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On March 21, the SEC published a widely anticipated proposed rule addressing companies’ climate-related disclosures.

Heather Horn was joined by Kyle Moffatt and Valerie Wieman, partners in PwC’s National Office, to discuss the main provisions of the proposal and a few of what could be challenging compliance requirements.

In this episode, you will hear:

• 1:20 - Elements of the proposal that surprised our guests
• 4:29 - The evolution of climate disclosure rules leading to the current proposal
•  6:52- Background on development of the proposal, and controversy among the commissioners regarding the rules
• 10:53 - Overview of the contents of the proposal
• 18:56 - Current expected timelines of adopting a final rule and transition timing
• 26:11 - Greenhouse gas disclosures requirements, and the types of emissions that are in scope
• 38:09 - Overview of the comment letter process and the path to finalization of the rule
• 48:21 - Final thoughts on where companies can start on unpacking the proposal and preparing for a final rule

Want to learn more? Read the proposed rules, Enhance and Standardize Climate-Related Disclosures for Investors, the related fact sheet, and our In brief, First look at the SEC's climate disclosure proposal. Also, refer to our recently updated In the loop which now includes SEC comments under the existing climate rules.

Kyle Moffatt is a partner in PwC's National Office where he consults with engagement teams and audit clients on SEC reporting matters. He joined PwC in 2020 after spending almost 20 years with the SEC, most recently as Chief Accountant and Disclosure Program Director in the Division of Corporation Finance.

Valerie Wieman is PwC’s National Office Editor-in-chief. She is involved in the creation, development, and publication of our brand-defining thought leadership, with a recent focus on ESG reporting. Prior to this role, she was part of PwC’s National Office SEC Services group, helping clients navigate SEC rules and regulations.

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].

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On March 9, the SEC published a proposed rule addressing disclosures related to a company’s cybersecurity risk management, strategy, governance, and incidents.

Heather Horn was joined by Kyle Moffatt, a partner in PwC’s National Office, to discuss the potential impacts of the proposal and what could change in companies’ current reporting for cybersecurity.

In this episode, you will hear:

• 1:20 - An overview of the current disclosure guidance and what would change under the proposed rule
•  5:42 - How the proposed rule would address insider trading, and a discussion on the landscape of cyber-related comment letters
• 8:54 - The impetus for the proposed rule, and how the current regulatory environment influenced its creation
• 12:48 - Key changes to incident reporting, and how the new rules try to create comparable disclosures across companies
• 19:22 - Cyber risk management and strategy: how the new rule is intended to impact behaviors
• 24:42 - Governance and oversight disclosures, including a new requirement to include directors’ and management’s cybersecurity expertise
• 28:58 - Potential challenges that companies may face in preparing the proposed new disclosures
• 32:54 - The importance of focusing on disclosure readiness, controls, policies, and procedures to comply with the new rules once enacted

Want to learn more? Read the proposed rule on Cybersecurity Risk Management, Strategy, Governance, and Incident Disclosure.

Kyle Moffatt is a partner in PwC's National Office where he consults with engagement teams and audit clients on SEC reporting matters. He joined PwC in 2020 after spending almost 20 years with the SEC, most recently as Chief Accountant and Disclosure Program Director in the Division of Corporation Finance.

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, as well as periodic webcasts for the power and utilities industry. 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].

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The world continues to focus on the recent events in Ukraine and the devastating impact they have had on the people in that region; their safety and well being continues to be the primary concern of all of us. The combination of the Russian government’s invasion of Ukraine and the resultant sanctions–designed to inflict severe consequences on the Russian economy–has impacts not only to companies with operations in the region, but to all companies that participate in the global economy. Our In depth, Implications of the Russian government’s invasion of Ukraine, highlights several accounting and reporting matters that companies may need to consider this quarter.

