The American Bar Association has called on the Financial Accounting Standards Board to put back the implementation date for proposals that would beef up disclosures on loss contingencies. ABA President Thomas Wells wrote to the FASB Sept. 18, asking that the Board delay bringing Statement 141(R) into effect past Dec. 15. FASB in June proposed changing both Statement 141(R) and Statement No. 5 to expand reporting on loss contingencies.
The ABA last month in a separate letter urged the Board not to adopt proposed changes to Statement 5, arguing that they would undermine attorney-client privilege and the work product doctrine during the audit process. The ABA said in its latest letter that many of the concerns it raised in regard to Statement 5 also apply to loss contingency provisions of Statement 141(R). The revised Statement 141(R), which will require disclosure of loss contingencies taken on as part of mergers and other business combinations, should not go into effect while these issues are being evaluated, Wells wrote. A spokesman for FASB did not return a call.