WIXLIB

Lessor disclosuresExtensive qualitative and quantitative disclosuresTypeExample disclosuresQualitative Quantitative Lease income (in tabular format) Maturity analysis of undiscounted cash flows(segregated by finance/operating lease) 2017 RSM US LLP. All Rights Reserved.Nature of leasesVariable payment arrangementsTermination/purchase/renewal optionsInformation about management of residual asset risk

Effective dateNonpublic businessentities Annual and interim periodsPublic business entitiesin fiscal years beginningafter 12/15/2018 Early adoption permitted Modified retrospectivetransition Certain reliefs Fiscal years beginningafter 12/15/2019 Interim periods in fiscalyears beginning after12/15/2020 Early adoption permitted Modified retrospectivetransition Certain reliefs 2017 RSM US LLP. All Rights Reserved.

Transition Modified retrospective transition Full retrospective adoption is prohibited All comparative periods presented are restated “Packaged” transition reliefs Expired/existing contracts contain leases Lease classification for expired/existing leases Whether previously capitalized initial direct costs could still becapitalized Other transition relief Hindsight can be used in determining lease term andassessing impairment of ROU assets 2017 RSM US LLP. All Rights Reserved.

Leases: Targeted improvements to ASC 842 Entities will be given an additional option for transition, under whichthey will be allowed to elect to recognize a cumulative-effectadjustment to the opening balance of retained in the period of adoption,rather than in the earliest period presented. Reporting for comparative periods would remain under ASC 840Separating Components of a Contract Lessors would be allowed to apply a practical expedient to not separatenonlease components from the related lease components Lessors applying this expedient would account for the combinedcomponents as a single lease component, if both:1. The timing and pattern of revenue recognition for the nonleasecomponent(s) and related lease component are the same2. The combined single lease component would be classified as anoperating leaseProposed ASU 2017 RSM US LLP. All Rights Reserved.ProposedTransition—Comparative Reporting at Adoption

Adoption Readiness Review of contracts Updates to clarify related party lease arrangements Updates to policies and internal controls System updates Controls related to adoption Interactions with auditors Assess quantitative impact prior to January 1,2019 First reporting period – January ’19 FOCUSreport 2017 RSM US LLP. All Rights Reserved.38

New Lease Accounting Resource Center Information about adoption andimplementation of ASU 2016-02,Leases (Topic 842), including: Leases: Bring on the balance sheet Leases: New accounting requirements forlessees Leases: Overview of the new guidance SAB 74 disclosures for new standard onlease accounting A contact form for those who needhelp implementing the new standard Additional resources on leaseaccountingvisit - rsmus.com/asc842 2017 RSM US LLP. All Rights Reserved.

DIGITAL CURRENCIES 2017 RSM US LLP. All Rights Reserved.

Accounting and Financial Reporting of Digital Currencies Currently no authoritative literatureunder US GAAP that specificallyaddresses resulting in diversity inpractice What is it? Cash? Financial Instrument? Intangible?Inventory? Security? Commodity? Something New? Why is it? ICOs? Trading? Liquid Asset? Economicsconsideration? 2017 RSM US LLP. All Rights Reserved.

Accounting and Financial Reporting of Digital Currencies Recognition and measurement Trade/execution date?Time of day? Close of business?Offsetting considerationsCarrying value (fair value vs. cost, subject to impairment?) Disclosure considerations If fair value, fair value hierarchy? Operating risks (keys stolen, lost, destroyed or otherwisecompromised) Market risks Liquidity risks Counterparty and credit risks – cryptocurrencyplatforms/exchanges 2017 RSM US LLP. All Rights Reserved.

What about SIPC Revenue? It is not clear whether revenues earned by abroker-dealer related to digital asset activities isincluded in SIPC revenue Is the digital asset a security? Does it matter? 2017 RSM US LLP. All Rights Reserved.

RESTRICTED CASH 2017 RSM US LLP. All Rights Reserved.

