PwC's accounting podcast

Text us your thoughts on this episode

In the second quarter 2022 edition of The quarter close, PwC’s Deputy Chief Accountants provide their thoughts on what should be top of mind when considering accounting and reporting in the current economic environment. We also provide updates on the SEC’s climate and cyber disclosure proposals and the FASB’s new standard-setting projects.

Read The quarter close for these and other relevant accounting and reporting topics you should consider as you close out the second quarter of 2022.

Transcripts available upon request for individuals who may need a disability-related accommodation. Please send requests to [email protected].

In our Toolkit podcast series, we take a deep dive into one accounting topic each month that goes beyond the basics and into areas that require judgment. This month, we are covering leasing–a multifaceted area that generates numerous questions. 

In this episode, Heather Horn was joined by Chad Soares and Marc Jerusalem from our National Office to breakdown the complexities of sale-leaseback transactions and build-to-suit lease arrangements.

In this episode, you will hear:

• 1:24 - An overview of sale-leaseback transactions, including how the accounting changed in the updated leases standard
• 7:59 - A deeper dive into meeting the risks and rewards of ownership criteria and the treatment of purchase and put options  
• 18:50 - Accounting for sale-leasebacks and questions about fair value
• 24:50 - What to do when transactions don’t qualify for sale-leaseback accounting
• 31:10 - An overview of build-to-suit arrangements and changes from the more form driven prior guidance 
• 39:42 - Things to look out for in sale-leaseback and build-to-suit transactions
• 42:18 - Final advice for dealing with these complex arrangements

Want to learn more? Listen to our previous podcasts in our Leasing toolkit series on private company adoption and how to get lease measurements and modifications right. 

Chad Soares is a partner in PwC's National Office focused on leasing and financing arrangements. He was a primary author of PwC’s Leases guide and continues to contribute to a variety of thought leadership related to leasing and financial instruments.

Marc Jerusalem is a Director in PwC’s National Office specializing in leasing. Marc consults with clients on complex lease accounting issues and is a frequent contributor to many related PwC National Office publications.

Heather Horn is PwC’s National Office thought leader, responsible for developing our communications strategy and conveying firm positions on accounting and financial reporting matters. She is the engaging host of PwC’s accounting and reporting weekly podcast and quarterly webcast series. With over 30 years of experience, Heather’s accounting and auditing expertise includes financial instruments and rate-regulated accounting.

Transcripts available upon request for individuals who may need a disability-related accommodation. Please send requests to [email protected].

Did you enjoy this episode? Text us your thoughts and be sure to include the episode name.

Did you enjoy this episode? Text us your thoughts and be sure to include the episode name.

On March 21, the SEC published a widely anticipated proposal to enhance companies' climate-related disclosures. In addition to details regarding how management identifies, assesses, and manages climate-related risks and the related impact on financial metrics, the proposal calls for companies to provide information about how their boards provide oversight of climate-related matters.

In this episode, Heather Horn was joined by Brigham McNaughton, a managing director in PwC’s ESG practice, to discuss the challenges and opportunities companies face as they consider how to implement the SEC's climate disclosure proposal.

In this episode, you will hear:

• 1:13 - An overview of the implementation questions companies are asking
• 4:53 - Physical and transition risk disclosure requirements of the proposal, and how those terms are defined
• 17:08 - Navigating the 1% rule for the financial statement disclosures
• 21:14 - How companies can ensure their processes, controls and data are sufficient to meet the proposal requirements
• 28:04 - Emissions disclosures and using carbon offsets, and the related attest considerations
• 35:45 - What to focus on when developing new climate goals and targets
• 43:28 - Global outlook - the CSRD and ISSB proposals
• 48:53 - Final advice on the future of ESG reporting

Want to learn more about the SEC’s proposal? Listen to our previous podcasts that provide a closer look at governance, related investor perspectives, and legal and regulatory perspectives. Also refer to the text or audio version of our In the loop, The SEC wants me to disclose what?

