/'0 Fourth Edition Skills for Accounting Research FASB Codification and eIFRS Text and Cases Shelby Collins, CPA Accounting Research Solution s With Tax Research Chapter By Martha L. Salzman University at Buffalo /'0 - ��� /'0 �� Foreword For 16 years, I taught the graduate accounting policy and research class at the University of Georgia's J.M. Tull School of Accounting. And then , I worked closely with my successor to help him develop materials to teach the course. These experiences have taught me firsthand what a challenging, albeit rewarding, topic accounting research is for students, and what a challenging course it can be to develop. Prior to this position, my 26 years with Ernst & Young and 10 years as Chairman of the Financial Accounting Standards Board (FASB) have shown me that despite this challenge, research and communication skills are what set graduates apart in practice. My class required students to prepare reports on real-world case studies and to participate actively in class discussions of research and current events. However, these research and com- munication skills did not always come naturally to students. I'll never forget the time when, after assigning students a case involving revenue recognition at CBS Sports , a student approached me and said that he could not find "NFL Football" anywhere in the accounting Literature. I hinted to him that terms such as "revenue recognition" or "licensing fees" were more likely to result in relevant information for this particular case. Frequently, even identifying the right keywords to search can involve practice and finesse. While the introduction of the FASB Codification has done a lot to facilitate guidance search- es, accounting research remains a daunting challenge for many students. In part that's simply because of the sheer volume of guidance included within U.S. GAAP, and in part it is because accounting policy issues often don't have black or white answers. It's therefore imperative that students are well trained in the resources that can help them make informed judgments. These include not only the authoritative literature, but also guid- ance for similar issues that may be relevant "by analogy" and nonauthoritative sources, such as examples from practice and interpretive guidance. Shelby Collins is one of my former students, and a standout whom I had the privilege of nominating for a position at the FASB. When she approached me with the idea for this book, I was immediately supportive. After all, throughout my 16 years of teaching, I was unable to find a resource that met the challenge of teaching accounting students the skills necessary to perform great research, let alone prepare instructors for the challenge of teaching this course. This book does just that. Shelby and I worked closely on the initial draft of this book, and this edition builds upon that strong foundation to incorporate even more feedback from the ...

1. /'0
Fourth Edition
Skills for Accounting
Research
FASB Codification and eIFRS
Text and Cases
Shelby Collins, CPA
Accounting Research
Solution
s
With Tax Research Chapter By
Martha L. Salzman
University at Buffalo

2. /'0
- ���
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Foreword
For 16 years, I taught the graduate accounting policy and
research class at the University of
Georgia's J.M. Tull School of Accounting. And then , I worked
closely with my successor to help
him develop materials to teach the course. These experiences
have taught me firsthand what a
challenging, albeit rewarding, topic accounting research is for
students, and what a challenging
course it can be to develop. Prior to this position, my 26 years
with Ernst & Young and 10 years
as Chairman of the Financial Accounting Standards Board
(FASB) have shown me that despite
this challenge, research and communication skills are what set

3. graduates apart in practice.
My class required students to prepare reports on real -world case
studies and to participate
actively in class discussions of research and current events.
However, these research and com-
munication skills did not always come naturally to students. I'll
never forget the time when, after
assigning students a case involving revenue recognition at CBS
Sports , a student approached me
and said that he could not find "NFL Football" anywhere in the
accounting Literature. I hinted
to him that terms such as "revenue recognition" or "licensing
fees" were more likely to result in
relevant information for this particular case. Frequently, even
identifying the right keywords to
search can involve practice and finesse.
While the introduction of the FASB Codification has done a lot
to facilitate guidance search-
es, accounting research remains a daunting challenge for many
students. In part that's simply
because of the sheer volume of guidance included within U.S.
GAAP, and in part it is because
accounting policy issues often don't have black or white

4. answers.
It's therefore imperative that students are well trained in the
resources that can help them
make informed judgments. These include not only the
authoritative literature, but also guid-
ance for similar issues that may be relevant "by analogy" and
nonauthoritative sources, such as
examples from practice and interpretive guidance.
Shelby Collins is one of my former students, and a standout
whom I had the privilege of
nominating for a position at the FASB. When she approached
me with the idea for this book, I
was immediately supportive. After all, throughout my 16 years
of teaching, I was unable to find
a resource that met the challenge of teaching accounting
students the skills necessary to perform
great research, let alone prepare instructors for the challenge of
teaching this course.
This book does just that. Shelby and I worked closely on the
initial draft of this book, and
this edition builds upon that strong foundation to incorporate
even more feedback from the

