Other FASB

Summary - As reported in its “Summary of Decisions” publication, the FASB met on April 9, 2025, and discussed feedback on the proposed Accounting Standards Update, Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606): Derivatives Scope Refinements and Scope Clarification for a Share-Based Payment from a Customer in a Revenue Contract.

For more information, click here.

Hedge Accounting – FASB Discusses Hedge Accounting Improvements

Summary - As reported in its “Summary of Decisions” publication, the FASB met on March 26, 2025, and discussed feedback received on the proposed Accounting Standards Update, Derivatives and Hedging (Topic 815): Hedge Accounting Improvements.

For more information, click here.

VIEs – FASB Discusses Determining the Acquirer in the Acquisition of a VIE

Summary - As reported in its “Summary of Decisions” publication, the FASB met on March 5, 2025, and discussed feedback received on the proposed Accounting Standards Update, Business Combinations (Topic 805) and Consolidation (Topic 810): Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity.

For more information, click here.

Work of Specialists – PCAOB Issues Spotlight on Using the Work of Specialists

Summary - As discussed above, the PCAOB released a new staff Spotlight report, Considerations for Audit Firms Using the Work of Specialists. There has been a rise in the frequency and significance of the use of the work of specialists in financial reporting and auditing. Specialists are more frequently used by companies and auditors because estimates have become more prevalent and significant, particularly estimates of fair value.

The Spotlight highlights recent PCAOB staff observations designed to help audit firms ensure appropriate procedures are performed when using the work of a specialists. Topics covered include:

Evaluating the work of a company specialist;
Using the work of auditor-employed and auditor-engaged specialists;
Common deficiencies related to use of specialists;
Reminders and good practices for audit firms; and
Questions of interest to audit committees about work performed by the audit firm related to the use of specialists.

For more information, click here.

Debt Exchanges – FASB Discusses the Accounting for Debt Exchanges

Summary - As reported in its “Summary of Decisions” publication, the FASB met on November 20, 2024, and added a project to its technical agenda to address when a transaction with multiple creditors that involves the contemporaneous exchange of cash between the same debtor and creditor in connection with the issuance of a new debt obligation and satisfaction of an existing debt obligation by the debtor (a “debt exchange transaction”) should be accounted for as a debt extinguishment and the issuance of new debt.

For more information, click here.

Income Statement Expenses – FASB Discusses Disaggregation of Income Statement Expenses

Summary - As reported in its “Summary of Decisions” publication, the FASB met on December 18, 2024, and discussedfeedback received on proposed ASU, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date.

For more information, click here.

Derivatives – FASB Discusses Derivatives Scope Refinements

Summary - As reported in its “Summary of Decisions” publication, the FASB met on January 15, 2025, and discussed the comment letter feedback on the proposed Accounting Standards Update (ASU), Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606): Derivatives Scope Refinements and Scope Clarification for a Share-Based Payment from a Customer in a Revenue Contract, and began redeliberations.

For more information, click here.

Financial Performance Indicators – FASB Publishes Invitation to Comment on Financial Performance Indicators

Summary - The FASB has published an Invitation to Comment (ITC), Financial Key Performance Indicators for Business Entities. The ITC gives stakeholders the opportunity to provide feedback on financial key performance indicators (KPIs). Stakeholders are encouraged to review and provide comment on the ITC by April 30, 2025.

For the purposes of the ITC, a Financial KPI is a financial measure that is calculated or derived from the financial statements and/or underlying accounting records that is not presented in the GAAP financial statements. This includes measures derived from amounts presented in the financial statements, measures derived from adjusting amounts presented in the financial statements, and measures derived from or calculations based on other information included in the financial statements or other financial records. Examples of Financial KPIs include earnings before interest, taxes, depreciation, and amortization (EBITDA); free cash flow (FCF); organic sales growth; and adjusted net income.

This ITC is being issued as part of the FASB’s research project on financial key performance indicators for business entities. Responses to the questions in this ITC will help inform the FASB as it considers whether to add a project on Financial KPIs to its technical agenda and, if added, to determine the objective and scope of the project.

The FASB staff is issuing this ITC to solicit additional feedback on potential standard setting for Financial KPIs, including the following:

Should Financial KPIs be standardized and, if so, which ones?
Should Financial KPIs be required or permitted to be disclosed in an entity’s GAAP financial statements and, if so, when and for what types of entities?

For more information, click here.

FASB Comment Periods – FASB Discusses Extending the Comment Period on Several Projects

Summary - As reported in its “Summary of Decisions” publication, the FASB met on November 6, 2024, and discussed extending the comment period for proposed Accounting Standards Updates issued on the following projects:

Interim reporting
Accounting for government grants; and
Accounting for environmental credit programs.