Brigham McNaughton is a managing director in PwC’s ESG practice. He has served global clients in a range of industries including utilities, automotive, and financial services, advising on core ESG strategy development and stakeholder engagement. Brigham has worked closely with the Sustainability Accounting Standards Board on a variety of reporting initiatives.

Heather Horn is PwC’s National Office thought leader, responsible for developing our communications strategy and conveying firm positions on accounting and financial reporting matters. She is the engaging host of PwC’s accounting and reporting weekly podcast and quarterly webcast series. With over 30 years of experience, Heather’s accounting and auditing expertise includes financial instruments and rate-regulated accounting.

Transcripts available upon request for individuals who may need a disability-related accommodation. Please send requests to [email protected].

In our Toolkit podcast series, we take a deep dive into one accounting topic each month that goes beyond the basics and into areas that require judgment. This month, we are covering leasing–a multifaceted area that generates numerous questions. 

In this episode, Heather Horn was joined by C.J. Finn, a partner in PwC’s private company services group and Chad Soares and Marc Jerusalem from our National Office to discuss lessons learned and key judgments that need to be made for private company adoption.

In this episode, you will hear:

• 1:12 - An overview of an effective adoption approach
• 6:03 - What previous adopters have learned about allocating the appropriate resources 
• 11:19 - The definition of a lease under ASC 842 and recognition of lease and non-lease components
• 20:24 - Transition and practical expedients 
• 29:18 - FASB standard setting activity to ease the burden of implementation
• 35:55 - Common legacy accounting issues that are challenging under the new standard
• 40:40 - Final advice on how to drive an effective implementation of ASC 842

Want to learn more? Listen to our previous podcast in our Leasing toolkit on how to get lease measurements and modifications right. Also, see our flowchart to think through lease classification in our Leases guide.

C.J. Finn, PwC’s private company accounting change leader, has 18 years of experience working with public and private companies. He has advised large multinational clients on complex accounting areas, SEC reporting, system development, mergers and acquisitions, and purchase accounting and valuation.

Chad Soares is a partner in PwC's National Office focused on leasing and financing arrangements. He was a primary author of PwC’s Leases guide and continues to contribute to a variety of thought leadership related to leasing and financial instruments.

Marc Jerusalem is a Director in PwC’s National Office specializing in leasing. Marc consults with clients on complex lease accounting issues and is a frequent contributor to many related PwC National Office publications.

Heather Horn is PwC’s National Office thought leader, responsible for developing our communications strategy and conveying firm positions on accounting and financial reporting matters. She is the engaging host of PwC’s accounting and reporting weekly podcast and quarterly webcast series. With over 30 years of experience, Heather’s accounting and auditing expertise includes financial instruments and rate-regulated accounting.

Transcripts available upon request for individuals who may need a disability-related accommodation. Please send requests to [email protected]. 

Did you enjoy this episode? Text us your thoughts and be sure to include the episode name.

Did you enjoy this episode? Text us your thoughts and be sure to include the episode name.

On March 21, the SEC published a widely anticipated proposal to enhance companies' climate-related disclosures. In addition to details regarding how management identifies, assesses and manages climate-related risks and the related impact on financial metrics, the proposal calls for companies to provide information about how their boards provide oversight of climate-related matters.

In this episode, Heather Horn was joined by PwC’s Stephen Parker and Jamie Gamble, along with John White, a partner in the law firm Cravath, Swaine & Moore and former Director of the Division of Corporation Finance at the SEC, to focus on the governance aspects of the SEC's climate disclosure proposal.

In this episode, you will hear:

2:46 - Potential timelines for final rule adoption and effective dates
7:16 - The intent of the governance requirements in the climate disclosure proposal
15:24 - If the governance provisions represent a trend for future SEC proposals
25:45 - Reactions in the marketplace and how companies are navigating the “learning curve” around climate and governance
28:29 - Perspectives on where responsibility for climate governance and oversight should reside
41:42 - How board oversight of a well-defined ESG strategy allows companies to manage risks and drive success
47:32 - Final advice on where boards and companies should focus as they continue to prepare for a final rule

Want to learn more? Listen to our previous podcasts that provide an overview of the proposal, related investor perspectives, and legal and regulatory perspectives on the proposal. 

