Discussion Question:Accounting Projects Completed by FASB” Please respond to the following:From the e-Activity, compare one (1) recently completed project to the old accounting standard, and predict the fundamental way in which the new standard will improve financial reporting. Provide support for your rationale.From the e-Activity, recommend two (2) internal controls that you would implement to ensure that corporations follow the new standard that you had explored in Part 1 of this discussion if you were given complete authority in the matter. Justify your response.FASB Case:ASU 2016-01 ACCOUNTING FOR FINANCIAL INSTRUMENTS—RECOGNITION AND MEASUREMENT (SUBTOPIC 825-10)OverviewOn January 05, 2016, the FASB completed its Classification and Measurement of Financial Instruments project by issuing ASU No. 2016-01, Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. The new guidance improves certain aspects of recognition, measurement, presentation and disclosure of financial instruments. To that end, the new guidance will:Benefit users by providing a more relevant measurement attribute for equity investments through the requirement of equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income.Decrease complexity for preparers by replacing the challenging impairment model for equity investments without readily determinable fair values with a simpler qualitative impairment assessment.Provide more decision-useful information by allowing an entity to report the change in fair value of a liability, measured under the fair value option that is attributable to changes in instrument-specific credit risk, in other comprehensive income.Reduce costs for other than public business entities by eliminating the requirement to disclose the fair values of financial assets and financial liabilities measured at amortized cost.Increase comparability by reducing the diversity in applying the deferred tax asset guidance to available-for-sale debt securities.Create consistency in fair value disclosures by eliminating an entity’s ability to estimate the disclosed fair values of financial assets and financial liabilities on the basis of entry prices.The new guidance affects all reporting organizations (whether public or private) that hold financial assets or owe financial liabilities. Effective DatesFor public business entities, the new guidance is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years.For all other entities (including not-for-profit organizations and employee benefit plans), the guidance is effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019.Early application of the guidance is permitted for all organizations that are not public business entities as of the fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Additionally, early application of the following provisions in the ASU is permitted for all entities as of the beginning of the fiscal year of adoption:The “own credit” provision, in which an organization should present separately in OCI the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk if the organization has elected to measure the liability at fair value in accordance with the fair value option for financial instruments.The provision that exempts private companies and not-for profit organizations from the requirement to apply the fair value of financial instruments disclosure guidance.Except for the early application guidance discussed above, early adoption of the amendments in this ASU are not permitted. Additional InformationAccounting Standards UpdatePress ReleaseTo Learn MoreFASB In Focus—a brief overview of what this change means for financial reportingHave A Question?Submit questions about the new requirements using our Technical Inquiry System.