For more information, click here.

Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures

Summary - The ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted.

A public entity should apply the amendments retrospectively to all prior periods presented in the financial statements. Upon transition, the segment expense categories and amounts disclosed in the prior periods should be based on the significant segment expense categories identified and disclosed in the period of adoption.

The amendments apply to all public entities that are required to report segment information in accordance with Topic 280, Segment Reporting.

The amendment in the ASU is intended to improve reportable segment disclosure requirements primarily through enhanced disclosures about significant segment expenses. The key amendments:

Require that a public entity disclose, on an annual and interim basis, significant segment expenses that are regularly provided to the chief operating decision maker (CODM) and included within each reported measure of segment profit or loss.
Require that a public entity disclose, on an annual and interim basis, an amount for other segment items by reportable segment and a description of its composition. The other segment items category is the difference between segment revenue less the significant expenses disclosed and each reported measure of segment profit or loss.
Require that a public entity provide all annual disclosures about a reportable segment’s profit or loss and assets currently required by FASB Accounting Standards Codification® Topic 280, Segment Reporting, in interim periods
Clarify that if the CODM uses more than one measure of a segment’s profit or loss in assessing segment performance and deciding how to allocate resources, a public entity may report one or more of those additional measures of segment profit. However, at least one of the reported segment profit or loss measures (or the single reported measure, if only one is disclosed) should be the measure that is most consistent with the measurement principles used in measuring the corresponding amounts in the public entity’s consolidated financial statements.
Require that a public entity disclose the title and position of the CODM and an explanation of how the CODM uses the reported measure(s) of segment profit or loss in assessing segment performance and deciding how to allocate resources.
Require that a public entity that has a single reportable segment provide all the disclosures required by the amendments in the ASU and all existing segment disclosures in Topic 280.

For more information, click here.

Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses

Summary - This ASU is effective for public business entities for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted.

A public business entity should apply ASU No. 2024-03 prospectively to financial statements issued for reporting periods beginning after the effective date of ASU No. 2024-03. The disclosures required ASU No. 2024-03 do not need to be included in financial statements for reporting periods beginning before the effective date that are being presented for comparative purposes with financial statements issued for periods after the effective date.

A public business entity may elect to apply ASU No. 2024-03 retrospectively to any or all prior periods presented in the financial statements. If applied to financial statements for periods beginning before the effective date, those disclosures should be prepared and presented in accordance with this Subtopic.

This ASU requires public companies to disclose, in the notes to financial statements, specified information about certain costs and expenses at each interim and annual reporting period. Specifically, they will be required to:

Disclose the amounts of (a) purchases of inventory; (b) employee compensation; (c) depreciation; (d) intangible asset amortization; and (e) depreciation, depletion, and amortization recognized as part of oil- and gas-producing activities (or other amounts of depletion expense) included in each relevant expense caption.
Include certain amounts that are already required to be disclosed under current generally accepted accounting principles (GAAP) in the same disclosure as the other disaggregation requirements.
Disclose a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively.
Disclose the total amount of selling expenses and, in annual reporting periods, an entity’s definition of selling expenses.

For more information, click here.

FASB Discusses Disaggregation of Income Statement Expenses

Summary - As reported in its “Summary of Decisions” publication, the FASB met on June 26, 2024, and completed redeliberations on the proposed Accounting Standards Update (ASU), Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses.

For more information, click here.

FASB Discusses Induced Conversions of Convertible Debt Instruments

Summary - As reported in its “Summary of Decisions” publication, the FASB met on July 17, 2024, and discussed feedback received on the proposed ASU, Debt—Debt with Conversion and Other Options (Subtopic 470-20): Induced Conversions of Convertible Debt Instruments.

For more information, click here.

Income Statement Expenses –FASB Discusses Disaggregation of Income Statement Expenses

Summary - The AICPA has issued new TQAs under Section 320, Breach of an Independence Interpretation. TQAs include nonauthoritative guidance in question and answer format provided by the AICPA on various topics.

The AICPA has added the following guidance under TQA section 320, Breach of an Independence Interpretation, with the following questions and answers:

TQA section 320.01, “Communication of an Independence Breach to Affiliates of an Attest Client That Are Also Attest Clients;”
TQA section 320.02, “Communication to Affiliates That Are Not Affected by an Independence Breach at an Attest Client;”
TQA section 320.03, “Communication and Confidentiality After an Independence Breach,” and
TQA section 320.04, “Manner of Communication After an Independence Breach.”