Stephen Parker is a partner in PwC’s Governance Insights Center, which strives to strengthen the connection between directors, executive teams, and investors by helping them navigate the evolving governance landscape. With more than 30 years of experience, Stephen has advised boards of directors on a variety of complex financial reporting matters. Stephen’s client service experience has included energy and utility companies, financial services companies, and nonprofits.

Jamie Gamble is a managing director in PwC's Trust Solutions practice with over 25 years of experience focused on corporate governance, cybersecurity, workforce, and ESG-related issues. Before joining PwC, he was a litigation partner at Simpson Thacher & Bartlett LLP.

John White is a partner at Cravath, Swaine & Moore LLP, and chair of that firm’s Corporate Governance and Board Advisory practice. He represents public companies on a variety of disclosure matters, including corporate governance, reporting, financings, and restatements. With over 50 years of experience, he previously served as the Director of the Division of Corporation Finance at the SEC and on the board of Financial Executives International. John is a current member of FASAC, and member of the Board of Trustees of the Practicing Law Institute where he also serves as chair of the audit committee.

Transcripts available upon request for individuals who may need a disability-related accommodation. Please send requests to [email protected]

In our Toolkit podcast series, we take a deep dive into one accounting topic each month that goes beyond the basics and into areas that require judgment. This month, we are covering leasing–a multifaceted area that generates numerous questions.

In this episode, Heather Horn was joined by Suzanne Stephani and Marc Jerusalem, Directors from PwC’s National Office, to discuss the accounting guidance for some of the primary measurement and lease modification judgments that need to be made.

In this episode, you will hear:

• 2:20 - Common questions related to lease measurement
• 7:38 - Considerations around variable payments 
• 10:08 - Key concepts and tools when accounting for lease incentives 
• 16:38 - Determining the lease term when there are automatic renewals
• 21:59 - The importance of periodic reassessment of the lease term for lessees
• 31:10 - How to select the correct discount rate
• 37:09 - Lease modifications: what they are and how to account for them

Want to learn more? Listen to our previous podcast, Full disclosure: Leases, and read our chapter on modification and remeasurement of a lease in our Leases guide.

Suzanne Stephani is a Director in PwC’s National Office specializing in the application and interpretation of the accounting guidance related to financing and leasing transactions as well as the cash flow statement.

Marc Jerusalem is a Director in PwC’s National Office specializing in leasing. Marc consults with clients on complex lease accounting issues and is a contributor to many related PwC National Office publications.

Heather Horn is PwC’s National Office thought leader, responsible for developing our communications strategy and conveying firm positions on accounting and financial reporting matters. She is the engaging host of PwC’s accounting and reporting weekly podcast and quarterly webcast series. With over 30 years of experience, Heather’s accounting and auditing expertise includes financial instruments and rate-regulated accounting.

Transcripts available upon request for individuals who may need a disability-related accommodation. Please send requests to [email protected].

Did you enjoy this episode? Text us your thoughts and be sure to include the episode name.

In this episode, Heather Horn was joined by Rich Goode from PwC's ESG practice and Jillian Pearce from PwC's National Office to focus on the accounting and reporting for carbon offsets and renewable energy credits (RECs), including how they’re addressed in the SEC’s climate disclosure proposal.

In this episode, you will hear:

• 1:49 - An overview of RECs and carbon offsets
• 7:37 - What is renewable energy?
• 8:49 - Rich’s RSIO framework - reduce, switch, innovate, offset 
• 11:56 - A refresher on scope 1, 2, and 3 greenhouse gasses in the GHG Protocol and how RECs and carbon offsets can be used to offset them
• 14:49 - RECs and carbon offsets in the SEC climate disclosure proposal
• 23:12 - Accounting for RECs and carbon offsets
• 34:27 - Why companies using only RECs and carbon offsets may be missing out
• 36:58 - Final advice for companies on use of offsets and RECs

Want to learn more? Read our publication Accounting for your company’s zero-carbon future. And listen to our previous podcasts where we deep dive into GHG scope 1, scope 2, and scope 3. 