Restricted Cash ASU 2016-18, Statement of Cash Flows (Topic230): Restricted Cash Effective for public business entities for fiscal yearsending after December 15, 2017 Designed to reduce diversity in practice in cashflow presentations Entities must include restricted cash and cashequivalents in the reconciliation from beginning toend-of-period total cash amounts Entities must disclose the nature of restrictions onrestricted cash 2017 RSM US LLP. All Rights Reserved.45

Broker-Dealer Considerations ASU does not include a definition – covers “ amounts generally described as restricted cashor restricted cash equivalents” Broker-dealers would consider properpresentation of disclosure of cash segregatedunder SEC 15c3-3/PAB requirements andCFTC regulations Several broker-dealers adopted for Q1 201810-Q 2017 RSM US LLP. All Rights Reserved.46

INCOME TAXES(TCJA) 2017 RSM US LLP. All Rights Reserved.

Financial statement impacts of Tax Cuts and JobsAct On December 22, the Tax Cuts and Jobs Act (the “Act”) wassigned into legislation Most significant change in U.S. tax law since 1986 Significant financial statement impacts on a number ofareas as a result of the Act including: Deferred tax assets and liabilities Accumulated Other Comprehensive Income (AOCI) Net operating losses (NOLs) Alternative minimum tax Foreign operations 2017 RSM US LLP. All Rights Reserved.

The Act New law changes the discussion on tax impacts ofrevenue recognition New tax revenue recognition rules for entities withapplicable financial statements (AFS) Significant changes Revenue is fixed for tax when (1) the payment is earned throughperformance, (2) payment is due to the taxpayer, (3) payment isreceived by the taxpayer, or (4) the item of gross income, or anyportion thereof, is taken into account as revenue in the AFS,whichever happens earliest Tax will also follow the allocation of the transaction price Does not apply to special methods of accounting (e.g.,percentage-of-completion, installment sales) 2017 RSM US LLP. All Rights Reserved.

Deferred tax assets and liabilities under the Act ASC 740 requires that the effects of a change in tax lawand rates be accounted for in the period of enactment Deferred tax assets and liabilities are required to be adjustedto reflect the effect of a change in tax rates in the period ofenactment The Act reduces corporate tax rates from 35% to 21% fortax years beginning after 12/31/17 In financial statements for interim or annual periods after12/22/17, deferred tax assets and liabilities should bedetermined based on the new corporate tax rate in effectwhen they will reverse Changes to deferred taxes would be recorded in continuingoperations and would not be subject to the intraperiodallocations 2017 RSM US LLP. All Rights Reserved.

Non-calendar year-end public business entities Non-calendar year-end public entities must reflect thechanges under the Act in the quarter that includes12/22/17 Estimated annual effective tax rate for the current yearshould be adjusted in the quarter of enactment Estimated change in the deferred tax items as of thebeginning of the year should be treated as a discreteitem in the quarter of enactment Scheduling of deferred tax items may be needed todetermine the appropriate tax rate for reversal 2017 RSM US LLP. All Rights Reserved.

ASU 2018-02, Reclassification of Certain Tax Effects fromAccumulated Other Comprehensive Income Changes in rates for items included in AOCI go throughincome taxes from continuing operations This results in a disproportionate tax effect beingrecorded in AOCI (referred to as stranded tax effects) Historically this disproportionate impact would havebeen reversed based upon an accounting policy election The ASU allows for reclassification from AOCI toretained earnings for stranded tax effects resulting fromthe Tax Cuts and Jobs Act 2017 RSM US LLP. All Rights Reserved.

ASU 2018-02, Reclassification of Certain Tax Effects fromAccumulated Other Comprehensive IncomeIf elected, the effective date for calendar year-endsPermittedRequired2019 2017 RSM US LLP. All Rights Reserved.

NOLs under the Act NOLs arising in taxable years beginning after 12/31/17may only offset 80% of current year taxable income NOLs arising in taxable years ending after 12/31/17may not be carried back but can be carried forwardindefinitely The Act does not change the pre-2018 NOL usage,carryover or carryback periods These changes will affect a company’s assessment ofthe ability to utilize NOLs against deferred tax liabilities 2017 RSM US LLP. All Rights Reserved.

