assurance Accounting, Reporting and Auditing Developments April 13, 2018 Assurance Tax Advisory dhgllp.com

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1 ssurnce Q Accounting, Reporting nd Auditing Developments April 13, 2018 Assurnce Tx Advisory dhgllp.com

2 Accounting & Finncil Reporting Mtters...4 Tx Reform...4 Finncil Accounting Stndrds Bord (FASB)...5 U.S. Securities & Exchnge Commission (SEC)...6 Assurnce Mtters...7 Americn Institute of Certified Public Accountnts (AICPA)...7 Center for Audit Qulity (CAQ)...8 Appendix A Effective Dte Highlights for Public Business Entities in Appendix B Effective Dte Highlights for Public Business Entities in 2019 & Beyond...17 Appendix C Effective Dte Highlights for Privte Compnies in 2017 & Beyond...22 Appendix D SEC Finl Rules...38 ssurnce First Qurter 2018 Accounting, Reporting & Auditing Developments

3 first qurter 2018 ccounting & ssurnce updte The developments included in this Accounting nd Assurnce (A&A) Updte re intended to be reminder of recently issued ccounting nd uditing stndrds nd other guidnce tht my ffect our clients in the current reporting period. This qurterly A&A Updte is intended s generl informtion nd should not be relied upon s being definitive or llinclusive. Throughout the document we hve lso referenced other DHG A&A Updtes nd externl publictions, s pplicble. Recent qurterly A&A Updtes cn be found under Assurnce Alerts on the DHG Resource Center dhgllp.com 2018 by Dixon Hughes Goodmn LLP. All rights reserved. Permission is grnted to view, store, print, reproduce nd distribute ny pges of this Newsletter provided tht () no pge is modified nd (b) this pge is included with ny distribution. Disclimer: This publiction hs been prepred by the Dixon Hughes Goodmn LLP Professionl Stndrds Group nd contins informtion in summry form nd is therefore intended for generl guidnce only; it is not intended to be substitute for detiled reserch or the exercise of professionl judgment. You should consult with Dixon Hughes Goodmn LLP or other professionl dvisors fmilir with your prticulr fctul sitution for dvice concerning specific udit, tx, or other mtters before mking ny decision. ssurnce 3 First Qurter 2018 Accounting, Reporting & Auditing Developments

4 Accounting & Finncil Reporting Mtters Tx Reform SEC Releses Stff Accounting Bulletin No. 118 Due to the enctment of Tx Cuts nd Jobs Act (the Tx Act) on December 22, 2017, the SEC cknowledged potentil uncertinty nd diversity in views in the ppliction of ASC 740, Income Txes for situtions where the ccounting for certin income tx effects of the Tx Act were incomplete by the time finncil sttements re issued for the reporting period tht includes the enctment dte. As result, the SEC s Office of the Chief Accountnt nd the Division of Corportion Finnce relesed Stff Accounting Bulletin No. 118, Income Tx Accounting Implictions of the Tx Cuts nd Jobs Act (SAB 118). SAB 118 provides interpretive guidnce tht llows for provisionl mesurement period pproch s follows: 1. For income tx effects of the Tx Act in which the ccounting under ASC Topic 740 is complete, compnies must reflect these effects in the finncil sttements. These completed mounts would not be provisionl mounts. 2. For those specific income tx effects of the Tx Act in which the ccounting under ASC Topic 740 will be incomplete but resonble estimte cn be determined, compnies would record provisionl mount in the finncil sttements. 3. For those specific income tx effects of the Tx Act in which the ccounting under ASC Topic 740 will be incomplete but resonble estimte cnnot be determined, compnies would not report provisionl mounts nd would continue to pply ASC Topic 740 bsed on the provisions of the tx lws tht were in effect immeditely prior to the Tx Act being encted. For those income tx effects for which compny ws not ble to determine resonble estimte (such tht no relted provisionl mount ws reported for the reporting period in which the Tx Act ws encted), compny would report provisionl mounts in the first reporting period in which resonble estimte cn be determined. Any provisionl mounts included in n entity s finncil sttements during the mesurement period should be included in income from continuing opertions s n djustment to tx expense or benefit in the reporting period the mounts re determined. During the mesurement period, compnies my need to mke mesurement period djustments to provisionl mounts s informtion becomes known nd the ccounting for the effects of the Tx Act is completed. The SEC expects compnies to ct in good fith to complete the ccounting under ASC Topic 740 nd tht under no circumstnces should the mesurement period extend beyond one yer from the enctment dte. In response to questions received, the SEC relesed Complince nd Disclosure Interprettion (C&DI) which clrifies tht the remesurement of deferred tx sset to reflect the chnge in tx rte or tx lws is not n impirment under ASC Topic 740 nd s such would not trigger n obligtion to file under Item 2.06 (Mteril Impirments) of Form 8-K. However, the enctment could hve implictions for compny s finncil sttements including whether it is more likely thn not tht the DTA will be relized. In such event, compnies generlly my rely on the instruction to Item 2.06 nd disclose the impirment in its next periodic report. FASB Releses Stff Q&As in Response to Inquiries on Tx Reform During the first qurter of 2018, the Finncil Accounting Stndrds Bord (FASB) hs issued series of Q&A documents to ddress vrious finncil ccounting nd reporting implementtion issues relted to the enctment of the Tx Act. The Q&A topics re s follows: Whether Privte Compnies nd Not-for-Profits Cn Apply SAB 118 As mentioned bove, the SEC issued SAB 118 which provides trnsition implementtion guidnce for public compnies relted to the Tx Act. As result, stkeholders hve inquired whether the guidnce could be pplied by non-public nd not-for-profit entities. The FASB indicted tht they would not object to privte compny or not-for-profit entity voluntrily pplying the guidnce set forth in SAB 118, nd concluded such ppliction would be in ccordnce with ccounting principles generlly ccepted in the United Sttes (US GAAP). Whether to Discount the Tx Libility on the Deemed Reptrition The tx libility relted to the deemed reptrition of undistributed nd untxed foreign ernings nd profits should not be discounted to reflect the time vlue of money. Whether to Discount Alterntive Minimum Tx Credits Tht Become Refundble Alterntive minimum tx (AMT) tx credits tht will be used or ultimtely refunded should not be discounted to reflect the time vlue of money. Accounting for the Bse Erosion Anti-Abuse Tx Deferred tx ssets nd libilities tht my reverse nd be txed under the bse erosion nti-buse tx (BEAT) regime should be mesured nd recognized under the regulr tx regime, not bsed on the lower tx rtes of BEAT. Accounting for Globl Intngible Low-Txed Income Under the globl intngible low-txed income (GILTI) provisions of the Tx Act, entities will hve n ccounting policy election with respect to tretment of bsis differences tht my be txed s GILTI in the future s to whether they should be recognized currently or included in the period incurred. ASU Income Txes (Topic 740): Amendments to SEC Prgrphs Pursunt to SEC Stff Accounting Bulletin No. 118 (SEC Updte) This Accounting Stndrds Updte (ASU) mends certin SEC mteril in Topic 740 for the income tx ccounting implictions of the recently issued Tx Act nd generlly serves to codify the SEC s guidnce relesed in SAB 118 mentioned bove. The ASU is effective upon inclusion in the FASB Codifiction. ssurnce 4 First Qurter 2018 Accounting, Reporting & Auditing Developments

