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As companies absorb all of the financial reporting changes for 2006 financial reporting-and look ahead -Financial Executives International has compiled the following list of the top 10 financial reporting challenges for 2007:
1. Internal controls- The sec and PCAOB are working on revised guidance for implementing section 404 of the Sarbanes-Oxley Act. It is expected that this new guidance will more clearly articulate how companies and auditors might take a more risk-based approach to its implementation.
2. Uncertain tax positions- FIN 48 "Accounting for Uncertainty in Income Taxes" will be effective for 2007 reporting. Many companies have experienced implementation issues associated with this interpretation, so its provisions must be applied carefully.
3. X8/?L-The sec has made extensible Business Reporting Language (XBRL) a priority. Expect more momentum in 2007 as more companies voluntarily adopt it and the sec continues to prioritize XBRL.
4. Fair l/a/ue-FAS 157, "Fair Value Measurement," must be adopted for financial statements for fiscal years beginning after Nov....