Corporate alternative minimum tax under the Act Corporate alternative minimum tax is repealed fortaxable years beginning after 12/31/17 Existing AMT credits will continue to be allowed tooffset regular tax liability after other credits Any AMT credits not used to reduce regular tax willbegin to be refunded starting in years beginning after2017 These changes will result in a release of a valuationallowance against any AMT credits 2017 RSM US LLP. All Rights Reserved.

Foreign operations under the Act U.S. companies will be required to include in U.S. taxable incomethe total amount of unremitted foreign earnings of its controlledforeign subsidiaries Effective for a foreign corporation’s final year beginning prior to 2018,which would include years ending 12/31/17As a result, the concept of permanent reinvestment in a foreignsubsidiary would no longer be relevant as it relates to potential U.S.tax on foreign earnings Tax due on deemed repatriation may be paid over an eight-yearperiod An entity that elects to pay the tax related to repatriation over eightyears will need to record a portion of the payable as a current liabilityand a portion as a non-current liabilityAmount should not be recorded as a deferred tax item as it representsan actual tax liability 2017 RSM US LLP. All Rights Reserved.

SEC guidance In late December, the SEC issued SAB 118 (codified in SAB Topic5.EE) which addresses the application of ASC 740 in the reportingperiod that includes the date on which the Act was signed into law While ASC 740 provides accounting and disclosure guidance onaccounting for income taxes, it does not address the treatmentwhen the accounting for certain income tax effects of the Act isincomplete at the time financial statements are issued SAB 118 provides that in cases in which the accounting for certainincome tax effects of the Act is incomplete but companies canmake a reasonable estimate of the effects of the tax law change,that estimate should be recorded with appropriate disclosures The estimate would be reported as a provisional amount in the company’sfinancial statements during the one-year measurement period Any adjustments during the measurement period should be included inincome from continuing operations as a tax expense/benefit in thereporting period the adjustments are determined 2017 RSM US LLP. All Rights Reserved.

SEC guidance (cont.) If a company does not have the necessary informationavailable, prepared, or analyzed regarding certainincome tax effects of the Act to determine a reasonableestimate to be included as provisional amounts: No related amounts should be included in an entity’sfinancial statements for those specific income tax effects forwhich a reasonable estimate cannot be determined A company should continue to apply ASC Topic 740 (e.g.,when recognizing and measuring current and deferredtaxes) based on the provisions of the tax laws in effectimmediately prior to the Act being enacted 2017 RSM US LLP. All Rights Reserved.

January 10th FASB meeting FASB issued a Q&A indicating that Private companies could follow the SAB 118 guidance Deemed repatriation payments and refundable AMTcredits should not be discounted 2017 RSM US LLP. All Rights Reserved.

Challenges? Since enacted date of Act is tax yearsbeginning after 12/31/17, taxacceleration for ASC 605/various otherGAAP guidance in 2017 (privatecompanies) Then additional potential change in2018/2019 as ASC 606 is fullyimplemented across all required entities IRS has not yet commented on how toeffect any of these changes 2017 RSM US LLP. All Rights Reserved.

BBA Audit RulesIRS – amended partnership audit rules for tax yearsbeginning in 2018 TEFRA partnership audit rules replaced by the“BBA audit rules” (Bipartisan Budget Act of 2015) IRS will generally collect tax at partnership levelon adjustments at the highest corporate orindividual rate Accounting for uncertain tax positions will becomemore complex 2017 RSM US LLP. All Rights Reserved.61

Tax reform resource centerAdditional information on how legislation can affect your business andtax planningvisit - rsmus.com/taxreform 2017 RSM US LLP. All Rights Reserved.

CURRENT EXPECTEDCREDIT LOSS (CECL) 2017 RSM US LLP. All Rights Reserved.

CECL: Not Just for Banks Consideration of accounting for variousreceivables Brokerage Margin loans Securities lending Reverse repurchase agreements Related party arrangements? Additional disclosure requirements 2017 RSM US LLP. All Rights Reserved.