5 Accounting & Finncil Reporting Mtters Finncil Accounting Stndrds Bord (FASB) The following re non-tx reform relted ASUs recently issued by the FASB. For summry of their effective dtes, refer to Appendix A nd B for public business entities nd Appendix C for privte compnies. ASU Investments Debt Securities (Topic 320) nd Regulted Opertions (Topic 980): Amendments to SEC Prgrphs Pursunt to SEC Stff Accounting Bulletin No. 117 nd SEC Relese No (SEC Updte) As noted in the Fourth Qurter 2017 Accounting & Assurnce Updte, in November 2017 the SEC issued Stff Accounting Bulletin No. 117 (SAB 117) which updtes SAB guidnce in order to bring existing guidnce into conformity with the FASB Codifiction Topic 321, Investments Equity Securities. Specificlly, SAB 117 mends Topic 5, Miscellneous Accounting, to note tht Topic 5.M is no longer pplicble upon doption of ASC Topic 321. In Mrch 2018, FASB issued ASU which removes relted SEC guidnce in the Codifiction in SAB Topic 5.M, Other-Thn-Temporry Impirment of Certin Investments in Equity Securities, specificlly ASC S99-1. The ASU lso removes specil blnce sheet requirements in Regultion S-X Rule 3A-05 for Public Utility Holding Compnies. The chnges re effective when issued. ASU Technicl Corrections nd Improvements to Finncil Instruments Overll (Subtopic ); Recognition nd Mesurement of Finncil Assets nd Finncil Libilities This ASU consist of mendments to clrify certin spects of the guidnce issued ASU , Finncil Instruments Overll (Subtopic ): Recognition nd Mesurement of Finncil Assets nd Finncil Libilities. Issue 1: Equity Securities without Redily Determinble Fir Vlue Discontinution Clrifies tht n entity mesuring n equity security using the mesurement lterntive my chnge its mesurement pproch to fir vlue method in ccordnce with Topic 820, Fir Vlue Mesurement, through n irrevocble election tht would pply to tht security nd ll identicl or similr investments of the sme issuer. Issue 2: Equity Securities without Redily Determinble Fir Vlue Adjustments Amendments clrify tht the djustments mde under the mesurement lterntive re intended to reflect the fir vlue of the security s of the dte tht the observble trnsction for similr security took plce. Issue 3: Forwrd Contrcts nd Purchsed Options Clrifies tht remesuring the entire vlue of forwrd contrcts nd purchsed options is required when observble trnsctions occur on the underlying equity securities. Issue 4: Presenttion Requirements for Certin Fir Vlue Option Libilities The mendments note tht when the fir vlue option is elected for finncil libility, entities should pply the guidnce in prgrph , regrdless of whether the fir vlue option ws elected under either Subtopic , Derivtives nd Hedging Embedded Derivtives, or , Finncil Instruments Overll. Issue 5: Fir Vlue Option Libilities Denominted in Foreign Currency The mendments clrify tht for finncil libilities for which the fir vlue option is elected, the mount of chnge in fir vlue tht reltes to the instrumentspecific credit risk should first be mesured in the currency of denomintion when presented seprtely from the totl chnge in fir vlue of the finncil libility. Then, both components of the chnge in the fir vlue of the libility should be remesured into the functionl currency of the reporting entity using end-of-period spot rtes. Issue 6: Trnsition Guidnce for Equity Securities without Redily Determinble Fir Vlue - The mendments clrifies tht the prospective trnsition pproch for equity securities without redily determinble fir vlue in the mendments in ASU No is ment only for instnces in which the mesurement lterntive is pplied. Further, n insurnce entity subject to the guidnce in Topic 944, Finncil Services Insurnce, should pply prospective trnsition method when pplying the mendments relted to equity securities without redily determinble fir vlues nd this should be pplied consistently to the entire popultion of equity securities for which the mesurement lterntive is elected. For public business entities, the ASU is effective for fiscl yers beginning fter December 15, 2017, nd interim periods within those fiscl yers beginning fter June 15, Public business entities with fiscl yers beginning between December 15, 2017, nd June 15, 2018, re not required to dopt this ASU until the interim period beginning fter June 15, 2018, nd public business entities with fiscl yers beginning between June 15, 2018, nd December 15, 2018, re not required to dopt these mendments before dopting the mendments in ASU For ll other entities, the effective dte is the sme s the effective dte in ASU All entities my erly dopt this ASU for fiscl yers beginning fter December 15, 2017, including interim periods within those fiscl yers, s long s they hve dopted ASU ssurnce 5 First Qurter 2018 Accounting, Reporting & Auditing Developments