5. community of accounting research instructors. I am pleased to
say that the result is a useful, and
necessary resource that will enhance the quality of accounting
research education-for students,
instructors, and professional users alike.
With the help of this book, we can make this challenging, yet
important, skill more attain-
able for students.
Dennis R. Beresford
Executive in Residence, University of Georgia
Former Chairman of the Financial Accounting Standards Board
iii
0
iv
About the Authors

6. Shelby Collins, CPA, loves accounting research. Her current
consulting position, assisting
companies with implementation of the new GAAP and IFRS
lease and revenue accounting stan-
dards, brings a fresh and relevant perspective to this text. Prior
to this position, Shelby taught
the accounting research course at the University at Buffalo for
six years. Her career has been
dedicated entirely to this field: first at the Financial Accounting
Standards Board (FASB) as a
postgraduate technical assistant, then in KPMG's Accounting
Advisory Services group, and then
in the accounting policy and research group at Exelon
Corporation in Chicago.
Shelby has seen firsthand the doors that can open for
professionals who excel in research
and communication. She is eager to bring practical, real -world
insights to students in a way that
promotes hands-on, active learning. It's her hope that this book,
and the exercises herein, will
prepare students to shine when they encounter accounting
research opportunities as professionals.
Martha L. Salzman authored the tax research chapter of this

7. book. Martha is a clinical assistant
professor at the University at Buffalo School of Management,
where she teaches the Masters-
level professional tax research course and business law courses.
Martha is a graduate of the
University of Rochester (B.A., Political Science) and the
University of Pennsylvania Law
School (J.D.), and is licensed to practice law in the State of
New York. Martha spent 18 years at
the law firm of Phillips Lytle LLP, where her practice focused
primarily on taxation, including
advising clients regarding tax planning, compliance, audits and
disputes. Martha enjoys using
her real-world tax experience to better prepare students for their
futures as tax and accounting
professionals.
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Preface

8. Increasingly, accounting research and communication skills are
being regarded as fundamental
to success in our profession. Professionals who excel in these
areas will likely experience a dis-
tinct competitive advantage relative to their peers. At the same
time, in today's highly regulated
business climate, the consequences of inadequately researching
and documenting accounting
judgments can be severe (e.g., PCAOB or SEC enforcement
actions). Recognizing the impor-
tance of research skills, research simulations are now a key
component of the national CPA
exam. This hands-on textbook aims to teach students these
important skills.
In this book, students will learn to confidently address and
communicate accounting
research issues, from start to finish. Students will not only take
away the ability to identify
the accounting problem (the "researchable question"), but will
gain experience locating and
applying guidance within key research tools (including the
FASB Codification and eIFRS), in
a variety of accounting environments. In learning to use these
research tools, students will have

9. the opportunity to apply guidance to a variety of actual
accounting topics.
Recognizing that students cannot learn to research simply by
reading about research, the
textbook offers students numerous opportunities to actively
apply chapter lessons, throughout
each chapter. Students will come away from this book armed
with the research and critical think-
ing skills necessary for success as accounting professionals.
TARGET AUDIENCE
This book is intended to serve as the primary teaching materials
for graduate and undergraduate
courses in accounting research. The book may also be used to
supplement materials used in an
intermediate or advanced accounting course, given the many
opportunities provided within the
text to apply Codification guidance to related accounting topics
(including, for example, leases,
revenue recognition, and fair value measurements).
Practitioners and staff training programs can
also benefit from the research and communication strategies
covered in this book, while gaining
exposure to actual excerpts and topics covered in the

10. Codification and other research databases.
Colleges and universities are increasingly including accounting
research as a curriculum
requirement for undergraduate and/or graduate-level accounting
students. Often, students reach-
ing this stage of their accounting program will have just
completed their first accounting intern-
ship. Interns, as with new staff accountants, will quickly
discover that they are expected to learn
on the job (accounting can be a sink-or-swim environment).
These students will likely have had
just enough exposure to the challenges of research that they will
crave more formal instruction
on this critical skill. This book will offer that to students, in a
format that is understandable and
engaging.
v
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vi Preface

11. Prerequisites for Users of this Book
To get the most value from this textbook, students studying this
material should have already
taken introductory-level accounting courses and-to the extent
that the chapters on tax and
auditing research will be covered-introductory tax and
introductory auditing courses.
Users of this book will need access to the FASB Codification
research tool. The American
Accounting Association (AAA) provides academic access to the
FASB Accounting Standards
Codification and the Governmental Accounting Standards
Board's GARS Online database for a
low annual fee of $250 per year, per institution.
Instructors may also choose to require students to obtain a $30
annual subscription to eIFRS
through the IAAER; alternatively, students can register on
www.ifrs.org to obtain free access to
individual standards.
To complete the exercises and case studies within the tax
chapter of this book, it is suggested
that users have access to an online tax research service, such as

