RESOURCES

Are You on Track with the SEC and FASB Regulations?
Prepared by The Playfair Group

Timeline for Calendar Year Companies:
 
June 30, 2001
Apply FASB Statements 141 and 142 to business combinations: 
1. End pooling-of-interest,
2. Use purchase method for subsequent business combinations, and
3. Cease to amortize goodwill and intangible assets with indefinite useful lives for subsequent business combinations.
 
August 14, 2001

Disclose effect of new rules in accordance with SAB 74
 
December 15, 2001

At the start of the fiscal year adopt FASB Statement 142, i.e. January 1, 2002 for calendar year entities: 
1. Reassess useful life of all recognized intangible assets,
2. Cease all amortization of goodwill and intangible assets with an indefinite useful life,
3. Reassess amortization period for intangible assets with definite useful life and adjust prospectively, and
4. Begin benchmark or transitional impairment test process for goodwill and intangible assets with indefinite useful lives.
 
March 31, 2002

1. Complete benchmark or transitional impairment testing for intangible assets with indefinite useful lives and record any impairment loss as the cumulative effect of a change in accounting principle as of January 1, 2002,
2. Complete useful life test of intangible assets and adjust prospectively where appropriate, and
3. All un-amortized negative or equity-method goodwill existing on an entity’s balance sheet at the date FASB Statement 142 is adopted is to be written off as of the date of adoption and reported in the interim period.
 
June 30, 2002

1. Complete Step 1 of the goodwill benchmark or transitional impairment test
2. Complete useful life test of intangible assets
 
August 14, 2002 - Disclose, as necessary, results in Forms 2Q and 10Q
 
September 30, 2002 - Complete useful life test of intangible assets
 
December 31, 2002

1. Complete Step 2 of the goodwill benchmark or transitional impairment test,
2. Restate all interim periods and record any impairment loss as a cumulative effect of a change in accounting principle as of January 1, 2002,
3. Complete useful life test of intangible assets,
4. Complete annual evaluation of factors used to determine useful life of intangible assets,
5. Ensure that the annual impairment test was also completed, unless transitional test was done on the first day of the fiscal year, and record any impairment loss against the operating results, and
6. Ensure that intangible assets with a definite life useful life undergo annual amortization
 
Useful Life Dates
 
Reassessment of recognized intangible assets

1. Commence at the beginning of fiscal year that FASB Statement 142 is adopted
2. Complete reassessment by the end of the first interim period
3. Evaluation of useful life of intangible assets each reporting period (FASB Statement 142, paragraph 14)
4. Evaluation of factors used to determine useful life annually

 Impairment Test Dates