SAB 108 Adoption Briefing - Audit Analytics Trend Reports

SAB 108 Adoption Briefing

SAB 108 Adoption Briefing - Audit Analytics Trend Reports
SAB 108 Adoption Briefing
Published Jan 01, 2008
12 pages — Published Jan 01, 2008
Price US$ 195.00  |  Buy this Report Now

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In September 2006, the SEC issued Staff Accounting Bulletin N. 108, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements. The major objective of SAB 108 was to eliminate inconsistencies in the treatment of historical accounting errors. Contained within SAB 108 was one controversial requirement: that any previously uncorrected errors could be entered, on a one-time basis only in the year of adoption, directly into beginning retained earnings. In short, these errors could be corrected without ever appearing on an income statement. This feature of SAB 108 brings with it issues associated with historical comparability of financial results. Registrant adoptions of SAB 108, through the first eight months of application, totaled 2,961, representing 4.71% of all registrants and $630 billion of market capitalization. KPMG clients made up by far the largest number of adoptees (114), making up 38.5% of all SAB 108 filers and 13.73% of their own client base. Financial Services company adoptees make up the most significant number of industry filers utilizing SAB 108, making up 28.7% of all companies. Errors affecting liabilities and reserves accounts made up the most significant number and percentage of total SAB 108 restatements totaling 108 and 36.49%. A review of the ten largest positive and negative error correction changes (by dollar amount) reveals that for most of these companies the effect on current net income, if such adjustment had been recorded in the most recent year, would have been material.


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Audit Analytics Trend Reports. "SAB 108 Adoption Briefing" Jan 01, 2008. Alacra Store. Apr 22, 2018. <>
Audit Analytics Trend Reports. (2008). SAB 108 Adoption Briefing Jan 01, 2008. New York, NY: Alacra Store. Retrieved Apr 22, 2018 from <>
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