12. Thomson Reuters Checkpoint or
CCH IntelliConnect. Access to these services is often available
at reduced rates (or free-of-charge)
for students enrolled in a tax or tax research course. Information
on Thomson Reuters Checkpoint
is available at: https://tax.thomsonreuters.corn/en/checkpoint.
Information on CCH IntelliConnect
is available at
https://taxna.wolterskluwer.corn/research/intelliconnect.
OUTSTANDING FEATURES OF THIS BOOK
This book unites research techniques with actual technical
accounting issues. Students will move
their understanding of accounting issues and research
techniques forward along the knowledge
continuum, from simply understanding to having the ability to
critically think about and apply
accounting issues. The practical examples and exercises in this
book will challenge students to
actively learn while they read.
Instructors will value that this book allows students to
independently read and practice the
baseline skills necessary to become accounting researchers,
leaving instructors free to expand

13. lectures into discussions of accounting judgments, student
presentations, current events, and
classroom discussions of ( or hands-on group practice with)
case studies. In short, instructors will
be able to actively engage students in classroom debates and
discussions, because they can spend
less of their valuable classroom time lecturing on basic research
and communication skills.
Overview of the Book
Chapters 1-5 of this book provide baseline knowledge that is
necessary for understanding the
rest of the book; the remaining chapters are written
independently of one other, allowing instruc-
tors to choose to utilize only those chapters that fit their
individual course needs.
Chapter 1 offers an overview of accounting research, including
discussion of who performs
accounting research and in what circumstances, and introducing
key standard setters.
Chapter 2 provides an in-depth introduction to the FASB
Codification, and emphasizes that
students should perform Browse (as opposed to keyword

14. searches) when possible.
Chapter 3 introduces the research process, and Chapter 4
introduces the fundamentals of
effective technical writing, including the format of an
accounting issues memorandum, tech-
niques for effective email communication of research, and
appropriate style for technical
accounting writing.
Chapter 5 teaches students how to properly use nonauthoritati ve
resources (e.g., Concepts
Statements, firm resources, benchmarking), an essential but
often overlooked skill for pro-
fessionals learning to perform research.
Chapters 6--8 give students the opportunity to apply guidance to
accounting issues following
the order of sections in the Codification: first, issues involving
scope and recognition (Ch. 6),
followed by accounting measurement (Ch . 7), and specifically
fair value measurement (Ch. 8).

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Chapters 9-12 introdu ce skills specific to performing research
in other environments,
including auditing and professional services research (C h. 9),
gove rnm ental resea rch (C h. 10),
tax research (Ch. 11 ), and intern ati onal research (Ch . 12).
Each of these chapters stands on its
own, so in structors can choose to cover only the chapters
relevant to their own courses.
Finally, Chapters 13 and 14 foc us on softer ski lls. Chapter 13
teaches stu de nts how to
prepare and deli ver effecti ve presentations. Chapter 14 emphas
izes the need fo r profess ionals to
stay current as accounting requirements change and introduces
the standard setters' due process
for issuing new guidance. This chapter is a mu st-read and
encourages students to sign up fo r
accounting news alerts.
Engaging Pedagogy
Research is a skill that you learn by doing; accordingly, the

16. pedagogy in thi s book is designed
to fos ter active learning.
Chapter Opening Vignettes, Learning Objectives, and
"Organization of This
Chapter" Diagrams
Each chapter opens with a brief vignette placin g students in the
shoes of a beginning researcher.
This opening vignette is fo llowed by a li st of the learnin g obj
ectives for the chapter, and then by
a diagram illustratin g the organ ization of co nte nt within the
chapter. These chapter-openi ng ele-
ments are intended to generate reader enthu sias m for chapter
co ntent, as well as prov ide stude nts
with an overview of the infor mation to co me.
Example Chapter Opening Vignette (from Chapter 6, Scope)
Printout in hand , Julie taps on her boss's door. She is feeling
pretty good ; she just
found a paragraph in the guidance that appears to speak directly
to the tax accrual
issue her boss asked her to research. As she shows him the

17. guidance , he taps his
pen thoughtfully on the desk.
"Are you sure this guidance applies to our type of transaction?"
he asks .
He continues , "I think the guidance for gross receipts taxes
(which are based
on revenue measures) may differ from guidance for taxes based
on income. You 've
brought me guidance specific to income taxes."
Julie shakes her head ; she realizes that she forgot to review the
scope section
of the guidance that she had printed. "Let me double check the
scope section for this
guidance ," she says. "I'll stop by again later to let you know
what I've found. "
Confirming that a transaction is within the scope of a

