Pwc's Cfodirect Podcast

In the third quarter 2023 edition of The quarter close, we highlight the SEC’s final rule on cybersecurity, which will require new reporting and disclosures for many companies beginning next quarter. We also provide key reminders when accounting for debt restructurings, updates on sustainability reporting, and the latest FASB standard-setting developments. Read or listen to The quarter close for these and other relevant accounting and reporting topics you should consider as you close out the third quarter of 2023.Transcripts available upon request for individuals who may need a disability-related accommodation. Please send requests to us_podcast@pwc.com.

Every Tuesday in September, Craig Stronberg, PwC’s Macro Intelligence Leader, is taking over the podcast to share insights on how geopolitical and macroeconomic trends, forces, and movements are likely to impact your business.To continue the series, Craig is joined by Zain Siddiqui, PwC senior economist, to discuss the current state of the global supply chain and how companies should evaluate their supply chain strategies.In this episode, you’ll hear a discussion of:2:07 - The current state of the global supply chain5:55 - How companies should think about their supply chain business strategies in light of external factors and risks11:21 - The impact of government policy on economic policy and the incentives for domestic production21:02 - Sector- and geographic-specific insights on supply chain challenges and opportunities, including:28:55 - The impact of geographical diversification on supply-chain resiliency30:55 - Expectations for long-term trends in the global supply chain33:54 - Final advice for companies

In today’s episode, sustainability and financial reporting intersect. We discuss accounting for green incentives that arise from the Inflation Reduction Act (IRA). The IRA, signed into law in August 2022, provides climate and clean energy tax credits. With many types of credits available in the IRA, companies have raised questions about the financial accounting implications of the credits given the unique features that these credits have compared to past federal incentives. This week, Heather Horn is joined by Pat Durbin, a Deputy Chief Accountant in PwC’s National Office, and Jillian Pearce, a partner in our utilities practice, both of whom have closely followed accounting for the credits, to discuss what to look out for in accounting for IRA tax credits.In this episode, you’ll hear discussion of:2:38 - The background, including the breadth, scope, and structure of available IRA credits7:45 - The different pathways to realization of tax credits11:45 - How companies should allocate consideration paid for IRA

Every Tuesday in September, Craig Stronberg, PwC’s Macro Intelligence Leader, is taking over the podcast to share insights on how geopolitical and macroeconomic trends, forces, and movements are likely to impact your business.To continue the series, Craig is joined by Zain Siddiqui, PwC Intelligence senior economist, to discuss India’s economy and the risks and opportunities it presents for companies worldwide.In this episode, you’ll hear a discussion of:4:50 - India’s evolving role as a key player in the global economy10:54 - The driving factors, including population growth and its impact on the labor market, contributing to India’s positioning as a global force 16:54 - Considerations that are key to understanding India’s economy, its influence and challenges, including:18:15 - Human capital - education, job creation, and equal opportunities in India27:50 - India’s economic tendencies as a domestic-driven, consumption heavy, services economy32:12 - India’s business sentiment and power to influence the global

Every Tuesday in September, Craig Stronberg, PwC’s Macro Intelligence Leader, is taking over the podcast to share insights on how geopolitical and macroeconomic trends, forces, and movements are likely to impact your business.To kick off the series, Craig provides an overview of the global macroeconomic and geopolitical forces — the true “tectonic” forces — impacting companies in the near and longer term.In this episode, you’ll hear a discussion of:3:52 - Disequilibrium - what it means, where it stands, and what comes next8:29 - Identifying and understanding the forces impacting the global economy 15:02 - Why it’s important for companies to understand their business assumptions and how those assumptions may be changing20:49 - Assessing major global forces and their impacts on our economy, including:20:55 - Geopolitical disruption, protectionism, and the impact on free trade28:39 - Polarization and its impact on risk management and business decisions38:06 - Balancing between trust and distrust in governments a

