The health and wellbeing of members, exhibitors, staff, and other stakeholders is our top priority. Due to the growing concern around the coronavirus (COVID-19), and in alignment with the best practices laid out by the CDC, WHO, and federal and local governments, CFMA has made the difficult decision to cancel the 2020 CFMA Annual Conference & Exhibition. Please CLICK HERE for more information.

Constructing Change: The Private Company Council’s Efforts Heat Up!

On November 4, 2013, the Financial Accounting Standards Board (FASB) and Private Company Council (PCC) met at The Ohio State University to obtain feedback from constituents on the activities of the PCC. Constituents in attendance included preparers, auditors and users and the feedback from all three groups was robust with most in favor of the direction the PCC is going.

Subsequent to that meeting, on November 12, 2013, the PCC met to discuss its standard setting agenda; using the feedback obtained from the Ohio meeting and other previous meetings. Highlights of some of these projects include:

Applying Variable Interest Entity Guidance to Common Control Leasing Arrangements

The PCC approved its proposal whereby private companies will be provided an exemption from applying the existing variable interest entity consolidation model to common control leasing arrangements. As with all PCC proposals, this alternative must now be endorsed by the FASB. If endorsed, the final standard would likely be issued in either late 2013 or early 2014, with companies having the ability to early adopt.

Accounting for Goodwill Subsequent to a Business Combination

The PCC, at its previous meetings, proposed to allow among other expedients amortization of goodwill subsequent to a business combination. Amortization would be recorded over a period no longer than 10 years (with 10 years being the practical default period). The FASB plans to discuss the endorsement of this alternative at its November 25, 2013 board meeting. A final standard is expected to be issued in 2013, with an effective date of years beginning after December 15, 2014. Companies will have the ability to early adopt.

Accounting for Identifiable Intangible Assets in a Business Combination

The PCC and FASB continue to deliberate this proposal. Currently, the discussion is trending towards limiting recognition to only those acquired intangible assets that are capable of generating independent and distinct cash flows (e.g., tradenames). All other acquired intangible assets (e.g., non-compete agreements and relationships) would be recorded as part of goodwill. The PCC and FASB expect to continue their discussions on this topic in 2014.


The PCC continues to provide feedback to the FASB on certain of their “converged” standards. For example, at the November meeting, the PCC made it known that their view is to maintain a leasing model for private companies similar to existing accounting standards; while also recognizing that there does not appear to be a basis to have differences in lease accounting for private and public entities.