18. Codification topic may seem
like an extra step, but much of the guidance within the
Codification includes specific
instructions for its use. Don't get caught like Julie, forgetting to
do the appropriate dili-
gence work on guidance that may otherwise appear to be on
point. A proper review of
the scope section is critical to identifying appropriate
recognition , and then measure-
ment, guidance for a transaction .
Preface vii
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viii Preface

19. Example Learning Objectives (from Chapter 2, regarding the
FASS Codification)
After reading this chapter and performing the exercises herein,
you will be able to
1. Describe the purpose of the Codification , and the meaning of
authoritative.
2. Identify standard setters that have contributed to the current
body of authoritative
guidance.
3. Understand the organization of guidance within the
Codification.
4. Perform effective Browse searches within the Codification ,
reviewing all areas of
required reading.
5. Search the Codification using other methods, including
keyword searches, the Master

20. Glossary, and the Cross Reference feature.
6. Differentiate between existing versus pending content, and
understand how to inter-
pret transition date guidance.
7. Recognize accounting alternative guidance available for
private companies.
Example "Organization of This Chapter" Diagram (from Chapter
3, regarding the
research process)
Eac h chapter includes a graphic showing the organization of
topics within the chapter, along
with narrati ve discussion of what the reader can expect key
chapter themes to include. Following
is one such chapter organization graphic:
Steps in the Research Process
0. Understand the business (i ndustry). Judgment and
1. Understand the transaction. Decision Making

21. 2. Define the research problem . in the Research Next Chapter:
3. Think independently about possible -..... Process -.....
Documenting
sol utions. ~ 1. Common biases - accounting
4. Search potentially relevant sou rces of 2. Ove rcoming
research
guidance . biases to reach
5. Analyze the alternative treatments. sound decisions
6. Justify and document yo ur conclusion.
Chapter Features
Chapters are written in concise, easy to understand language,
with boldfaced key terms to call
students' attention to certain topics. In addition, chapters
include extensive screenshots (from
research tools, particularly the Codification) and diagrams illu
stra ting key chapter concepts,
intended to both engage students and improve their fa miliarity
with research tools.
Chapters also include the fo llowing fea tu res , intended to

22. engage students in active learning :
Now You Try
Throughout each chapter, students are challenged to practice
and apply key skills as they are
taught (Now YOU Try questions) . These exercises might
involve , fo r example, a student being
asked to "draw a picture" of a transaction, "draft an email"
describing an issue, "show the search
path you would use," or "identify the journal entries" for a
scenario, using guidance fro m the
Codification as a guide for the appropriate accounting.
Instructors can use these questions as a
lead-in to acti ve in-class discussions.
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x Preface

23. Example Case Study Question (from Chapter 4, regarding
effective
communication)
Writing a Short Iss ues Memo-In ventory Va luati on You have
been asked to draft a brief issues memo ("to the files")
analyzing the following issue.
Charles Corp. has leased a mine from which it recently
extracted 2,000 kilograms of bauxite (a min-
eral used in producing aluminum). Charles Corp. plans to sell
the bauxite to aluminum manufacturers.
Charles Corp. is analyzing whether its bauxite inventory can be
carried at its selling price per ASC 330-
I0-35- I 6(b) . Assume that quoted market prices are generally
available for bauxite, and that the market
for bauxite is active.
Using the standard memo format, analyze whether all necessary
conditions are met for the accounting treatment
proposed. If assumptions are needed to fully evaluate the
guidance, identify those assumptions in your analysis. For this
particular memo, you are not required to present alternative
treatments; assume for this issue that you have solely been
asked to document whetherthe conditions in ASC 330-I0-35-

24. 16(b) are met.
NEW TO THIS EDITION
• MyBusinessCourse: New video examples have been added to
MBC.
• New Standards: Includes strategies for navigating the revised
revenue and lease topics and
new assignments requiring students to research and interpret the
new standards and to docu-
ment and communicate their findings.
• Codification: Presents updated screenshots of the Codification
featuring the latest standards.
• Updated Detailed Research Example: The author presents a
real research question involving
baseball stadium concession sales (Lease? Revenues?) and
integrates it throughout Chapters
3 and 4. Students will follow this real-world example through
the research, process culmi-
nating in a new chapter-end sample memo.
• Case Studies: The text includes new, current, and real -world

25. case studies of varying dif-
ficulty level-including cases building upon the stadium
example. Cases place increased
emphasis upon the use of professional judgment.
SUPPLEMENTS
All supplements for this book have been created by the book's
authors.
Instructors Manual-Includes resources for instructors of this
course, including sample
course schedules and grading considerations, teaching tips for
each chapter, and links to external
resources.
PowerPoint Slides-Available for each chapter, PowerPoint
lecture slides highlight key mat-
ter from each chapter.