Emerging Accounting Issues (E) Working Group
March 29, 2008

No Tentative Positions were discussed during the 2008 Spring National Meeting.

The working group addressed the following Outstanding Issues:

• EITF 06-7: Issuer’s Accounting for a Previously Bifurcated Conversion Option in a Convertible Debt Instrument When the Conversion Option No Longer Meets the Bifurcation Criteria in FASB Statement No. 133 (EITF 06-7)

• Tentative – The Working Group exposed a tentative consensus rejecting EITF 06-7 as not applicable to statutory accounting

• EITF 06-8: Applicability of the Assessment of a Buyer’s Continuing Investment under FASB Statement No. 66 for Sales of Condominiums (EITF 06-8)

• Tentative – The Working Group exposed a tentative consensus to adopt the Issue 1 conclusion of EITF 06-8, with modification that continuing investment payments made in the form of buyer’s notes must be supported by letters of credit from institutions that are listed by the SVO. The Working Group also exposed a tentative consensus adopting the conclusion to Issue 2 of EITF 06-8 that in reassessment of collectibility of the sales price, the initial and continuing investment tests should be applied prospectively.

• EITF 06-9: Reporting a Change in (or the elimination of) a Previously Existing Difference between the fiscal Year-End of a Parent Company and That of a Consolidated Entity or between the Reporting Period of an Investor and That of an Equity Method Investee (EITF 06-9)

• Tentative – The Working Group exposed a tentative consensus to adopt the guidance included in EITF 06-9 that defines reporting period changes as a change in accounting principle, modified to apply only to equity method investments and replace references to GAAP literature to applicable SAP. In addition, the GAAP consolidation guidance was rejected.

• EITF 07-3: Accounting for Nonrefundable Advance Payments for Goods or Services Received for Use in Future Research and Development Activities (EITF 07-3)

• Tentative – The Working Group exposed a tentative consensus rejecting EITF 07-3 noting that nonrefundable advance payments for goods or services used or rendered for research and development activities should be expensed when the advance payment is made.

• EITF 02-11: Accounting for Reverse Spinoffs (EITF 02-11)

• Tentative – The Working Group exposed a tentative consensus adopting EITF 02-11, which indicates that accounting on the basis of legal form for spinoffs can be overcome in accordance with the substance of the transaction. In addition, the Working Group disbanded the APB 29 Subgroup, as all items referred have now been addressed.

• INT 07-05: EITF 06-10: Accounting for Deferred Compensation and Postretirement Benefit Aspects of Collateral Assignment Split-Dollar Life Insurance Arrangements (EITF 06-10)

• Referral – The Working Group referred this issue to the Statutory Accounting Principles Working Group for consideration, recommending that SSAP No. 21—Other Admitted Assets be modified to provide additional details on the elements to be considered in determining admissibility of assets related to ownership and control of life insurance arrangements.

• Balance Sheet Presentation of Funding Agreements issued to a Federal Home Loan Bank (FHLB)

• Defer – The Working Group deferred action on the item and requested Interested Parties to provide additional information as discussed during the meeting.

The deadline for submission of comments and for new items is April 30, 2008.