Considered the industry standard resource, this guide provides practical guidance, essential information and hands-on advice on the many aspects of accounting and authoritative auditing for employee benefit plans. This new edition has been updated to include additional information related to the issuance of the going concern standard, revisions to provide further guidance related to limited-scope audits, a new illustrative auditor's report for 11-K audits, and has been revised for the recodification of the attestation standards.
Audit and Accounting Guide Employee Benefit Plans
Offsetting of Derivatives, Repurchase Agreements, and Securities Lending Transactions
“Pending Content” in FASB ASC 210-20-50 enhances disclosures about certain financial instruments and derivative instruments that are either offset in accordance with GAAP or are subject to an enforceable master netting arrangement or similar agreement. Accordingly, there may be additional disclosure requirements for plans that participate in securities lending or derivative and hedging activities. The scope of the disclosure requirements in paragraphs 2–5 of “Pending Content” in FASB ASC 210-20-50 is limited to recognized derivative instruments accounted for in accordance with FASB ASC 815, including bifurcated embedded derivatives, repurchase agreements, reverse repurchase agreements, and securities borrowing and securities lending transactions that are either offset in accordance with FASB ASC 210-20-45 or FASB ASC 815-10-45 or subject to an enforceable master netting arrangement or similar agreement.
In accordance with “Pending Content, in paragraphs 2–3 of FASB ASC 210-20-50, an entity should disclose information to enable users of its financial statements to evaluate the effect or potential effect of netting arrangements on its financial position for recognized assets and liabilities within the scope of “Pending Content” in FASB ASC 210-20-50-1. This includes the effect or potential effect of rights of setoff associated with an entity’s recognized assets and recognized liabilities. To meet the objective in “Pending Content” in FASB ASC 210-20-50-2, a plan should disclose at the end of the reporting period the following quantitative information separately for assets and liabilities that are within the scope of “Pending Content” in FASB 210-20-50-1:
As stated in “Pending Content” in paragraphs 4-5 of FASB ASC 210-20-50, the information required by the preceding paragraph should be presented in a tabular format, separately for assets and liabilities, unless another format is more appropriate. An entity should provide a description of the rights of setoff associated with an entity’s recognized assets and recognized liabilities subject to an enforceable master netting arrangement or similar agreement disclosed in accordance with “Pending Content” in FASB ASC 210-20-50-3(d), including the nature of those rights.
See the implementation guidance and examples that address the application of the disclosures for derivative instruments and other financial instruments in “Pending Content” in paragraph 1–22 of FASB ASC 210-20-55.
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Important Note: The 2019 edition has been updated to reflect adoption of FASB ASU 2017-06, Employee Benefit Plan Master Trust Reporting, effective for fiscal years beginning after December 15, 2018. For plans that are not early adopting FASB ASU 2017-06, we are continuing to offer the 2018 edition in all formats as a resource for requirements prior to the effective date of the ASU.
Whether you're a new or seasoned EBP auditor, you want your name to be on work you can be proud of. This guide is your ideal roadmap to compliance, giving you authoritative guidance, practical tips and illustrative examples to help you at each stage of the audit.
Flawlessly navigate every turn from acceptance to completion.
Designed to bridge the gaps between the what, why and how to satisfy your auditor responsibilities, this guide gives you confidence when issuing your audit reports, or when others are evaluating your work.
In the spotlight — Risk Assessment (including internal control) and Documentation
Updates in the 2019 edition
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