6 Accounting & Finncil Reporting Mtters ASU Income Sttement Reporting Comprehensive Income (Topic 220); Reclssifiction of Certin Tx Effects from Accumulted Other Comprehensive Income This ASU llows reclssifiction from ccumulted other comprehensive income to retined ernings for strnded tx effects resulting from the Act. Additionlly, the ASU elimintes the strnded tx effects resulting from the Act nd is intended to improve the usefulness of informtion reported to finncil sttement users. However, becuse the mendments only relte to the reclssifiction of the income tx effects of the Act, the underlying guidnce tht requires tht the effect of chnge in tx lws or rtes be included in income from continuing opertions is not ffected. The mendments in this ASU lso require certin disclosures bout strnded tx effects. Erly doption of the mendments in this ASU is permitted, including doption in ny interim period, (1) for public business entities for reporting periods for which finncil sttements hve not yet been issued nd (2) for ll other entities for reporting periods for which finncil sttements hve not yet been mde vilble for issunce. This ASU should be pplied either in the period of doption or retrospectively to ech period (or periods) in which the effect of the chnge in the U.S. federl corporte income tx rte in the Act is recognized. ASU Leses (Topic 842) Lnd Esement Prcticl Expedient for Trnsition to Topic 842 This ASU clrifies the ppliction of the new leses guidnce to lnd esements nd eses doption efforts for certin lnd esements. Lnd esements (commonly referred to s rights of wy) represent the right to use, ccess, or cross nother entity s lnd for specified purpose. Lnd esements re used by utility nd telecommunictions compnies, for exmple, when they need to tke smll strip of lnd, or esement, to bury wires. Not ll compnies hve historiclly ccounted for them s leses. The mendments in this ASU permit n entity to elect n optionl trnsition prcticl expedient to not evlute under Topic 842 lnd esements tht exist or expired before the entity s doption of Topic 842 nd tht were not previously ccounted for s leses under Topic 840. An entity tht elects this prcticl expedient should pply the prcticl expedient consistently to ll of its existing or expired lnd esements tht were not previously ccounted for s leses under Topic 840. Once n entity dopts Topic 842, it should pply tht topic prospectively to ll new (or modified) lnd esements to determine whether the rrngement should be ccounted for s lese. The effective dte nd trnsition requirements re the sme s the effective dte nd trnsition requirements in ASU , which my be erly dopted, nd Exmple 10 of Subtopic An entity tht erly dopted Topic 842 should pply the mendments in the new ASU upon issunce. ssurnce 6 U.S. Securities & Exchnge Commission (SEC) SEC Amends Exemptions from Investment Adviser Registrtion for FAST Act The SEC hs issued finl rule, Exemptions from Investment Adviser Registrtion for Advisers to Smll Business Investment Compnies, to llow certin investment dvisers to smll business investment compnies n exemption from registrtion with the SEC under the Investment Advisers Act of 1940 (Advisers Act). Specificlly, the rule updtes the definition of venture cpitl funds within the Advisers Act to include smll business investment compnies nd mends the definition of ssets under mngement to exclude the ssets of smll business investment compnies. The mendments were effective Mrch 12, 2018 SEC Releses Sttement nd Publishes Interpretive Guidnce on Public Compny Cybersecurity Disclosures On Februry 21, 2018 the SEC relesed public sttement nd interpretive guidnce to highlight registrnt s requirements to ddress cybersecurity risks nd incidents within existing SEC requirements, nd lrgely builds upon SEC Division of Corportion Finnce guidnce issued in SEC Chirmn Jy Clyton stted tht the views expressed in the SEC s interpretive guidnce intends to promote clerer nd more robust disclosure by compnies bout cyber security risks nd incidents, resulting in more complete informtion being vilble to investors. Further, the Chirmn urge[s] public compnies to exmine their controls nd procedures, with not only their securities lw disclosure obligtions in mind, but lso reputtionl considertions round sles of securities by executives. Ares where cybersecurity risks nd incidents re to be considered include: Disclosure controls nd procedures, Periodic nd current reporting requirements, including disclosure res such s risk fctors, MD&A, nd legl proceedings, Bord requirements for risk oversight, Insider trding prohibitions, nd Complince with Regultion FD. views Although registrnt my not hve historiclly been trget or victim of cybersecurity incident, registrnts should hve pproprite processes nd controls in plce to monitor, nlyze, nd disclose mtters s they relte to cyber security. The guidnce lso discusses finncil sttement disclosure expecttions in the event of brech or other cyber event, including the SEC s expecttions tht compny s finncil reporting nd control systems would be designed to provide resonble ssurnce tht informtion bout the rnge nd mgnitude of the finncil impcts of cybersecurity incident would be incorported into its finncil sttements on timely bsis s the informtion becomes vilble. First Qurter 2018 Accounting, Reporting & Auditing Developments

