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FASB issues Statement no. 147, Acquisitions of Certain Financial Institutions (www.fasb.org/news/nr100102.shtml). It provides guidance on accounting for all such purchases, except for transactions between two or more mutual enterprises—which will be the subject of separate, upcoming FASB guidance.

To explore how adopting a principles-based approach to setting accounting standards might improve the quality and transparency of financial reporting and affect development of future standards, FASB issues a proposal (www.fasb.org/proposals/principles-based_approach.pdf) and seeks comments on it by January 3. Those wishing to participate in a related public roundtable discussion on December 16 should e-mail their remarks by December 2 to director@fasb.org.

The Institute of Internal Auditors (www.theiia.org) issues for its members a summary of several regulatory organizations’ current and proposed corporate governance requirements aimed at improving the accuracy, completeness and transparency of financial statements. The regulations specify what boards of directors, audit committees and corporate managers must do to comply with provisions of the Sarbanes-Oxley Act, with the SEC’s forthcoming interpretation of them and with rules under development at the New York and American stock exchanges and the National Association of Securities Dealers.

Comptroller of the Currency John D. Hawke says banks owned by financial conglomerates should better protect their interests—by insisting on reasonable compensation—when dealing with affiliated organizations that want to sell products to bank customers (www.occ.treas.gov/ftp/release/2002-78.doc). Hawke recommends several additional ways—including adopting corporate governance standards—banks can preempt government intervention and retain their self-regulatory powers.

U.S. companies will pay on average 15.4% more in 2003 to provide their workers with health insurance than they did this year, when rates climbed 13.7%, says consulting group Hewitt Associates (http://was.hewitt.com/hewitt). Some corporations will absorb most of the increase, but others will ask employees to contribute more than in the past. Next year, workers will pay on average 19% of the cost of their own coverage and 24% of dependent care premiums. Hewitt bases its projections on information from more than 2,000 U.S. health plans.

The Federal Accounting Standards Advisory Board issues Technical Bulletin 2002-2, Disclosures Required by Paragraph 79(g) of SFFAS 7, Accounting for Revenue and Other Financing Sources and Concepts for Reconciling Budgetary and Financial Accounting (www.fasab.gov/pdf/tb20022.pdf). The bulletin explains to users, preparers and auditors what disclosures a federal financial reporting entity should make to comply with Statement 7 when issuing financial statements for a given fiscal year before the U.S. government publishes the actual amounts for that period.

The International Federation of Accountants releases two international public sector accounting standards (IPSASs) (www.ifac.org). IPSAS 19, Provisions, Contingent Liabilities and Contingent Assets, defines the terms to which its title refers and establishes the criteria for recognizing and disclosing provisions and the rules for measuring them. IPSAS 20, Related Party Disclosures, requires entities to reveal ties that involve significant control by or over the entity, as well as information about transactions—between an entity and related parties—that take place outside normal supplier or client-recipient associations.

The Treasury Department issues three rules relating to the USA Patriot Act and financial institutions’ and CPAs’ roles in the fight against money laundering (www.treas.gov/press/releases/po3436.htm). The new regulations, which the Treasury’s Financial Crimes Enforcement Network will administer, amends and adds provisions to the Bank Secrecy Act, which governs most of the registration, recordkeeping, reporting and control obligations financial institutions and individuals, including CPAs, have with respect to money laundering. (See “The CPA’s Role in Fighting Money Laundering,” JofA, Jun.01, page 88) Among the topics the rules address are suspicious activity reporting, anti-money-laundering-program requirements, prohibitions on maintaining accounts for foreign shell banks and information sharing between the government and the financial community.

The portfolios of financial advisers’ clients suffered heavy losses in 2001 and early 2002 as the S&P 500 stock index fell sharply. But by bringing in new business and thus increasing their total client holdings by 16.7%, the advisers limited to 5.3% the decline in assets under their management, says a study produced by Moss Adams LLP (www.mossadams.com/industry/investment.htm). The report describes the strategies the investment advisers used to achieve these results.

The SEC proposes two rules governing mutual funds’ and investment advisers’ proxy voting on behalf of their investors and clients, respectively. The first proposal (www.sec.gov/rules/proposed/33-8131.htm) would require mutual funds to disclose the policies and procedures they use to determine how to vote proxies relating to their shareholders’ securities. Fund companies also would have to make available records of the specific votes they cast. The second proposed rule (www.sec.gov/rules/proposed/ia-2059.htm) would assign the same responsibilities to investment advisers. Comments on both proposals are due December 6.

The SEC appoints Scott A. Taub, CPA, its deputy chief accountant. A recent partner of Andersen’s professional standards group in Chicago, Taub previously had served with the commission as a professional accounting fellow.

John T. Smith, CPA, joins the International Accounting Standards Board as a part-time member, filling the post Robert H. Herz vacated to become FASB chairman. Smith, a partner of Deloitte & Touche USA LLP, who has expertise in standard-setting issues and in accounting for financial instruments, will remain a member of his firm while serving on the board for a five-year term ending June 30, 2007.