Rich Goode is a principal in PwC's ESG practice where he assists clients in the technology, media, and telecommunications sectors navigate key environmental, social, and governance issues. Leveraging 30 years of experience, Rich also currently serves as an Adjunct Lecturer at Harvard University.

Jillian Pearce is a Partner in PwC's National Office, providing advice on financial instruments and other technical accounting issues to power and utilities clients. She was a Professional Accounting Fellow in the Office of the Chief Accountant at the SEC, and has over 15 years of auditing experience.

Heather Horn is PwC’s National Office thought leader, responsible for developing our communications strategy and conveying firm positions on accounting and financial reporting matters. She is the engaging host of PwC’s accounting and reporting weekly podcast and quarterly webcast series. With over 30 years of experience, Heather’s accounting and auditing expertise includes financial instruments and rate-regulated accounting.

Transcripts available upon request for individuals who may need a disability-related accommodation. Please send requests to [email protected].

Did you enjoy this episode? Text us your thoughts and be sure to include the episode name.

In our Toolkit podcast series, we are taking a deep dive into one accounting topic each month that goes beyond the basics and into areas that require judgment. This month, we are covering income taxes–an area that generates numerous technical questions.

In this episode, Heather Horn was joined by Jenn Spang and Matt McCann, partners in PwC’s National Office, to discuss valuation allowances, an often challenging topic that contains multiple decision points and requires ongoing evaluation.

In this episode, you will hear:

• 2:02 - The definition of a valuation allowance
• 4:28 - An overview of the applicable accounting guidance
• 7:08 - Tips on when a timely scheduling analysis may be helpful
• 10:38 - Negative evidence represented by cumulative losses in recent years
• 16:05 - The relative weight of projections of future income 
• 24:23 - How tax planning strategies factor into available evidence
• 31:24 - Common misconceptions in performing valuation allowance assessments
• 36:16 - Navigating reversals of valuation allowances: timing, documentation, and disclosures
• 42:04 - Takeaways on improving the process of performing valuation allowance assessments

Want to learn more? Listen to the previous podcasts in our Tax toolkit in which we discuss how to consider uncertain tax positions, separate company financial statements, divestitures, and the scope of ASC 740. Also, refer to the chapter on valuation allowances in our Income taxes guide.

Jenn Spang is a partner in PwC’s National Office and serves as the income tax accounting leader, specializing in tax accounting under US GAAP and IFRS. She has over 25 years of experience helping companies in a variety of industries navigate complex tax accounting matters.

Matt McCann is a partner in PwC's National Office who provides consultation in the areas of revenue recognition and income taxes. He has over 25 years of experience and previously served as the leader of the Consumer & Industrial Products Sector Assurance Practice in North Texas.

Heather Horn is PwC’s National Office thought leader, responsible for developing our communications strategy and conveying firm positions on accounting and financial reporting matters. She is the engaging host of PwC’s accounting and reporting weekly podcast and quarterly webcast series. With over 30 years of experience, Heather’s accounting and auditing expertise includes financial instruments and rate-regulated accounting.

Transcripts available upon request for individuals who may need a disability-related accommodation. Please send requests to [email protected]. 

Did you enjoy this episode? Text us your thoughts and be sure to include the episode name.

Did you enjoy this episode? Text us your thoughts and be sure to include the episode name.

In recent months, regulators and standard setters around the globe have published proposed rules addressing companies' climate-related and other ESG disclosures. These proposals have investors in mind and could impact future reporting for many companies.

In this episode, Heather Horn was joined by PwC’s Hilary Eastman, Director of Investor Engagement, and Matt DiGiuseppe, a Managing Director in PwC's Governance Insights Center, to focus on the “big three” recent disclosure proposals from the SEC, the ISSB and EFRAG.

