Amendment Proposed for Service Concession Arrangements
Businesses have asked for additional guidance on Topic 853, Service Concession Arrangements, and the Financial Accounting Standards Board (“FASB”) is answering the call. The FASB has issued Proposed Accounting Standards Update No. EITF-16C, Service Concession Arrangements (Topic 853) — Determining the Customer of the Operation Services: A Consensus of the FASB Emerging Issues Task Force, which includes a clarification to the customer’s identity in certain infrastructure deals between governmental entities and private-sector companies. The proposal calls for a government entity to be labeled the customer in transactions under Topic 853. Comments are due Friday, January 6.
Recap of FASB October 5 Meeting
At its October 5 meeting, the Financial Accounting Standards Board (“FASB”) ratified the September 22 consensus reached on the following Emerging Issues Task Force (“EITF”) Issue: Issue No. 16-A, “Restricted Cash” In addition, the FASB ratified the consensus-for-exposure on the following EITF Issue: Issue No. 16-C, “Determining the Customer of the Operation Services in a Service Concession Arrangement” Separately, the FASB reached decisions on Topic 718, Compensation–Stock Compensation. The FASB agreed that if a change to the stock compensation award does not impact the overall current fair value, vesting requirements or classification, then entities are not required to apply modification accounting under. Read More.
FASB Reviews Ongoing and Future Projects
Several projects received attention at the Financial Accounting Standards Board’s (“FASB”) August 31 meeting. Last week’s board meeting featured staff research updates on the following potential projects: Accounting for service concession arrangements Collaborative arrangements Scope of modification accounting in Topic 718, Compensation─Stock Compensation The FASB also redeliberated its proposed Accounting Standards Update, Technical Corrections and Improvements to Update No. 2014-09, Revenue from Contracts with Customers (Topic 606); discussed the revenue recognition of grants and contracts by nonprofits; and reached conclusions on the proposed guidance updates for long-duration contracts. More on the tentative board decisions from the August 31 meeting is available at FASB.org.