Global events have put even greater emphasis on transparency around cyber risk. Both Congress and the SEC took actions on this topic in March, with new legislation requiring reporting of cyber incidents by critical infrastructure owners and a proposed SEC rule that would expand cyber-related reporting and disclosure requirements for SEC registrants. The SEC also took a significant step on ESG reporting on March 21 by issuing its landmark proposal on climate disclosures. Meanwhile, outside of the US, new global ESG reporting standards and requirements continue to move forward at a rapid pace. In Ask the National Office, we explain why these international developments matter to US companies.

The start of a new year also means adopting new accounting standards. Notably, revised guidance on liabilities and equity is now effective for many public companies. Changes are also on the horizon for the FASB’s technical agenda, as the FASB weighs feedback it received from its invitation to comment last year.

In this edition of The quarter close, we highlight these and other relevant accounting and reporting topics you should consider as you close out the first 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 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 each of the five steps in the revenue recognition model.

In this episode, Heather Horn was joined by Angela Fergason and Mike Coleman, partners in PwC’s National Office, to discuss step four of revenue recognition: allocating the transaction price.

In this episode, you will find:

• 01:19 - The core objective of step four: allocating based on relative standalone selling price
• 04:03 - Common approaches to estimating standalone selling price
• 10:47 - How to apply the residual approach (for use in limited circumstances)
• 15:03 - Special considerations for the allocation of discounts and variable consideration
• 20:11 - The importance of consistency
• 26:11 - Key tips about making judgments in your process of estimation

Want to learn more? 

• Listen to our previous Revenue toolkit episodes in which we discuss how to identify the contract, identify performance obligations, and determine the transaction price.
• Read chapter 5, Allocating the transaction price, in our Revenue from contracts with customers guide. 

Angela Fergason is a partner in PwC's National Office with over 20 years of experience who specializes in accounting for revenue and employee compensation arrangements. She also consults on a range of financial reporting issues impacting technology companies. Angela is a frequent speaker on accounting and financial reporting topics and is a contributor to many PwC National Office publications, including our accounting guides on revenue and stock-based compensation.

Mike Coleman is a partner in PwC's National Office with over 30 years of experience. He specializes in accounting for revenue and software arrangements. Prior to his time in National, Mike was an audit partner in the firm's NY Metro assurance practice serving technology clients. In addition, he has been one of the firm's represented the firm on the AICPA Software Task Force. 

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, as well as periodic webcasts for the power and utilities industry. 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 Finance 2025 podcast series, we give listeners insight into the future of finance and the evolutionary road to get there. We’re asking: what will the modern finance organization look like in the year 2025?

This week, Heather Horn was joined by David Shebay, a partner in PwC’s Consulting Solutions practice, and Brigham McNaughton,  a managing director in PwC’s ESG practice, to discuss how leading organizations are evolving their finance functions to respond to the challenges of ESG reporting.

In this episode, you will hear:

• 3:23 - How to identify your current state of ESG reporting readiness, and the importance of an implementation strategy to keep you outcome-oriented
• 9:54 - How to look at reporting from the stakeholder’s perspective
• 13:24 - The role that investors have had in enhancing incremental disclosures, and how the SEC is responding to investor demands
• 17:52 - How ESG factors are influencing the overall mainstream credit process
• 23:37 - How the demand for ESG measures is impacting internal reporting, and the implications for the finance function
• 35:21 - Key changes needed from a process, controls, and technology perspective, and final advice

Want to learn more? Listen to some of our previous podcasts that cover the current finance transformation landscape, and hear an overview of upcoming ESG rules in Talking ESG: Demystifying the reporting landscape.

David Shebay is a partner in PwC’s Consulting Solutions practice, focused on serving clients in the US energy and chemicals sectors. David’s work includes CFO advisory, modern finance, and the intersection of ESG with finance and systems transformation. Prior to joining PwC, David served as CFO of a managed IT services company.

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 (SASB) 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, as well as periodic webcasts for the power and utilities industry. 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 each of the five steps in the revenue recognition model.

