Interpretive Guidance Updated for Revenue Recognition
New interpretive guidance is available regarding revenue recognition. On August 18, the Securities and Exchange Commission (“SEC”) issued Release No. 33-10402, Commission Guidance Regarding Revenue Recognition for Bill-and-Hold Arrangements, which advises public companies to abandon the guidance for bill-and-hold transactions under Accounting and Auditing Enforcement Release (“AAER”) No. 108, In the Matter of Stewart Parness, once they start applying Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 606, Revenue From Contracts With Customers. Until then, companies should continue using guidance under AAER No. 108. Another interpretive release issued was Release No. 33-10403, Updates to Commission Guidance Regarding Accounting for. Read More.
Topics: Accounting and Auditing Enforcement Release, Accounting Standards Codification, FASB, Financial Accounting Standards Board "FASB", Revenue Recognition, SEC, Securities and Exchange Commission "SEC", Staff Accounting Bulletin "SAB"
FASB Proposes Amendments to Financial Instruments and Leases
Last week, the Financial Accounting Standards Board (“FASB”) issued a proposed Accounting Standards Update (“ASU”), Technical Corrections and Improvements to Recently Issued Standards: I. Accounting Standards Update No. 2016-01, Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities and II. Accounting Standards Update No. 2016-02, Leases (Topic 842). The proposed changes address the following areas: Equity Securities without a Readily Determinable Fair Value—Discontinuation. The proposed amendment allows a company measuring an equity security using the measurement alternative to change to a fair value method in agreement with Topic 820, Fair Value Measurement. Equity Securities without a. Read More.
Topics: Equity Securities, Fair Value Measurement (Topic 820), FASB, Financial Accounting Standards Board "FASB", Financial Instruments—Overall (Subtopic 825-10), Forward Contracts, lease accounting, Proposed Accounting Standards Update, Purchased Options, Readily Determinable Fair Value
Lease Accounting Proposal to Help Companies with Land Easements
Utility and oil and gas companies could receive new guidance from the Financial Accounting Standards Board (“FASB”) to help account for land easements. In Proposed Accounting Standards Update (“ASU”) No. 2017-290, Leases (Topic 842): Land Easement Practical Expedient for Transition to Topic 842, the FASB gives companies with land easements what it calls a transition break. The transition break allows companies to forgo reviewing dated contract files to determine whether the transactions must be identified as leases and should be accounted for under ASU No. 2016-02, Leases (Topic 842). When the lease standard goes into effect, new easements must be reviewed. Read More.
PCC Members Want Consistency on Cloud Computing Guidance
With the Financial Accounting Standards Board (“FASB”) continuing to research ways to improve guidance for cloud computing accounting, private organizations and their accountants are pushing for a simplified approach. At a September 19 meeting, Private Company Council (“PCC”) representatives expressed to the FASB their desire for the accounting guidance for implementation costs related to setting up cloud-based business software packages to be consistent with the board’s guidance for similar software licenses. Beth van Bladel, a PCC member and director of CFO for Hire LLC, argued in favor of cloud computing being treated similarly as software licensing. van Bladel said she preferred that companies decide on how to organize the contractual agreement based on the terms and. Read More.
FASB Makes Updates to Technical Agenda
At its September 20 public meeting, the Financial Accounting Standards Board (“FASB”) agreed to add the following three projects to its technical agenda: A project on differentiating liabilities and equity, with a emphasis on indexation and settlement, convertible debt, disclosures, and earnings per share A section of the FASB’s Financial Performance Reporting Research project aimed at the disaggregation of performance reporting by function and nature A narrow-scoped project on segment reporting aimed at improving the aggregation criteria and segment disclosures The addition of these projects completes the last stage of the FASB’s agenda consultation project. Also at the meeting, the. Read More.
Topics: FASB, FASB Financial Instruments project, FASB Technical Agenda, Financial Accounting Standards Board "FASB", Intangible Assets, liabilities and equity, Other Postretirement Employee Benefit Plans
Bank Regulators Add Guidance for FASB Credit Loss Standard
Several bank regulators have updated their interpretive guidance regarding the Financial Accounting Standards Board’s (“FASB”) credit loss standard. The revised guidance from Federal Deposit Insurance Corporation, Federal Reserve, the National Credit Union Administration, and the Office of the Comptroller of the Currency will be added to the December 2016-published frequently asked questions document that explains why the FASB issued Accounting Standards Update No. No. 2016-13, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The new guidance addresses how to handle subjective information when banks estimate their loss reserves when applying ASU No. 2016-13. In. Read More.
Topics: Accounting Standards Update, Banking, FASB, FASB credit loss standard, Financial Accounting Standards Board "FASB", Financial Instruments - Credit Losses (Topic 326), National Credit Union Administration, SEC, Securities and Exchange Commission "SEC", U.S. GAAP