Every Tuesday in August, Bret Dooley, Deputy Chief Accountant in PwC’s National office, is taking over the podcast to share insights on financial instruments hot topics. In each 25-minute episode, Bret will discuss 5 things you need to know.In this episode, Bret is joined by John Horan, a managing director in PwC’s National office with a focus on financial instruments, to break down what we need to know on earnings per share (EPS).In this episode, you’ll hear:2:20 - Reminders on the basic EPS calculation, including considerations for participating securities and application of the the two-class method11:45 - The impact of mezzanine equity on the basic EPS calculation15:12 - The impact of new FASB guidance (ASU 2020-06) on EPS calculations for contracts that can be settled in cash or shares 20:01 - Complexities in the dilution calculation for liability-classified warrants and convertible debt with bifurcated conversion options21:48 - Why companies should evaluate repurchased convertible instruments separatelyF

Every Tuesday in August, Bret Dooley, Deputy Chief Accountant in PwC’s National office, is taking over the podcast to share insights on financial instruments hot topics. In each 25-minute episode, Bret will discuss 5 things you need to know.In this episode, Bret is joined by Chip Currie, another partner in PwC’s National office with a focus on financial instruments, to discuss convertible instruments and the impacts of updated accounting guidance in this area.In this episode, you’ll hear discussion of:1:38 - Why companies use convertible instruments and the complex financial decisions accompanying their use6:38 - The impact of new accounting guidance for convertible instruments in ASU 2020-06 9:49 - Key information when accounting for induced conversions12:10 - Down round provisions in equity-linked instruments19:27 - Judgments involved in determining whether to separate the conversion option and account for it as an embedded derivative For more information, read chapter 6 of our Financing transactions guide

The transformation of ESG reporting accelerated in 2022 with the release of major proposals in the European Union (EU) and the United States (US), as well as globally by the International Sustainability Standards Board (ISSB).Although all of these proposals have the potential to impact multinational companies, the Corporate Sustainability Reporting Directive (CSRD) from the EU that applies to many multinational companies perhaps requires the most immediate attention. In this episode, Heather Horn brings you an audio version of our In the loop covering the CSRD. In this podcast, you’ll hear:3:12 - Past, present, and future of EU sustainability reporting8:48 - Scope and timing29:45 - Reporting under the CSRD50:43 - Requirement for third-party assurance51:24 - Filing requirements of the CSRD59:54 - What’s next?Refer also to the print version, Worldwide impact of CSRD - are you ready? Also, join our upcoming Q4 2023 Quarterly sustainability webcast.Heather Horn is PwC’s National office thought leader, responsible

Every Tuesday in August, Bret Dooley, Deputy Chief Accountant in PwC’s National office, is taking over the podcast to share insights on financial instruments hot topics. In each 25-minute episode, Bret will discuss 5 things you need to know.In this episode, Bret shares insights on the current expected credit loss model, or CECL, and why it’s not just for banks. All companies, regardless of industry, need to understand the requirements.In this episode, you’ll hear:1:50 - A refresher on CECL3:34 - Insights on the impacts of CECL across industries7:03 - A discussion of how to apply CECL to various asset classes, considerations on estimation methodologies, and why companies should seek continuous improvement in the application of CECL9:32 - Key information to consider when preparing CECL disclosures 11:22 - How subsequent events could impact CECL estimates20:43 - An overview of the FASB’s exposure draft that proposes changes to the accounting for purchased credit deteriorated assetsFor more information, read chap

Every Tuesday in August, Bret Dooley is taking over the podcast to share insights on financial instruments hot topics. In each episode, Bret will discuss 5 things you need to know in 25 minutes.To kick off the series, Bret shares insights on accounting for investment securities, a topic of recent headlines. He breaks down the complexities of held-to-maturity and available-for-sale securities, and touches on foreign currency bonds.In this episode, you’ll hear discussion of:2:05 - Key reminders for identifying and accounting for debt securities6:32 - Accounting for held-to-maturity (HTM) securities and the long-term implications of HTM designation12:30 - Tips on accounting for unrealized losses on available-for-sale (AFS) securities17:18 - An overview of accounting for foreign currency bonds19:25 - Complexities in the application of the measurement alternative model for equity securities For more information, read chapters 2, 3, and 8 of our Loans and investments guide. Bret Dooley is a Deputy Chief Accountant