In this episode, Heather Horn was joined by Angela Fergason and Alexandra Pascu from PwC’s National Office, to discuss step three of revenue recognition: determining the transaction price.

In this episode, you will find:

• 3:18 - Determining whether the contract contains significant financing components
• 7:52 - How noncash and variable consideration impact the transaction price
• 12:32 - Methods for estimating variable consideration, and considering the measurement constraint
• 19:54 - The key judgments needed for service level agreements or similar arrangements
• 24:54 - Evaluating payments to customers as a form of variable consideration, and how they impact the transaction price
• 26:58 - Key takeaways: step three in a nutshell, and additional resources

Want to learn more? 

• Read the Determining the transaction price chapter in our Revenue guide.
• Listen to our previous podcasts on Variable consideration: How it impacts your top and bottom line and Payments to customers? Receipts from vendors? Help!.

Angela Fergason is a partner in PwC's National Office with over 20 years of experience who specializes in accounting for revenue and employee compensation arrangements. She also consults on a range of financial reporting issues impacting technology companies. Angela is a frequent speaker on accounting and financial reporting topics and is a contributor to many PwC National Office publications, including our accounting guides on revenue and stock-based compensation.

Alexandra Pascu is a director in PwC’s National Office with over 9 years of experience. She focuses on revenue recognition, software costs, stock-based compensation, and inventory. Prior to this role, Alexandra  led audits of companies ranging from small emerging growth companies to public multinationals.

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, as well as periodic webcasts for the power and utilities industry. 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.

PwC’s accounting podcast became a book club this week as Heather Horn was joined by Matt Mani and Paul Leinwand of PwC's Strategy&—co-authors of the book: Beyond Digital: How Great Leaders Transform Their Organizations and Shape the Future. Together they discuss seven imperatives of leadership that have enabled successful large-scale business transformations, and the lessons that today’s finance organizations can learn from these transformations.

In this episode, you will hear:

• 4:40 - The leadership imperatives that companies should focus on, including how they can begin to reimagine their place in the world and create value via ecosystems
• 16:06 - What it means to build a system of privileged insights with customers and how it helps to make your organization outcome-oriented
• 20:42 - Reinventing engagement and the social contract with your people to address emerging challenges, such as the great resignation
• 26:16 - Inverting the focus of organizational leadership to drive transformation in a dynamic and collaborative way
• 30:48 - Disrupting your own leadership to grow your skill sets and begin change from within
• 38:02 - Key lessons to jumpstart your overall transformation

Want to learn more? The Beyond Digital landing page has links to additional resources, reviews, and where to find the book.

Matt Mani is a partner for PwC’s Strategy& consulting practice. With over 29 years of experience, he focuses on helping companies achieve business model, cost, and performance transformations. He is the co-author of the book Beyond Digital: How Great Leaders Transform Their Organizations and Shape the Future, and multiple articles in Harvard Business Review and Strategy+business magazine.

Paul Leinwand is a thought leader on strategy, growth, and capability building for PwC’s Strategy& consulting practice. With over 24 years of experience, he has authored numerous books, as well as articles in the Harvard Business Review and Strategy+business magazine. He currently teaches at Kellogg School of Management as an Adjunct Professor of Strategy.

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, as well as periodic webcasts for the power and utilities industry. 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 each of the five steps in the revenue recognition model.

This week Heather Horn was joined by Angela Fergason and Mike Coleman, partners in PwC’s National Office, to discuss revenue step two: identifying the performance obligations. Angela and Mike share the key points to consider carefully, especially because this step dictates the units of account for the entire contract.

In this episode, you will hear:

• 4:57 - How to find all relevant promises to the customer, and how to treat implied promises
• 9:29 - The criteria utilized to assess whether a good or service is “distinct”
• 16:30 - How to account for promises to transfer a series of distinct goods or services
• 22:05 - How to treat a customer’s option to purchase additional goods or services 
• 27:20 - How selling a “solution” may comprise multiple performance obligations, and other key final reminders

Want to learn more? Read chapter 3, Identifying performance obligations, in our Revenue from contracts with customers guide.