7 Accounting & Finncil Reporting Mtters Other SEC Mtters On Februry 21, 2018, the SEC voted to postpone the complince dedline for open-end funds for certin elements of the SEC s liquidity risk mngement progrm rule tht ws dopted in October As result of the vote, the complince dedline for implementtion of the clssifiction nd clssifiction-relted elements of the rule is June 1, 2019 for lrger fund groups nd December 1, 2019 for smller fund groups. All other requirements of the rule re unchnged. The SEC hs issued notice, Adjustments to Civil Monetry Penlty Amounts, which requires ll gencies to djust civil monetry penlty mounts nnully for infltion nd publish the revised mounts in the Federl Registrr. The mounts were effective beginning on Jnury 15, 2018 nd will pply to penlties imposed fter tht dte. The SEC hs issued finl rule, Tretment of Certin Communictions Involving Security-Bsed Swps Tht My Be Purchsed Only By Eligible Contrct Prticipnts to inform tht certin communictions involving certin security-bsed swps such s publiction or distribution of price quotes do not constitute offers for the purposes of Section 5 of the Securities Act of 1933 (the Act) nd s such do not require registrtion under the Act or otherwise be required to qulify for n exemption under the Act. The rule lso pplies to brokers, delers, or security-bsed swp deler s communictions tht meet the definition of reserch report under Rule 139(d).The rule ws effective Jnury 16, In finl rule, Amendments to Forms nd Schedules to Remove Voluntry Provision of Socil Security Numbers, the SEC hs removed the portions of forms relting to vrious cts requesting filers tht re nturl persons to furnish socil security numbers. The rule ws effective Jnury 30, The SEC hs mde vrious upgrdes to the Electronic Dt Gthering, Anlysis, nd Retrievl System (EDGAR) filer mnul nd relted rules. These upgrdes went into effect on Mrch 12, Assurnce Mtters Americn Institute of Certified Public Accountnts (AICPA) AICPA Issues Interprettions on Assurnce Reporting Under Two Sets of Stndrds The AICPA s Auditing Stndrds Bord (ASB) hs issued new Interprettion under AU-C Section 9700, Forming n Opinion nd Reporting on Finncil Sttements - Auditing Interprettions of Section 700 Interprettion. The Interprettion is in response to the Public Compny Accounting Oversight Bord s (PCAOB) doption of Auditing Stndrd 3101, The Auditor s Report on n Audit of Finncil Sttements When the Auditor Expresses n Unqulified Opinion nd serves to provide guidnce for uditor s reports when reporting under both the AICPA s Generlly Accepted Auditing Stndrds (GAAS) nd the PCAOB s Auditing Stndrds. When reporting under both stndrds, the AICPA requires the use of the PCAOB form of report (which would include uditor tenure nd Criticl Audit Mtters (CAMs) once effective) with n mendment to stte tht the udit ws lso conducted in ccordnce with GAAS. The interprettion notes there my be other modifictions to the PCAOB form of report necessry in specific circumstnces, e.g. if the uditor is not required to be independent in ccordnce with pplicble regultions of the SEC nd the PCAOB, or if the uditor performed the udit in ccordnce with the uditing stndrds of the PCAOB but not the relted professionl prctice stndrds, including independence rules, of the PCAOB. Additionlly, the AICPA hs updted Attest Interprettion No. 4, Performing nd Reporting on n Attesttion Enggement Under Two Sets of Attesttion Stndrds, of AT-C section 105, Concepts Common to All Attesttion Enggements to provide guidnce for performing ttesttion enggements under two different sets of ttesttion stndrds. Generlly, the revisions serve to illustrte tht n ttesttion enggement my be performed under two sets of ttesttion stndrds so long s both sets of stndrds hve been dhered to in their entirety. In ddition, the updtes include exmple reports of n ttesttion enggement performed under both the AICPA ttesttion stndrds nd the PCAOB interim ttesttion stndrds. ssurnce 7 First Qurter 2018 Accounting, Reporting & Auditing Developments

8 Assurnce Mtters Other AICPA Mtters The AICPA hs issued n updte to the Q&A on long-term investments (Section 2220 prgrph.28). The updte intends to ssist compnies when implementing certin provisions of FASB ASC 820, Fir Vlue Mesurement relted to the definition of Redily Determinble Fir Vlue nd its interction with the net sset vlue (NAV) prcticl expedient. The AICPA hs issued FAQs ddressing independence considertions when there is long ssocition of senior enggement tem members with members of the client s mngement. The AICPA hs issued new Technicl Questions nd Answers (TQAs) which primrily serve to ddress questions relted to the need for single or multiple enggement letters nd mngement representtion letters in multiemployer pln enggement. Center for Audit Qulity (CAQ) New Lese Accounting Stndrd Audit Committee Communiction Tool The CAQ s udit committee communiction tool, Prepring for the New Leses Accounting Stndrd: A Tool for Audit Committees, is designed to ssist udit committees exercise their oversight responsibilities s compnies implement the new lese ccounting stndrd (tht will begin to tke effect in Jnury 2019). It includes n overview of the new stndrd nd offers importnt questions for udit committee members to consider for successful implementtion. This publiction is orgnized into four sections nd, while not ll-inclusive, provides exmples of questions udit committees my sk of mngement nd uditors (where pproprite) relted to the compny s implementtion efforts 1. Understnding the New Leses Stndrd 2. Evluting the Compny s Impct Assessment 3. Evluting the Implementtion Project Pln 4. Other Implementtion Considertions Non-GAAP Mesures: Rodmp for Audit Committees The CAQ hs published new report, Non-GAAP Mesures: Rodmp for Audit Committees, which discusses key mtters for udit committees to consider in their oversight of finncil mesures tht do not conform to U.S. Generlly Accepted Accounting Principles (GAAP). It lso recommends prctices to ssess whether compny s non-gaap metrics present blnced representtion of the compny s performnce. The CAQ lso relesed compnion video feturing interviews with udit committee chirs tht provides dditionl context nd rel-life exmples of how udit committees re thinking bout nd overseeing non-gaap mesures. ssurnce 8 First Qurter 2018 Accounting, Reporting & Auditing Developments

