For those who do not provide services to public companies, December 31, 2005 was the first year-end date for which many CPAs have been helping their clients implement the provisions of FASB Interpretation 46 (revised in
December 2003).

In the two years since FIN 46(R) was issued, CPAs have worked diligently to gain an understanding of the requirements of FIN 46(R) and how those provisions impact their clients. In response to member inquiries, the MACPA Accounting & Auditing Standards Task Force recently wrote a letter to the FASB regarding the implementation difficulties for smaller clients.

Issues identified by the A&A Standards Task Force include the following:

• Complexity and understandability of the standard
• Emergence of alternative implementation methods
• Cost benefit considerations.

In addition to outlining areas of concern, the Task Force urged FASB to consider simplifying FIN 46 with regard to non-public entities or exempt small non-public business entities from the consolidation provisions of the Interpretation, but retain expanded disclosure of the information relevant to variable interest entities through existing related party disclosures.

The Task Force also asked FASB to consider a retroactive delay in the implementation effective dates for non-public entities until further clarifications are made and guidance for implementation is provided.

For further information, read the MACPA Accounting & Auditing Standards Task Force letter, or contact the MACPA Government Relations & Regulatory Affairs Department at 248.267.3700.

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