Angela Fergason is a partner in PwC's National Office with over 20 years of experience who specializes in accounting for revenue and employee compensation arrangements. She also consults on a range of financial reporting issues impacting technology companies. Angela is a frequent speaker on accounting and financial reporting topics and is a contributor to many PwC National Office publications, including our accounting guides on revenue and stock-based compensation.

Mike Coleman is a partner in PwC's National Office with over 30 years of experience. Mike specializes in accounting for revenue and software arrangements and has served technology clients for much of his career. In addition, Mike has represented the firm on the AICPA Software Task Force. 

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, as well as periodic webcasts for the power and utilities industry. 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 Finance 2025 podcast series, we give listeners insight into the future of finance and the evolutionary road to get there. We’re asking: what will the modern finance organization look like in the year 2025?

This week, Heather Horn was joined by Kaiser Kaiserani, director in PwC’s finance transformation practice, to discuss how machine learning is becoming an integrative solution for some of the major challenges facing today's finance organizations.

In this episode, you will hear about:

• 4:06 - Artificial intelligence, machine learning, and what these concepts mean
• 12:11 - Differentiating supervised and unsupervised machine learning, and the practical applications of each
• 21:13 - The definition of an “insight equation” and how to effectively select specific data applications for meaningful process improvements
• 23:34 - How machine learning can reduce bias in the process of analyzing multiple data inputs
• 28:11 - How to leverage machine learning for real time “heavy lifting” of supply, demand, and other core business data
• 38:29 - Steps to enable machine learning and accelerate your process transformation
• 42:18 - At a glance: machine learning as a key component of the finance organization of the future

Want to learn more? Listen to some of the previous podcasts in the Finance 2025 series where we discuss other key elements of transformation, such as how to realize the promise of automation, trends in ERP transformation, and how to leverage FP&A to drive business agility.

Kaiser Kaiserani is a Director in PwC’s Finance Transformation practice with over 15 years of experience at the intersection of Finance and Technology. With prior experience in industry in various roles such as accounting, FP&A and shared services, combined with over 10 years of Consulting experience, he brings both strategic and executional approach to his client engagements. Over the past 5 years, he has been focused on the digital strategy and transformation of the Finance function and most recently has been devoted to evangelizing Machine Learning to our Finance leaders at global companies.

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, as well as periodic webcasts for the power and utilities industry. 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 each of the five steps in the revenue recognition model.

In this episode, Heather Horn was joined by Angela Fergason and Pat Durbin, partners in PwC’s National Office, to discuss step one of revenue recognition: identifying the contract. While it may appear straightforward, there are some judgments to be made and getting it right is critical for the rest of the revenue recognition process.

In this episode, you will find:

• 03:10 - Determining the applicability of accounting guidance for each arrangement
• 12:19 - The five criteria that determine whether a contract exists for accounting purposes
• 15:28 - Collectibility considerations
• 22:10 - What to do if the criteria for contract existence are met after the initial assessment
• 24:38 - How enforceable rights and obligations, rather than a stated term, dictate the contract term
• 29:49 - Key takeaway: the importance of not taking shortcuts through the step one assessment

Want to learn more? Read Chapter 2 of our Revenue guide on scope and identifying the contract.

Angela Fergason is a partner in PwC's National Office with over 20 years of experience who specializes in accounting for revenue and employee compensation arrangements. She also consults on a range of financial reporting issues impacting technology companies. Angela is a frequent speaker on accounting and financial reporting topics and is a contributor to many PwC National Office publications, including our accounting guides on revenue and stock-based compensation.

Pat Durbin is a partner in PwC’s National Office and has over 30 years of experience. He has expertise in financial reporting and extensive experience serving board, C-suite, and senior management level executives across a variety of industries and geographies both in the US and internationally.

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, as well as periodic webcasts for the power and utilities industry. 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.