Every Tuesday in July, Jay Seliber is taking over the podcast to share insights on business combinations, which are often significant events in a company’s life cycle. Jay takes us on a journey through a deal, beginning with the complexities of the overall acquisition accounting model, then diving into some of the more complex areas—identifying the accounting acquirer, accounting for contingent consideration, and reporting with the SEC.To continue the series, Heather and Jay are joined by Ryan Spencer, a PwC National office partner who specializes in SEC reporting, to break down the SEC filing requirements for business combinations, including the application of significance tests used to determine the reporting requirements.In this episode, you’ll hear:2:02 - A breakdown of the SEC filing requirements for business combinations7:10 - A discussion of significance tests and how they help to determine filing requirements17:36 - A summary of financial statement requirements, including considerations on timing and

Sustainability disclosure regulations around the world are evolving rapidly, and as this reporting begins to proliferate, so does the potential for a mismatch between the expectations of investors and other stakeholders compared with the reality of what’s actually happening.Are there expectation gaps in sustainability reporting, and if so, what are they? This week, Heather Horn was joined by Gilly Lord, PwC’s Global Leader for Public Policy and Regulatory Affairs, to discuss the current global regulatory landscape, the evolving sustainability reporting ecosystem, and the importance of regulators and other ecosystem participants finding common ground in the areas that matter most for reliable sustainability reporting.In this episode, you’ll hear discussion of:2:20 - Sustainability expectation gaps - what are they?14:24 - How the breadth of sustainability reporting is partially responsible for expectation gaps25:50 - How assurance standards are evolving, and what elements of future standards may help to address

Every Tuesday in July, Jay Seliber is taking over the podcast to share insights on business combinations, which are often significant events in a company’s life cycle. Jay takes us on a journey through a deal, beginning with the complexities of the overall acquisition accounting model, then diving into some of the more complex areas—identifying the accounting acquirer, accounting for contingent consideration, and reporting with the SEC.To continue the series, Heather and Jay are joined by Chip Currie, another partner in PwC’s National Office, to share insights on the intersection between contingent consideration and acquisition accounting, as well as the key decision points in the multi-step accounting model.In this episode, you’ll hear:2:25 - An overview of the accounting framework for contingent consideration arrangements from the buyer’s perspective, including:7:01 - The criteria for meeting the definition of contingent consideration12:04 - An assessment of whether the arrangement is part of the purchase p

The International Sustainability Standards Board (ISSB) published its Consultation on Agenda Priorities in May 2023. Now that the final IFRS S1 and S2 standards have been issued, the ISSB is asking constituents to weigh in on the board’s focus areas and research projects for the next two years.What should companies consider when preparing to comment on this request? This week, Heather Horn was joined by Andreas Ohl, PwC’s Global Sustainability Technical Leader, to discuss the options laid out in the board’s agenda consultation, and the factors companies may want to contemplate in their responses.In this episode, you’ll hear discussion of:2:15 - What the ISSB says it is looking to accomplish with this agenda consultation6:52 - A potential research project on biodiversity, ecosystems, and ecosystem services15:02 - A potential research project on human capital17:56 - A potential research project on human rights25:19 - Previous feedback the ISSB and IASB received to consider ways to work jointly on key projects30

Every Tuesday in July, Jay Seliber is taking over the podcast to share insights on business combinations, which are often significant events in a company’s life cycle. Jay takes us on a journey through a deal, beginning with the complexities of the overall acquisition accounting model, then diving into some of the more complex areas—identifying the accounting acquirer, accounting for contingent consideration, and reporting with the SEC.To continue the series, Heather and Jay are joined by Matt Sabatini to share insights on the identification of the accounting acquirer, a key judgment that impacts the remaining accounting conclusions in the acquisition model.In this episode, you’ll hear:1:46 - A discussion of the importance of determining the account acquirer as the starting point, and the downstream implications of that determination3:50 - An overview of the accounting framework from the acquirer’s perspective and the intersection with consolidation standards 6:18 - Insights on performing a control assessment