Overview of the credit losses standard ASU 2016-13, Measurement of Credit Losses onFinancial Instruments Creates ASC Topic 326 Subtopic 326-20 applies to financial assets measured atamortized cost Supersedes impairment guidance in ASC 310 onreceivables/loans and ASC 320 on debt securities(amongst other changes) 2017 RSM US LLP. All Rights Reserved.

Effective dates of the credit losses standard SEC filers – fiscal years beginning after 12/15/19 (including interimperiods) – 2020 for calendar year-end entities (“CYE”) Public Business Entities that are not SEC filers – fiscal yearsbeginning after 12/15/20 (including interim periods) – 2021 for CYE All others – fiscal periods beginning after 12/15/20 (interim periodsbeginning after 12/15/21) – 2021 for CYE Early adoption is permitted for fiscal years beginning after 12/15/18– 2019 for CYE Adopt through a cumulative effect adjustment to retained earnings Special rules for other-than-temporary impairment (“OTTI”), purchasedfinancial assets with a more-than-insignificant amount of credit deteriorationsince origination (“PCD assets”) and beneficial interests 2017 RSM US LLP. All Rights Reserved.

Applicability of ASC 326-20 The following are in-scope: Financial assets measured at amortized cost (AC)including: Financing receivables (loans) Held to maturity debt securities Receivables from revenue transactions with customers andother income Reinsurance receivables Receivables related to repo and securities lending agreements Net investment in leases Off-balance-sheet credit exposures Loan commitments Standby letters of credit Financial guarantees/similar instruments 2017 RSM US LLP. All Rights Reserved.

Applicability of ASC 326-20 The following are out of scope: Financial assets measured at fair value (FV) Available-for-sale securities Other Loans made to participants by defined contributionemployee benefit plans Policy loans receivable of an insurance entity Promises to give (pledges receivable) of a not-forprofit entity Loans and receivables between entities undercommon control 2017 RSM US LLP. All Rights Reserved.

Major provisions of ASC 326-20 Recognize expected (rather than incurred) creditlosses Through allowance for recognized financial assets(including held-to-maturity ("HTM”) debt securities) Through liability for off balance sheet exposures Results in day 1 life of asset expected loss recognition Exception: Initial allowance recorded as increase to purchaseprice for PCD assets (Assets that as of the date of acquisitionhave experienced a more-than-insignificant deterioration incredit quality since origination – “Purchased with creditdeterioration”) Changes in the allowance (plus and minus) are recordedimmediately through credit loss expense 2017 RSM US LLP. All Rights Reserved.

Major provisions of ASC 326-20 Measure expected losses on a pool basiswhenever similar risk characteristics exist No one method required. Some examples: Discounted cash flows Loss rate methods Roll-rate methods Probability of default methods Based on an aging analysis 2017 RSM US LLP. All Rights Reserved.

Major provisions of ASC 326-20 Consider relevant available information (internaland/or external) when estimating expectedlosses Don’t rely solely on past events – Adjusthistorical loss information for Differences in current asset specific riskcharacteristics Circumstances when historical info is not reflective ofcontractual term Current conditions Reasonable and supportable forecasts 2017 RSM US LLP. All Rights Reserved.

Major provisions of ASC 326-20 When estimating losses for periods beyondreasonable and supportable forecast, revert tohistorical loss information Input level or based on the entire estimate Immediately, straight line basis or another rationaland systematic basis Include measure of expected risk of loss even ifremote May reach conclusion expected credit loss is zero ifjustified based on historical loss info adjusted forcurrent conditions and reasonable and supportableforecasts 2017 RSM US LLP. All Rights Reserved.

Major provisions of ASC 326-20 Collateral dependent practical expedient (PE)available when: Borrower is experiencing financial difficulty Repayment is expected substantially through theoperation or sale of the collateral Base estimate of credit loss on a

Broker-Dealer Revenue Streams Revenue Stream Status of Paper Commission Income Finalized and included in the AIPCA Guide Revenue Recognition Commission Income -Trade Date vs Settlement Date Finalized and included in the AIPCA Guide Revenue Recognition Selling and Distribution Fee Revenue Comment Period Closed -Final Version Outstanding