Article

FASB Close to Finalizing Consolidation Standard

June 22, 2018

During a recent follow up to a May 16 discussion concerning its upcoming Accounting Standards Update, Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities, the Financial Accounting Standards Board (“FASB”) agreed on an effective date and transition requirements for private entities.

Per decisions made at its June 6 meeting, the FASB announced that private entities will have to apply the guidance in the standard for fiscal years starting after December 15, 2020. Early adoption will be allowed, and private entities must apply the guidance retrospectively with a cumulative-effect adjustment to retained earnings at the start of the earliest period given.

FASB staff members are still drafting the final standard for a vote.