reports they will have to begin filing in 2018. The update gives additional information to guide accounting firms when determining the tenure, or length of time they have served a client, that should be reported.
- The SEC wants to pay close attention to how the adoption of some of the FASB’s major standards may affect their financial reporting controls in 2018 and beyond. The new revenue standard becomes effective in 2018, and the lease accounting amendments have a 2019 compliance date. Because of the changes to the accounting requirements, public companies and their auditors are expected to face a number of challenges with testing internal controls and ensuring that they are sound.
- Since the Tax Cuts and Jobs Act was passed, many state and local officials, as well as commentators, have suggested prepaying such taxes by year-end to obtain a federal deduction prior to the limitation becoming effective.
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