Brief overview of new accounting rules for 12/31/21 financial statements.

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To help auditors in the CPA community, the AIPCA peer review staff publishes PR Prompts, a newsletter with information for firms providing audits, review, compilations, and other attestation services.

The newsletter is unbranded and AICPA gives explicit permission to peer reviewers to put their logo and branding information on the newsletter. Those of us who are peer reviewers have specific permission to send it to our clients.

The following comments are provided to you courtesy of the AICPA.  I gratefully acknowledge their work in preparing this info and gladly share it with you. 

For ease of reading, I will not put all the following material in quotations.

One section of the newsletter provides background on new accounting rules that will be required in the near term:

PR Prompts – Fall 2021:

Upcoming accounting standards updates (ASUs) not-for-profits (NFPs) should be familiar with at the end of 2021

The following is a summary of FASB ASUs with initial effective dates for most NFPs beginning in calendar-year 2021 and for 2020-2021 fiscal year-ends, or with effective dates that were deferred to 2021. Also, summarized are ASUs on the horizon with effective dates for most NFPs in 2022 and later. Additional information and guidance related to a number of these ASUs can be found in this AICPA article.

Another inflation followup.

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Distressing inflation news keeps rolling in…

Multiple comments from senior federal officials indicate we are going to have inflation for a while.

Treasury Secretary Janet Yellen indicated inflation will continue into 2022.

She indicates the source of inflation is bottlenecks that have themselves generated inflation. Unstated in the article, and apparently unacknowledged by Secretary Yellen, this these bottlenecks are caused by the government shutting down the economy and in their staggering hubris thinking they can flip a switch and seamlessly open up the economy.

CNBC – 10/5/21 – Yellen sees inflation staying higher for the next several months.

Article also points out Fed chairman Powell called inflation news last week “frustrating.” I suppose so. When you think you can control the economy of the world with a few keystrokes from your laptop, such news would be quite frustrating.

Most unsettling tidbits in the article are the estimates from the Federal Open Market Committee that inflation measured by the PCE will be 3.7% in 2021. THey think it will be lower next year. I hope so.

St. Louis Fed President predicts 2.8% for the full year of 2022.

A bit more on that high inflation rate seen in August PCE.

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Few days ago we discussed the Personal Consumption Expenditure for August 2021 shows ongoing inflation.

The August number of 0.4% increase results in a year-over-year increase of 4.3%. Bad news is this is the highest increase in PCE since 1991, all the way back when Pres. Bush was in office.  That is a 30-year high in the inflation rate as measured by PCE.

Another major investigation of bank secrecy: Pandora Papers.

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Looks like there is another flood of reporting ready to appear in print on bank secrecy and hiding wealth.

This project will be called the Pandora Papers.

If you recall, a major series of reports back in the 2016 timeframe described money laundering efforts flowing through one particular law firm in Panama. You can read my comments on the coverage.

The International Consortium of Investigative Journalists (ICIJ) brought together around 600 journalists from about 150 media outlets to analyze a data leak with 2.94 TB of info. That’s terabytes, as in thousands of gigabytes.

The ICIJ kickoff summary was published on 11/3/21: Pandora Papers: An offshore data tsunami.

If you are at all interested in offshore banking, or money laundering, or the world-far-away of hiding or relocating wealth even without nefarious intent, you will want to pay attention.

Looks like there will be a lot of coverage, what with 330 politicians and 130 people on the Forbes billionaire list showing up in the data.

From a first glance, it looks like this project have as one focus the structure of banks and professionals that service this market.

Personal Consumption Expenditure for August 2021 shows ongoing inflation.

The Personal Consumption Expenditure (PCE) inflation index again shows an increase of 0.4% in August 2021 after increasing the same in July. Since December 2020 this index has shown inflation of between 0.3% and 0.6% each month.

This indicates that inflation is continuing. Good news is that inflation is slowing, declining from 0.6% in March and April, to 0.5% in May and June, to 0.4% in July and August.

Bad news is annualizing the running three month inflation rate shows between 4% and 7% since February.

Total number of people drawing state and federal unemployment is declining slowly.

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The number of people with continuing claims for unemployment in the regular state programs and Pandemic Emergency Unemployment compensation programs is volatile, showing large swings from week to week. However, the total does not seem to dropping very fast.

Since the week of 9/19/20, I have been pulling that data off the weekly press release from the Department of Labor. Current weekly report is: Unemployment insurance weekly claims.

The weekly data since then, excluding one week I missed, is: