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Action Needed For Changes to
Private Company Financial Reporting |
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Dear Financial Leader,
Financial professionals and CPAs who work in private companies have been saying for a long time that these businesses have financial information needs that are much different from those of large public entities. Too much of what is included in current financial statements is not useful to private company owners, bankers/lenders and venture capitalists.
As you may know, the AICPA has been leading a call to make private-company financial reporting more relevant, more useful and less complex for businesses and their financial-statement users. The Financial Accounting Foundation (FAF) is considering two major recommendations of the Blue Ribbon Panel on Private Company Financial Reporting: differential standards and a separate board with standard-setting authority. The FAF is expected to discuss its final plan for private-company financial reporting this fall.
You can help with this historic effort by writing a letter to the FAF in support of private-company financial reporting. If you have not done so already, tell the Financial Accounting Foundation (FAF) what you think in your own words. If you or your colleagues and contacts would like help in crafting a letter to the FAF, consider using the AICPA’s online letter-writing assistant. In addition, the AICPA’s new PCFR Educational Toolkit for Private Companies and Other Stakeholders, can help you communicate the importance of this initiative to your bankers/lenders, private equity firms, accounting firms and others. Get more information and resources at the AICPA’s dedicated webpage.
Carol Scott, CPA, MBA
Vice President - Business, Industry & Government
American Institute of Certified Public Accountants
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