During 2015, the Financial Accounting Standards Board (the FASB) neared the conclusion of its major standard-setting efforts. In addition, the FASB issued a proposed Accounting Standards Update: Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement containing provisions that would alter disclosures related to areas including the market-based fair value hierarchy. The Public Company Accounting Oversight Board (PCAOB) continued revising auditing standards, affecting not only how audits are conducted but also auditors’ relationships and communications with audit committees, as well as the audit report itself. The SEC’s biggest financial reporting initiative, revisions to Regulation S-X on the reporting of investment company portfolio information, was part of its broader financial reporting modernization proposal (discussed in the Regulatory Section of this document).
In 2015 standard-setting groups, including the Securities and Exchange Commission (SEC) and the Financial Accounting Standards Board (the FASB), teamed up to test the mutual fund industry’s ability to adapt. Or so it seemed. In a series of decisions that defined, revised, and applied rules and standards in a number of areas—often aimed at improving the reliability of financial statements—the regulators championed transparency and simplicity. The desire to ensure that financial statements provide investors, lenders, and others with a more consistent, detailed, and yet a more focused picture of a company’s assets, obligations, and operations drove several of the FASB’s major 2015 efforts.