What private company GAAP means to you

Description

Abstract: This summer, the Financial Accounting Standards Board proposed some revisions to Generally Accepted Accounting Principles to accommodate the needs of private businesses and their stakeholders. The proposals target four specific areas: intangible asset recognition, amortization and impairment of goodwill, certain types of interest rate swaps, and variable interest entities. This article shows how these proposals might affect private borrowers’ financial statements. A sidebar discusses the AICPA’s financial reporting framework that small private firms with relatively simple business models can use right now.