9 Appendix A - Accounting Stndrds Affecting Public Business Entities in 2018 The following tble presents ASUs tht generlly become effective during nd for clendr yer-end Plese refer to the individul ASUs in their entirety for dditionl guidnce. Accounting Stndrds Updte Effective Dte of Public Business Entities Trnsition Erly Adopt Summry ASU Income Txes (Topic 740): Amendments to SEC Prgrphs Pursunt to SEC Stff Accounting Bulletin No. 118 (SEC Updte) ASU Investments Debt Securities (Topic 320) nd Regulted Opertions (Topic 980): Amendments to SEC Prgrphs Pursunt to SEC Stff Accounting Bulletin No. 117 nd SEC Relese No (SEC Updte) Immeditely N/A N/A Immeditely N/A N/A This ASU mends certin SEC mteril in Topic 740 for the income tx ccounting implictions of the recently issued Tx Cuts nd Jobs Act (the Tx Act) nd generlly serves to codify the SEC s guidnce relesed in SAB 118 mentioned bove. The ASU is effective upon inclusion in the FASB Codifiction. This ASU removes SEC guidnce in the Codifiction in SAB Topic 5.M, Other-Thn-Temporry Impirment of Certin Investments in Equity Securities, specificlly ASC S99-1. The ASU lso removes specil blnce sheet requirements in Regultion S-X Rule 3A-05 for Public Utility Holding Compnies. The chnges re effective when issued. For public business entities, the ASU is effective for fiscl yers beginning fter December 15, 2017, nd interim periods within those fiscl yers beginning fter June 15, This ASU consist of mendments to clrify certin spects of the guidnce issued ASU , Finncil Instruments Overll (Subtopic ): Recognition nd Mesurement of Finncil Assets nd Finncil Libilities s follows: ASU Technicl Corrections nd Improvements to Finncil Instruments Overll (Subtopic ); Recognition nd Mesurement of Finncil Assets nd Finncil Libilities Public business entities with fiscl yers beginning between December 15, 2017, nd June 15, 2018, re not required to dopt this ASU until the interim period beginning fter June 15, 2018, nd public business entities with fiscl yers beginning between June 15, 2018, nd December 15, 2018, re not required to dopt these mendments before dopting the mendments in ASU N/A 1 1. Equity Securities without Redily Determinble Fir Vlue Discontinution 2. Equity Securities without Redily Determinble Fir Vlue Adjustments 3. Forwrd Contrcts nd Purchsed Options 4. Presenttion Requirements for Certin Fir Vlue Option Libilities 5. Fir Vlue Option Libilities Denominted in Foreign Currency 6. Trnsition Guidnce for Equity Securities without Redily Determinble Fir Vlue 1. All entities my erly dopt this ASU for fiscl yers beginning fter December 15, 2017, including interim periods within those fiscl yers, s long s they hve dopted ASU ssurnce 9 First Qurter 2018 Accounting, Reporting & Auditing Developments

10 Appendix A - Accounting Stndrds Affecting Public Business Entities in 2018 Accounting Stndrds Updte Effective Dte of Public Business Entities Fiscl yers beginning fter December 15, 2017, including interim periods within those yers. Trnsition Erly Adopt Summry ASU Service Concession Arrngements (Topic 853): Determining the Customer of the Opertion Services If the entity is not-forprofit tht hs issued, or is conduit bond obligor for, securities tht re trded, listed, or quoted on n exchnge or n over-the-counter mrket, nd n employee benefit pln tht files or furnishes finncil sttements with the SEC, the mendments in this updte re effective for fiscl yer beginning fter December 15, 2017 including interim periods within those fiscl yers. Full or This ASU ws issued to provide guidnce on how n operting entity determines the customer of the opertion services for trnsctions within the scope of Topic 853, Service Concession Arrngements. A service concession rrngement is n rrngement between grntor nd n operting entity whereby the operting entity will operte the grntor's infrstructure for specified period of time. The operting entity lso my mintin the infrstructure, nd it lso my be required to provide periodic cpitl-intensive mintennce to enhnce or extend the life of the infrstructure. ASU Compenstion - Stock Compenstion (Subtopic 718): Scope of Modifiction Accounting Annul periods beginning fter December 15, 2017, including interim periods within nnul periods Prospective This ASU ws issued to provide guidnce bout wht chnges to the terms or conditions of shre-bsed pyment wrd require n entity to pply modifiction ccounting in Topic 718. ssurnce 10 First Qurter 2018 Accounting, Reporting & Auditing Developments

11 Appendix A - Accounting Stndrds Affecting Public Business Entities in 2018 Accounting Stndrds Updte Effective Dte of Public Business Entities Trnsition Erly Adopt Summry ASU Compenstion - Retirement Benefits (Topic 715): Improving the Presenttion of Net Periodic Pension Cost nd Net Periodic Postretirement Benefit Cost Annul reporting periods beginning fter December 15, 2017, including interim reporting periods within those nnul reporting periods. Prospective nd 2 This ASU ws issued to improve the presenttion of net periodic pension cost nd net periodic postretirement benefit cost. The mendments require tht n employer report the service cost component in the sme line item or items s other compenstion costs rising from services rendered by the pertinent employees during the period. The other components of net benefit cost re required to be presented in the income sttement seprtely from the service cost component nd outside subtotl of income from opertions, if one is presented. If seprte line item or items re used to present the other components of net benefit costs, tht line item or items must be ppropritely described. If seprte line item or items re not used, the line item or items used in the income sttement to present the other components of net benefit cost must be disclosed. The mendments lso llow only the service cost component to be eligible for cpitliztion when pplicble (e.g., s cost of internlly mnufctured inventory or self-constructed sset). ASU Other Income - Gins nd Losses from the Derecognition of Nonfinncil Assets (Subtopic ): Clrifying the Scope of Asset Derecognition Guidnce nd Accounting for Prtil Sles of Nonfinncil Assets Annul reporting periods beginning fter December 15, 2017, including interim reporting periods within those nnul reporting periods Note: entities should dopt concurrently with Full or This ASU ws issued to clrify tht finncil sset is within the scope of Subtopic if it meets the definition of n in substnce nonfinncil sset. The mendments lso define the term "in substnce finncil sset." The mendments clrify tht nonfinncil ssets within the scope of Subtopic my include nonfinncil ssets trnsferred within legl entity to counterprty. For exmple, prent my trnsfer control of nonfinncil ssets by trnsferring ownership interests in consolidted subsidiry. A contrct tht includes the trnsfer of ownership interests in one or more consolidted subsidiries is within the scope of Subtopic if substntilly ll of the fir vlue of the ssets tht re promised to the counterprty in contrct is concentrted in nonfinncil ssets. The mendments lso clrify tht n entity should identify ech distinct nonfinncil sset or in substnce nonfinncil sset promised to counterprty nd derecognize ech sset when counterprty obtins control of tht sset. 2. The mendments in this ASU should be pplied retrospectively for the presenttion of the service cost component nd the other components of net periodic pension cost nd net periodic postretirement benefit cost in the income sttement nd prospectively, on nd fter the effective dte, for the cpitliztion of the service cost component of net periodic pension cost nd net periodic postretirement benefit in ssets. The mendments llow prcticl expedient tht permits n employer to use the mounts disclosed in its pension nd other postretirement benefit pln note for the prior comprtive periods s the estimtion bsis for pplying the retrospective presenttion requirements. Disclosure tht the prcticl expedient ws used is required. ssurnce 11 First Qurter 2018 Accounting, Reporting & Auditing Developments