The International Sustainability Standards Board (ISSB) issued final IFRS® Sustainability Disclosure Standards on June 26, 2023. While IFRS Sustainability Disclosure Standards are not yet required in any jurisdiction, multiple jurisdictions around the world have already signaled their intent to adopt the new standards, with additional jurisdictions expected to do so now that the standards are final.What can companies find inside the new Sustainability Disclosure Standards? This week, Heather Horn was joined by Katie Woods, PwC UK director, to discuss the expected breadth of adoption internationally and the important considerations in advance of adoption.In this episode, you’ll hear discussion of:1:48 - The final IFRS Sustainability Disclosure Standards: IFRS S1 and IFRS S27:06 - The current status of adoption of the Sustainability Disclosure Standards in international territories11:43 - The interconnectivity between IFRS Sustainability Disclosure Standards and IFRS Accounting Standards19:12 - Key changes betw

Every Tuesday in July, Jay Seliber is taking over the podcast to share insights on business combinations, which are often significant events in a company’s life cycle. Jay takes us on a journey through a deal, beginning with the complexities of the overall acquisition accounting model, then diving into some of the more complex areas— identifying the accounting acquirer, accounting for contingent consideration, and reporting with the SEC. To kick off the series, Jay shares insights on the foundations of acquisition accounting, including key areas of judgment in the model.In this episode, you’ll hear discussion of:1:58 - The importance of understanding acquisition accounting, even in times of low deal volume3:50 - The foundational accounting considerations for business combinations, including the determination of which transactions qualify as business combinations, and the implications on the control assessment8:04 - The acquisition method, including how to account for the various forms of consideration exchang

The European Union’s (EU’s) Foreign Subsidies Regulation (FSR) was enacted to extend existing EU state aid rules, which govern the fairness of trade among states within the EU, to subsidies received from jurisdictions outside the EU, and includes incentives such as those provided by the US Inflation Reduction Act (IRA).What are the parameters of the new regulation, and how could it impact the realizability of climate incentives for your company? Heather Horn was joined by Barry Murphy and Allard Knook, PwC partners, to unpack these questions and provide the latest insights on the FSR, as well as available EU tax incentives.In this episode, you’ll hear discussion of:2:38 - How the US IRA has shaped global regulatory agendas for state aid8:13 - How the EU is providing its own incentives currently17:14 - An overview of the Green Deal Industrial Plan24:02 - The FSR rules, and their potential impact to non-EU companies36:33 - The underlying policy objectives of the FSR, and how the FSR complements EU climate incen

The International Sustainability Standards Board (ISSB) issued final IFRS® Sustainability Disclosure Standards on June 26. This included IFRS S1, which provides the core framework for the disclosure of material information about sustainability-related risks and opportunities across an entity’s value chain, and IFRS S2, which is the first thematic standard issued that sets out requirements for entities to disclose information about climate-related risks and opportunities.What’s ahead for sustainability reporting globally now that these standards are final? This week, Heather Horn was joined by Sue Lloyd, Vice-Chair of the ISSB, to discuss the complex process of finalizing its global baseline standards, the forthcoming impact to companies, and the expected breadth of adoption internationally.In this episode, you’ll hear discussion of:1:26 - How the ISSB brought the standards to the finish line, including the biggest obstacles along the way10:12 - Noteworthy changes from the initial draft standards to the final

Every Tuesday in June, Angela Fergason is taking over the podcast to share the latest in her areas of specialty — including recent trends in revenue, how to consider whether your company is a principal or agent when recognizing revenue, software costs, and restructurings.To continue the series, Angela shares insights on some accounting implications of workforce restructuring, including the different accounting models available for termination benefits.In this episode, you’ll hear:1:08 - An overview of the various accounting models applicable to workforce restructuring eventsInsights on accounting for:3:55 - One-time involuntary benefits, including severance payments8:54 - Termination benefits under an existing plan14:50 - Voluntary termination benefits and other benefit combinations 20:03 - Modifications of stock-based compensation awards, including both vested and unvested awards28:36 - Extending the exercise period of stock-based compensation awards31:14 - Final advice on accounting for workforce restructur