text: SECTION 1. SHORT TITLE.
  
      This Act may be cited as the ``Financial Accounting for Intangibles 
  Reexamination (FAIR) Act''.
  
  SEC. 2. SENSE OF CONGRESS.
  
      It is the sense of the Congress that, prior to changing existing 
  rules of accounting for business combinations and intangible assets, 
  the Securities and Exchange Commission and the Financial Accounting 
  Standards Board should undertake a comprehensive reexamination of the 
  appropriate methods of accounting for purchased and internally 
  generated intangibles including goodwill, and should await the results 
  of related studies of these issues.
  
  SEC. 3. MORATORIUM ON ELIMINATION OF POOLING OF INTERESTS METHOD OF 
                ACCOUNTING.
  
      (a) Continued Validity of Method.--Notwithstanding any other 
  provision of law, for purposes of any financial statement, report, or 
  other document required under any of the securities laws, the 
  availability and use of the pooling of interests method of accounting 
  for any business combination shall be determined in accordance with 
  generally accepted accounting principles as in effect on October 1, 
  2000 .
      (b) Duration of Moratorium.--This section shall take effect upon 
  the date of the enactment of this Act and shall remain in effect until 
  90 days after the date of the submission of the report required by 
  section 4(e).
  
  SEC. 4. FURTHER STUDY.
  
      (a) Establishment.--There is established a commission to be known 
  as the Commission on Financial Accounting for Intangibles (referred to 
  in this section as the ``Commission'').
      (b) Duties.--The Commission shall--
              (1) consider the general usefulness of financial statements 
          prepared under generally accepted accounting principles in 
          light of recent trends in the securities markets;
              (2) consider the impact that shortcomings in generally 
          accepted accounting principles have on securities market 
          volatility, capital allocation, and the investment of 
          retirement fund assets, both individual and institutional;
              (3) consider methods to better identify, value, and account 
          for purchased and internally generated intangible assets;
              (4) examine the general questions surrounding the role of 
          intangible assets in financial reporting in the economy; and
              (5) consider the economic impact that would result if the 
          pooling of interests method of accounting for business 
          combinations were eliminated.
      (c) Membership.--
              (1) Number and appointment.--
                      (A) The Commission shall be composed of 10 
                  individuals, of which--
                              (i) 3 shall be appointed by the majority 
                          leader of the Senate;
                              (ii) 2 shall be appointed by the minority 
                          leader of the Senate;
                              (iii) 3 shall be appointed by the Speaker 
                          of the House of Representatives; and
                              (iv) 2 shall be appointed by the minority 
                          leader of the House of Representatives.
                      (B) From the 10 commissioners appointed, a chairman 
                  shall be selected jointly by the majority leader of the 
                  Senate and the Speaker of the House of Representatives.
              (2) Qualifications for membership.--
                      (A) Of the members appointed under paragraph 
                  (1)(A), 4 shall come from the accounting profession.
                      (B) The remainder of such members shall be experts 
                  capable of carrying out the duties described in this 
                  section.
              (3) Deadline for appointment.--All members of the 
          Commission shall be appointed by no later than December 31, 
          2000.
              (4) Terms of appointment.--The term of an appointment to 
          the Commission shall be for the life of the Commission.
              (5) Vacancy.--
                      (A) A vacancy on the Commission shall be filled, 
                  not more than 30 days after notice of the vacancy is 
                  given to the Commission, in the same manner in which 
                  the original members were selected.
                      (B) A vacancy shall not affect the power of the 
                  remaining members to execute the duties of the 
                  Commission.
      (d) Procedure.--
              (1) Meetings.--The Commission shall meet at the call of its 
          chairman or a majority of its members.
              (2) Quorum.--A quorum shall consist of 7 members of the 
          Commission.
      (e) Report.--Not later than 9 months after the date of the 
  enactment of this Act, the Commission shall submit a report to the 
  President and Congress which shall contain a detailed statement of the 
  Commission's recommendations, findings, and conclusions, and may 
  contain minority or individual member's views.
      (f) Termination.--The Commission shall terminate not more than 30 
  days after the date of submission of the report required in subsection 
  (e).
  
  SEC. 5. DEFINITIONS.
  
      For purposes of this Act:
              (1) Pooling of interests.--The term ``pooling of 
          interests'' refers to the method of accounting for business 
          combinations described in the Federal Accounting Standards 
          Board's APB Opinion Number 16, Business Combinations, as in 
          effect on October 1, 2000.
              (2) Securities laws.--The term ``securities laws'' has the 
          meaning given such term in section 3(a)(47) of the Securities 
          Exchange Act of 1934 (15 U.S.C. 78c(a)(47)).
target: States that the availability and use of the pooling of interests method of accounting for any business combination shall be determined in accordance with generally accepted accounting principles in effect on October 1, 2000.
  Establishes the Commission on Financial Accounting for Intangibles to consider specified aspects of: (1) generally accepted accounting principles; (2) intangible assets; and (3) the pooling of interests method of accounting for business combinations.
  Instructs the Commission to report its recommendations and conclusions to the President and Congress.
feat_title: Financial Accounting for Intangibles Reexamination (FAIR) Act