12 Appendix A - Accounting Stndrds Affecting Public Business Entities in 2018 Accounting Stndrds Updte Effective Dte of Public Business Entities Trnsition Erly Adopt Summry ASU Accounting Chnges nd Error Corrections (Topic 250) nd Investments - Equity Method nd Joint Ventures (Topic 323): Amendments to SEC Prgrphs Pursunt to Stff Announcements t the September 22, 2016 nd November 17, 2016 EITF Meetings Immeditely Prospective N/A ASU ws issued in order to ddress disclosure of the impct tht recently issued ccounting stndrds will hve on the finncil sttements of registrnt when such stndrds re dopted in future period. The SEC stff expects robust disclosures in ccordnce with Stff Accounting Bulletin (SAB) Topic 11.M for current yer Form 10-K filings nd upcoming qurterly filings. This ASU specificlly ddresses ASU , Revenue from Contrcts with Customers (Topic 606); ASU , Leses (Topic 842); nd ASU , Finncil Instruments-Credit Losses (Topic 326): Mesurement of Credit Losses on Finncil Instruments nd subsequent mendments. ASU Business Combintions (Topic 805): Clrifying the Definition of Business Annul reporting periods beginning fter December 15, 2017, including interim reporting periods within those nnul reporting periods. Prospective 3 ASU ws issued to clrify the definition of business in order to ssist entities with evluting whether trnsctions should be ccounted for s cquisitions (or disposls) of ssets or businesses. This ASU provides screen whereby trnsction will be ccounted for s n sset purchse (or disposl) if substntilly ll of the fir vlue of the gross ssets cquired (disposed) is concentrted in single identifible sset or group of similr identifible ssets. If the screen is not met, the entity will evlute whether it is business cquisition under revised criteri. The mendments in this ASU re expected to cuse fewer trnsctions to be identified s businesses. While this ASU will pply to ll entities nd industries, it is expected to prticulrly impct the rel estte nd phrmceuticl/biotech industries. ASU Technicl Corrections nd Improvements to Topic 606, Revenue from Contrcts with Customers Annul reporting periods beginning fter December 15, 2017, including interim reporting periods within those nnul reporting periods. Note: entities should dopt concurrently with Full or This ASU is intended to improve the operbility nd understndbility of the implementtion guidnce by providing clrifictions nd prcticl expedients on the following issues: lon gurntee fees, contrct costs, provisions for losses on construction-type nd production-type contrcts, scope of topic 606, disclosure of remining performnce obligtions, disclosure of prior period performnce obligtions, contrct modifictions, contrct sset versus receivble, refund libility, dvertising costs, fixed odds wgering contrcts in the csino industry nd cost cpitliztion for dvisors to privte nd public funds. 3. Erly ppliction of the mendments in this Updte is llowed s follows: () For trnsctions for which the cquisition dte occurs before the issunce dte or effective dte of the mendments, only when the trnsction hs not been reported in finncil sttements tht hve been issued or mde vilble for issunce. (b) For trnsctions in which subsidiry is deconsolidted or group of ssets is derecognized tht occur before the issunce dte or effective dte of the mendments, only when the trnsction hs not been reported in finncil sttements tht hve been issued or mde vilble for issunce. ssurnce 12 First Qurter 2018 Accounting, Reporting & Auditing Developments

13 Appendix A - Accounting Stndrds Affecting Public Business Entities in 2018 Accounting Stndrds Updte Effective Dte of Public Business Entities Trnsition Erly Adopt Summry ASU Sttement of Csh Flows (Topic 230): Restricted Csh Fiscl yers beginning fter December 15, 2017, nd interim periods within those fiscl yers. ASU ws issued to ddress diversity in prctice in the clssifiction nd presenttion of chnge in restricted csh on the sttement of csh flows under Topic 230. The mendments in this Updte require tht sttement of csh flows explin the chnge during the period in the totl of csh, csh equivlents, nd mounts generlly described s restricted csh or restricted csh equivlents. Therefore, mounts generlly described s restricted csh nd restricted csh equivlents should be included with csh nd csh equivlents when reconciling the beginning-of-period nd end-ofperiod totl mounts shown on the sttement of csh flows. ASU Income Txes (Topic 740): Intr-Entity Trnsfers of Assets Other Thn Inventory Annul reporting periods beginning fter December 15, 2017, including interim reporting periods within those nnul reporting periods. ASU ws issued to improve the ccounting for the income tx consequences of intr-entity trnsfers of ssets other thn inventory. The inititive is designed to reduce the complexity in ccounting stndrds. ASU Sttement of Csh Flows (Topic 230): Clssifiction of Certin Csh Receipts nd Csh Pyments Fiscl yers beginning fter December 15, 2017 nd interim periods within those fiscl yers. ASU ws issued to ddress diversity in prctice of how certin csh receipts nd csh pyments re currently presented nd clssified in the sttement of csh flows. ASU Revenue from Contrcts with Customers (Topic 606): Nrrow-Scope Improvements nd Prcticl Expedients Annul reporting periods beginning fter December 15, 2017, including interim reporting periods within those nnul reporting periods. Note: entities should dopt concurrently with Full or This ASU is intended to improve the operbility nd understndbility of the implementtion guidnce by providing clrifictions nd prcticl expedients on the following issues: ssessing collectbility criterion in prgrph (e) nd ccounting for contrcts tht do not meet the criteri for step one of the revenue recognition model, presenttion of sles txes nd other similr txes collected from customers, noncsh considertions, contrct modifictions t trnsition, completed contrcts t trnsition. ssurnce 13 First Qurter 2018 Accounting, Reporting & Auditing Developments