For more information, click here.

FASB Agenda –FASB Discusses Potential Agenda Projects

Summary - As reported in its “Summary of Decisions” publication, the FASB met on December 20, 2023, and discussed the results of staff research and analysis on several potential projects related to recent agenda requests. The FASB decided not to add the following potential projects to its agenda:

Clarifying the Scope and Application of Topic 480, Distinguishing Liabilities from Equity, for Legal Form Debt Instruments;
Accounting for Equity Securities;
Eliminating the Held-to-Maturity (HTM) Classification for Debt Securities;
Making Other Amendments to the Accounting for HTM Debt Securities; and
Topic 740, Income Taxes, Backwards Tracing.

The FASB also decided not to add a project to its technical agenda on accounting for commodities at this time but supported retaining the project on the research agenda.

For more information, click here.

Interim Reporting –FASB Discusses Interim Reporting

Summary - As reported in its “Summary of Decisions” publication, the FASB met on November 15, 2023, and continued redeliberations on the 2021 proposed ASU, Interim Reporting (Topic 270): Disclosure Framework—Changes to Interim Disclosure Requirements. The FASB reached a number of decisions, including agreeing with the FASB staff’s methodology for identifying interim disclosure requirements. Key aspects of the methodology include whether the word interim is used in the existing disclosure as well as consideration of references within current GAAP (including Topic 270) and source literature.

For more information, click here.

Software Costs –FASB Discusses Accounting and Disclosure for Software Costs

Summary - As reported in its “Summary of Decisions” publication, the FASB met on September 20, 2023, and discussed recent feedback received from a wide variety of stakeholders on the recognition of software costs.

For more information, click here.

Hedge Accounting Improvements –FASB Discusses Hedge Accounting Improvements

Summary - As reported in its “Summary of Decisions” publication, the FASB met on October 11, 2023, and discussed comment letter feedback on proposed amendments related to two issues included in the 2019 proposed ASU, Derivatives and Hedging (Topic 815): Codification Improvements to Hedge Accounting—Dual Hedging Relationships and Use of the Term Prepayable in the Shortcut Method. The FASB also discussed a third issue that arose as a result of the cessation of LIBOR—Net Written Options as Hedging Instruments.

For more information, click here.

FASB Accounting Standards Updates - Accounting Standards Update No. 2023-06 — Disclosure Improvements — Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative

Summary - The FASB has issued Accounting Standards Update (ASU) No. 2023-06, Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative, that incorporates certain U.S. Securities and Exchange Commission (SEC) disclosure requirements into the FASB Accounting Standards Codification™. The amendments in the ASU are expected to clarify or improve disclosure and presentation requirements of a variety of Codification Topics, allow users to more easily compare entities subject to the SEC’s existing disclosures with those entities that were not previously subject to the requirements, and align the requirements in the Codification with the SEC’s regulations.

In SEC Release No. 33-10532, Disclosure Update and Simplification, issued August 17, 2018, the SEC referred certain of its disclosure requirements that overlap with, but require incremental information to, generally accepted accounting principles to the FASB for potential incorporation into the Codification.

The ASU incorporates into the Codification 14 of the 27 disclosures referred by the SEC. They modify the disclosure or presentation requirements of a variety of Topics in the Codification. The requirements are relatively narrow in nature. Some of the amendments represent clarifications to, or technical corrections of, the current requirements. Because of the variety of Topics amended, a broad range of entities may be affected by one or more of those amendments.

For entities subject to the SEC’s existing disclosure requirements and for entities required to file or furnish financial statements with or to the SEC in preparation for the sale of or for purposes of issuing securities that are not subject to contractual restrictions on transfer, the effective date for each amendment will be the date on which the SEC removes that related disclosure from its rules. For all other entities, the amendments will be effective two years later. However, if by June 30, 2027, the SEC has not removed the related disclosure from its regulations, the amendments will be removed from the Codification and not become effective for any entity.

For more information, click here.

Crypto Assets –FASB Discusses Accounting for Crypto Assets

Summary - As discussed in its “Summary of Decisions” publication, the FASB met on September 6, 2023. The FASB discussed comment letter feedback and issues for redeliberations on the proposed ASU, Intangibles: Goodwill and Other: Crypto Assets (Subtopic 350-60): Accounting for and Disclosure of Crypto Assets.

For more information, click here.

