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The Financial Accounting Standards Board (FASB) released a series of upcoming rules earlier last year that will soon go into effect. Businesses need to be aware that many of these new regulations will be in place sometime in 2017, so it’s important to understand and prepare for the changes that will occur. Some of these changes impact life insurance and hedge accounting, among other accounting related areas.

Long-term projects and feedback

A few months ago, the FASB invited companies to contribute feedback about any new projects they felt that the FASB should take on, mainly centered around examining current rules and regulations that may need to be updated in the upcoming years. They also cautioned interested parties to realize that these projects may take 8-10 years to review and finish. The FASB later held a roundtable discussion to determine what areas were the most important to focus on.

Financial reporting disclosures

A main goal of the FASB is to further improve financial reporting disclosures. Russell Golden, the chairman of the FASB says that “depending on the feedback we received, we will then be moving forward to complete all of those phases of the disclosure framework project in 2017 and 2018.” These updates may lead to required disclosures on pensions, income taxes, and other financial matters.

Simplified rules

Though many new rules and regulations are being implemented, the FASB wants to create simplified rules that make the requirements for certain tasks, like when the government hires a private company to run a government-owned facility, more clear and specific so there is no confusion over how to handle different issues. These rules are being changed in an effort to provide clarity for certain issues, but the need regulations are more narrow than they once were.

FASB assistance

Finally, the FASB encourages even more feedback on their overall work and how they can improve various areas. They also offer help to some companies trying to implement these new regulations. The many changes that the FASB is working on “represent the most extensive overhaul in decades in U.S. financial reporting, and will have widespread impacts that vary across sectors.” It’s important for businesses to understand these new rules and also prepare for the extreme changes that will result from them.