14 Appendix A - Accounting Stndrds Affecting Public Business Entities in 2018 Accounting Stndrds Updte Effective Dte of Public Business Entities Trnsition Erly Adopt Summry ASU No Revenue Recognition (Topic 605) nd Derivtives nd Hedging (Topic 815): Rescission of SEC Guidnce Becuse of Accounting Stndrds Updtes nd Pursunt to Stff Announcements t the Mrch 3, 2016 EITF Meeting Fiscl yers beginning fter December 15, 2017, including interim periods within those yers. Full or This ASU rescinds the following SEC Stff Observer comments tht re codified in Topic 605, Revenue Recognition, nd Topic 932, Extrctive Activities Oil nd Gs, effective upon doption of Topic 606, Revenue from Contrcts with Customers. Specificlly, registrnts should not rely on the following SEC Stff Observer comments upon doption of Topic 606: Revenue nd Expense Recognition for Freight Services in Process, which is codified in prgrph S99-2; Accounting for Shipping nd Hndling Fees nd Costs, which is codified in prgrph S99-1; Accounting for Considertion Given by Vendor to Customer (including Reseller of the Vendor s Products), which is codified in prgrph S99-1; nd Accounting for Gs-Blncing Arrngements (i.e., use of the entitlements method ), which is codified in prgrph S99-5. ASU Revenue from Contrcts with Customers (Topic 606): Identifying Performnce Obligtions nd Licensing Annul reporting periods beginning fter December 15, 2017, including interim reporting periods within those nnul reporting periods. Note: entities should dopt concurrently with Full or The mendments in this ASU provide clrifiction to two components of Topic 606: 1) identifying performnce obligtions, nd 2) licensing implementtion guidnce. ASU Revenue from Contrcts with Customers (Topic 606): Principl versus Agent Considertions (Reporting Revenue Gross versus Net) Annul reporting periods beginning fter December 15, 2017, including interim reporting periods within those nnul reporting periods. Note: entities should dopt concurrently with Full or The mendments re intended to improve the implementtion guidnce on principl versus gent considertions by mending existing illustrtive exmples nd dding new exmples. ssurnce 14 First Qurter 2018 Accounting, Reporting & Auditing Developments

15 Appendix A - Accounting Stndrds Affecting Public Business Entities in 2018 Accounting Stndrds Updte Effective Dte of Public Business Entities Trnsition Erly Adopt Summry ASU Libilities Extinguishments of Libilities (Subtopic ): Recognition of Brekge for Certin Prepid Stored-Vlue Products Fiscl yers beginning fter December 15, 2017, including interim periods within those yers. Full or The mendments, which pply to entities tht offer certin prepid stored vlue products, provide nrrow scope exception to the guidnce in Subtopic tht requires brekge for those libilities be ccounted for consistent with the brekge guidnce in Topic 606 Revenue from Contrcts with Customers. There is no specific guidnce for the derecognition of prepid stored-vlue product libilities. ASU Finncil Instruments Overll (Subtopic ): Recognition nd Mesurement of Finncil Assets nd Finncil Libilities Fiscl yers beginning fter December 15, 2017, nd interim periods within nnul periods beginning fter December 15, Prospective 4 This ASU mends vrious guidnce such s requiring equity investments to be mesured t fir vlue nd ny chnges in fir vlue to be recognized in the income sttement, public entities to use the exit price notion to mesure the fir vlue of finncil instruments for disclosure purposes, nd seprte presenttion of finncil ssets nd libilities by mesurement ctegory nd form of finncil sset. It lso elimintes the requirement to disclose the methods nd ssumptions used to estimte fir vlue of finncil instruments mesured t mortized cost. See lso, DHG publiction FASB Releses New Stndrd on Clssifiction & Mesurement of Finncil Instruments issued in Jnury Erly ppliction by public business entities to finncil sttements of fiscl yers or interim periods tht hve not yet been issued or, by ll other entities, tht hve not yet been mde vilble for issunce of the following mendments in this Updte re permitted s of the beginning of the fiscl yer of doption: () An entity should present seprtely in other comprehensive income the portion of the totl chnge in the fir vlue of libility resulting from chnge in the instrument-specific credit risk if the entity hs elected to mesure the libility t fir vlue in ccordnce with the fir vlue option for finncil instruments or (b) Entities tht re not public business entities re not required to pply the fir vlue of finncil instruments disclosure guidnce in the Generl Subsection of Section Except for the erly ppliction guidnce discussed here, erly doption of the mendments in this ASU is not permitted. ssurnce 15 First Qurter 2018 Accounting, Reporting & Auditing Developments

16 Appendix A - Accounting Stndrds Affecting Public Business Entities in 2018 Accounting Stndrds Updte Effective Dte of Public Business Entities Trnsition Erly Adopt Summry ASU : Revenue from Contrcts with Customers (Topic 606) & ASU Revenue From Contrcts With Customers (Topic 606): Deferrl of the Effective Dte Fiscl yers beginning fter December 15, 2017, including interim periods within those yers. Full or On My 28, 2014, the FASB nd the Interntionl Accounting Stndrds Bord (the IASB) (collectively the bords ) issued their sweeping revenue recognition stndrd, Revenue from Contrcts with Customers. This multiyer joint project with the IASB received more thn 1,500 comment letters throughout the process. The core principle of the new stndrd is tht n entity should recognize revenue to depict the trnsfer of promised goods or services to customers in n mount tht reflects the considertion to which the entity expects to be entitled in exchnge for those goods or services. The stndrd provides five-step process for recognizing revenue: 1. Identify the contrct with customer, 2. Identify the performnce obligtions in the contrct, 3. Determine the trnsction price, 4. Allocte the trnsction price to the performnce obligtions in the contrct, nd 5. Recognize revenue when (or s) the entity stisfies performnce obligtion. The mendments in ASU defer the effective dte of ASU , Revenue from Contrcts with Customers (Topic 606) for one yer. For public business entities, erlier ppliction is permitted only s of nnul reporting periods beginning fter December 15, 2016, including interim reporting periods within tht reporting period. All other entities my elect to pply this guidnce s of nnul reporting periods beginning fter December 15, 2016, including interim reporting periods within nnul reporting periods beginning one yer fter the nnul reporting period in which n entity first pplies the guidnce in this ASU. See DHG A&A Updte FASB Issues Long-Awited Revenue Recognition Stndrd, for dditionl informtion. ssurnce 16 First Qurter 2018 Accounting, Reporting & Auditing Developments

