Aberystwyth University New Policy on Accounting Standards Discussions

Discussion 1

The FASB’s revised standard on leases, ASC 842, was effective for public companies beginning 2018. One significant implication of this standard is that operating leases that were previously kept off the balance sheet are now required to be recorded on the balance sheet as a liability.

Use the internet to learn more about FASB ASC Topic 842, Leases. Write a brief memo describing (a) whether you agree with the FASB’s decision to move operating leases to the balance sheet, (b) the expected magnitude of the operating lease liabilities that will be added to balance sheets in the United States, (c) how these new liabilities are being treated for purposes of computing debt covenant compliance by different users (investors, lenders, management), and (d) how the new treatment for operating leases affects the audit.

Points will be deducted for poor grammar and misspelled words.

Discussion 2

Both Intel (www.intel.com (Links to an external site.)) and Microsoft (www.microsoft.com (Links to an external site.)) have large amounts of investment securities. Visit their home pages, and review their financial statements for information on how they account for investment securities and the amounts of those securities. Describe your findings in a short memo.

Points will be deducted for poor grammar and misspelled words.