In this episode, you will hear:

• 1:05 - Perspectives from the investor community regarding climate-related proposals
• 9:11 - Why investors are demanding climate-related disclosures
• 17:21 - The challenges that preparers might face due to timelines established by regulators within current proposals
• 26:56 - The current state of sustainable investment analysis, and how analysts may cope with a future state of relative “information overload”
• 31:54 - The importance of preparation for producing quality disclosures
• 35:55 - How disclosures that would be made available under the new rules could impact investment analyses
• 39:25 - Recent global and domestic ESG disclosure developments, including shareholder resolutions
• 42:58 - The importance to investors of alignment across different sustainability reporting standards
• 47:59 - Final advice for companies on how considering investor perspectives may influence disclosure

Want to learn more? Listen to our previous podcasts covering GHG Scope 1, Scope 2, and Scope 3 emissions. Also, read PwC’s US investor survey: The economic realities of ESG. For more on the SEC’s proposal, refer to the text or audio version of our In the loop, The SEC wants me to disclose what? 

Hilary Eastman leads global investor engagement at PwC and is an ESG reporting strategy expert, with responsibility for managing the firm’s relationships with the investment community in the UK and globally. In her role, Hilary works with investors and analysts to get their views on a variety of corporate reporting and governance matters to help companies improve their reporting to the capital markets.

Matt DiGiuseppe is a Managing Director in PwC’s Governance Insights Center, which helps stakeholders navigate the evolving governance landscape. With over 15 years of experience, Matt has participated in numerous industry groups and was the founding chairperson of the Investor Stewardship Group (ISG), which advanced a set of corporate governance and stewardship principles for the US market.

Heather Horn is PwC’s National Office thought leader, responsible for developing our communications strategy and conveying firm positions on accounting and financial reporting matters. She is the engaging host of PwC’s accounting and reporting weekly podcast and quarterly webcast.

Transcripts available upon request for individuals

In our Toolkit podcast series, we are taking a deep dive into one accounting topic each month that goes beyond the basics and into areas that require judgment. This month, we are covering income taxes–an area that generates numerous technical questions.

In this episode, Heather Horn was joined by Jenn Spang and Matt McCann, partners in PwC’s National Office, to discuss the specific fact patterns that often cause preparers to question which guidance to apply to their tax transaction.

In this episode, you will hear:

• 1:17 - An overview of the GAAP guidance and what counts as an “income tax”
• 5:03 - Specific considerations for partnerships and pass-through entities
• 9:38 - Withholding taxes from the perspectives of the entities paying and receiving a dividend
• 13:12 - Accounting for tax credits and other tax incentives
• 18:22 - Key facts that determine whether digital service taxes are in the scope of ASC 740
• 20:43 - Takeaways on how to effectively navigate the global tax landscape and establish appropriate monitoring

Want to learn more? Listen to the previous podcasts in our Tax toolkit in which we discuss how to work with uncertain tax positions, separate company financial statements, and divestitures. Also, refer to our chapter on Scope of ASC 740 in our Income taxes guide.

Jenn Spang is a partner in PwC’s National Office and serves as the income tax accounting leader, specializing in tax accounting under US GAAP and IFRS. She has over 25 years of experience helping companies in a variety of industries navigate complex tax accounting matters.

Matt McCann is a partner in PwC's National Office who provides consultation in the areas of revenue recognition and income taxes. He has over 25 years of experience and previously served as the leader of the Consumer & Industrial Products Sector Assurance Practice in North Texas.

Heather Horn is PwC’s National Office thought leader, responsible for developing our communications strategy and conveying firm positions on accounting and financial reporting matters. She is the engaging host of PwC’s accounting and reporting weekly podcast and quarterly webcast series. With over 30 years of experience, Heather’s accounting and auditing expertise includes financial instruments and rate-regulated accounting.

Transcripts available upon request for individuals who may need a disability-related accommodation. Please send requests to [email protected]. 

Did you enjoy this episode? Text us your thoughts and be sure to include the episode name.