FASB Working to Update Definitions for Revenues and Expenses
Efforts have begun to update several financial statement definitions in the Financial Accounting Standards Board’s (“FASB”) Conceptual Framework, a guide used to help the board establish consistent accounting standards. In particular, the FASB is working to revise the definitions for revenues and expenses, as both terms use similar language in their descriptions under Statements of Financial Accounting Concepts No. 6, Elements of Financial Statements: a Replacement of FASB Concepts Statement No. 3 — Incorporating an Amendment of FASB Concepts Statement No. 2. The FASB will look into defining revenues as either inflows or other improvements to assets of a company,. Read More.
Employee Benefit Plans Excluded from Disclosure Framework
As the Financial Accounting Standards Board (“FASB”) moves forward with finalizing its disclosure framework, the board has decided to exclude employee benefit plans from the guidance. Agreed upon at its October 4 meeting, the FASB said confirmed that employee benefit plans will not be evaluated similarly as other entities when the board decides whether they are required to disclose certain information. The decision was based on the FASB’s belief that an employee benefit plan’s financial statements and its users are significantly different from organizations to allow for possibly different reporting considerations. While most FASB members agreed with this sentiment, Christine. Read More.
FASB Still Working to Address Disclosure Overload in Financial Statement Footnotes
Since 2014, the Financial Accounting Standards Board (“FASB”) has been working to simplify U.S. GAAP disclosure requirements for financial statement footnotes. The project, which was released under Proposed Statement of Financial Accounting Concepts No. 2014-200, Conceptual Framework for Financial Reporting—Chapter 8: Notes to Financial Statements, aimed to avoid writing rules that would lengthen a company’s financial statements without benefiting investors. Despite its efforts, the FASB has received frequent complaints from companies who were frustrated over the various disclosure requirements. Board representatives are also concerned about what they consider disclosure overload. They believed investors were becoming overwhelmed with additional information that. Read More.
Topics: Conceptual Framework Project, Disclosure Requirements, FASB, Financial Accounting Standards Board "FASB", Financial Statement Disclosures, Proposed Statement of Financial Accounting Concepts, U.S. GAAP
FASB Makes Decisions on Conceptual Framework and Codification Projects
At its August 30 board meeting, the Financial Accounting Standards Board (“FASB”) reached decisions on two ongoing projects. The first project covered was the conceptual framework project, in which the FASB agreed to remove the terms “probable”, “future economic benefits”, “sacrifices of economic benefits”, and “past transactions or events” from its revised definitions of an asset and a liability. Staff members were ordered to continue reviewing whether “control” is needed in the FASB’s definition of an asset. The FASB then discussed its project to improve the Accounting Standards Codification (“Codification”). Talks involved a staff analysis of the proposed changes and. Read More.
FASB Staff Discusses Conceptual Framework
In a nearly four-minute video, staff members of the Financial Accounting Standards Board (“FASB”) discuss the board’s Conceptual Framework project. Project Managers Jill Switter and Nick Cappiello offer background details on the project, while other FASB members discuss the cost benefits of conceptual framework, how the board uses it and what is coming next. Visit FASB.org to watch the Conceptual Framework project video .
FASB Discusses Proposed Callable Debt Securities Standard
After reviewing feedback from its proposed Accounting Standards Update, Receivables—Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities, the Financial Accounting Standards Board (“FASB”) has made tentative decisions on the following: Requests to Require a True “Yield-to-Worst” Amortization Method. Premiums on purchased callable debt securities will be amortized to the earliest call date. Requests to Clarify Consequential Amendments to Paragraph 946-320-35-20. The amendment to industry guidance was corrected to affirm that the FASB did not intend to change practice for investment companies holding debt securities. Requests to Clarify “Callable” and the Interaction with Paragraph 310-20-35-26.. Read More.
Topics: Agenda Consultation, Amortization, callable debt securities, Conceptual Framework Project, FASB, Financial Accounting Standards Board "FASB", Proposed Accounting Standards Update, Receivables—Nonrefundable Fees and Other Costs (Subtopic 310-20)