17 Appendix B - Accounting Stndrds Affecting Public Business Entities in 2019 nd beyond The following tble presents ASUs tht become effective for 2019 fiscl yers nd beyond. Plese refer to the individul ASUs in their entirety for dditionl guidnce. Accounting Stndrds Updte Effective Dte Public Business Enterprises Trnsition Erly Adopt Summry ASU Income Sttement Reporting Comprehensive Income (Topic 220); Reclssifiction of Certin Tx Effects from Accumulted Other Comprehensive Income Fiscl yers beginning fter December 15, 2018, nd interim periods within those fiscl yers. 5 This ASU llows reclssifiction from ccumulted other comprehensive income to retined ernings for strnded tx effects resulting from the Act. Additionlly, the ASU elimintes the strnded tx effects resulting from the Act nd is intended to improve the usefulness of informtion reported to finncil sttement users. However, becuse the mendments only relte to the reclssifiction of the income tx effects of the Act, the underlying guidnce tht requires tht the effect of chnge in tx lws or rtes be included in income from continuing opertions is not ffected. The mendments in this Updte lso require certin disclosures bout strnded tx effects. ASU Leses (Topic 842) Lnd Esement Prcticl Expedient for Trnsition to Topic 842 Effective with ASU N/A The mendments in this ASU permit n entity to elect n optionl trnsition prcticl expedient to not evlute under Topic 842 lnd esements tht exist or expired before the entity s doption of Topic 842 nd tht were not previously ccounted for s leses under Topic 840. An entity tht elects this prcticl expedient should pply the prcticl expedient consistently to ll of its existing or expired lnd esements tht were not previously ccounted for s leses under Topic 840. ASU Codifiction Improvements to Topic 995, U.S. Stemship Entities: Elimintion of Topic 995 Fiscl yers beginning fter December 15, 2018, nd interim periods within those fiscl yers. This ASU elimintes Topic 995, U.S. Stemship Entities, from the FASB Codifiction s the guidnce is no longer considered relevnt. The guidnce in Topic 995 on trnsitioning to the requirements of Topic 740 is no longer relevnt becuse sttutory funds deposited on or before December 15, 1992, hve reched the 25-yer limit. Entities lso should disclose the mounts nd types of temporry differences for which deferred tx libility hd not previously been recognized. 5. The mendments in this Updte should be pplied either in the period of doption or retrospectively to ech period (or periods) in which the effect of the chnge in the U.S. federl corporte income tx rte in the Tx Cuts nd Jobs Act is recognized. ssurnce 17 First Qurter 2018 Accounting, Reporting & Auditing Developments

18 Appendix B - Accounting Stndrds Affecting Public Business Entities in 2019 nd beyond Accounting Stndrds Updte Effective Dte Public Business Enterprises Trnsition Erly Adopt Summry This ASU mends the erly doption dte option for certin compnies relted to the doption of ASU nd ASU Both of the below entities my still dopt using the public compny doption guidnce in the relted ASUs, s mended. ASU Revenue Recognition (Topic 605), Revenue from Contrcts with Customers (Topic 606), Leses (Topic 840), nd Leses (Topic 842): Amendments to SEC Prgrphs Pursunt to the Stff Announcement t the July 20, 2017 EITF Meeting nd Rescission of Prior SEC Stff Announcements nd Observer Comments Effective with ASU nd ASU , both s mended Full or (ASU ) ( ) The SEC stff stted the SEC would not object to public business entity tht otherwise would not meet the definition of public business entity except for requirement to include or the inclusion of its finncil sttements or finncil informtion in nother entity s filing with the SEC dopting ASC Topic 606 for nnul reporting periods beginning fter December 15, 2018, nd interim reporting periods within nnul reporting periods beginning fter December 15, The SEC stff stted the SEC would not object to public business entity tht otherwise would not meet the definition of public business entity except for requirement to include or the inclusion of its finncil sttements or finncil informtion in nother entity s filing with the SEC dopting ASC Topic 842 for fiscl yers beginning fter December 15, 2019, nd interim periods within fiscl yers beginning fter December 15, ASU Derivtives nd Hedging (Topic 815): Trgeted Improvements to Accounting for Hedging Activities Fiscl yers beginning fter December 15, 2018, nd interim periods within those fiscl yers. 6 This ASU is intended to improve nd simplify ccounting rules round hedge ccounting nd lso help finncil sttement users better understnd n entity s risk exposures nd how hedging strtegies re used to mnge those exposures. The new stndrd refines nd expnds hedge ccounting for both finncil nd nonfinncil risk components nd ligns the recognition nd presenttion of the effects of the hedging instrument nd the hedged item in the finncil sttements. Its provisions crete more trnsprency round how economic results re presented, both on the fce of the finncil sttements nd in the footnotes, for investors nd nlysts. 6. For csh flow nd net investment hedges existing t the dte of doption, n entity should pply cumultive-effect djustment relted to eliminting the seprte mesurement of ineffectiveness to ccumulted other comprehensive income with corresponding djustment to the opening blnce of retined ernings s of the beginning of the fiscl yer tht n entity dopts the mendments in this Updte. The mended presenttion nd disclosure guidnce is required only prospectively. ssurnce 18 First Qurter 2018 Accounting, Reporting & Auditing Developments