Income Tax –FASB Discusses Improvements to Income Tax Disclosures

Summary - As discussed in its “Summary of Decisions” publication, the FASB met on August 30, 2023. The FASB discussed feedback received and issues for redeliberation on the proposed ASU, Income Taxes (Topic 740): Improvements to Income Tax Disclosures.

For more information, click here.

Segment Reporting – FASB Discusses Segment Reporting

Summary - As reported in its “Summary of Decisions,” the FASB met on July 26, 2023, and discussed comment letter feedback and issues for redeliberations on the proposed Accounting Standards Update, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures.

For more information, click here.

FASB Agenda – FASB Discusses Agenda Prioritization

Summary - As reported in its “Summary of Decisions” publication, the FASB met on April 26, 2023, and discussed the Agenda Request on addressing whether certain convertible debt instruments settled using terms that differ from the stated contractual conversion provisions should be accounted for as induced conversion or extinguishment.

The FASB decided to add a project to the Emerging Issues Task Force (EITF) agenda to improve the relevance of the existing induced conversion guidance in Subtopic 470-20. The project scope will focus on the applicability of the induced conversion guidance to the early settlement of convertible debt instruments.

For more information, click here.

Disclosure Improvements –FASB Discusses Proposed ASU on Disclosure Improvements

Summary - As reported in Summary of Decisions, the FASB met on May 17, 2023 and redeliberated the proposed Accounting Standards Update (ASU), Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative. The FASB affirmed a number of decisions on disclosures related to various accounting topics, including changes in reporting entity, earnings per share, and assets subject to liens. These decisions are detailed in the summary.

For more information, click here.

Income Statement Expenses – FASB Discusses Disaggregation of Income Statement Expenses

Summary - As reported in its “Summary of Decisions” publication, the FASB met on January 11, 2023, and continued its initial deliberations by discussing what information entities would be required to provide when disaggregating income statement expenses.

The FASB decided to require that entities disclose:

Costs incurred that are expensed as incurred; and
Costs incurred that are capitalized as inventory (and subject to subsequent measurement requirements in Topic 330, Inventory).

The FASB also decided to require that entities disclose the amounts of: (1) employee compensation; (2) depreciation of property, plant, and equipment; (3) amortization of intangible assets; and (4) inventory expense included in each relevant expense line item in the income statement. The FASB indicated that it will discuss at a future meeting whether other types of depreciation, amortization, or depletion other than depreciation of property, plant, and equipment and amortization of intangible assets should be disclosed.

For more information, click here.

Software Costs –FASB Discusses Accounting and Disclosure of Software Costs

Summary - As reported in its “Summary of Decisions” publication, the FASB met on January 18, 2023, and discussed the recent feedback received from a wide variety of stakeholders on various models. The FASB directed its staff to further research the initial development cost model, including ways to increase the operability and consistency of the application of that model.

The initial development cost model would require that all direct software development costs and software enhancement costs be capitalized from the point at which it is probable that the software will be:

Completed; and
Used to perform the function intended.

Software development costs incurred after the software is substantially complete and ready for its intended use and ongoing maintenance costs would be expensed as incurred.

For more information, click here.

Crypto Assets –FASB Discusses the Accounting for Crypto Assets

Summary - As reported in its “Summary of Decisions” publication, the FASB met on February 1, 2023 and discussed clarifications to the scope, transition, costs and benefits of the decisions reached, and the comment period.

The FASB decided to clarify that the scope of this project would exclude crypto assets created or issued by the reporting entity or their related parties. The FASB also observed that the scope criteria would exclude assets commonly referred to as “wrapped tokens” and that the FASB’s basis for conclusions should clearly emphasize that point. The FASB decided to not modify the scope criteria to specify that the distributed ledger or blockchain must be public.

The FASB decided that early adoption should be permitted and that a cumulative-effect adjustment to retained earnings (or other appropriate components of equity or net assets in the statement of financial position) would be recognized as of the beginning of the first annual period in which the guidance is adopted. The FASB decided that all entities, including nonpublic entities, should be subject to the same effective date and transition requirements. The FASB is expected to further consider this in establishing the effective date in the issuance of a final Accounting Standards Update (ASU).

The FASB concluded that it has received sufficient information and analysis to make an informed decision on the expected costs of the proposed amendments and that the expected benefits of those amendments would justify the expected costs.

The FASB directed the staff to draft a proposed ASU for vote by written ballot. Additionally, the FASB decided to expose the proposed ASU for public comment for 75 days.

For more information, click here.

FASB Accounting Standards Updates - Accounting Standards Update No. 2022-06 — Reference Rate Reform (Topic 848) — Deferral of the Sunset Date of Topic 848

Summary - The FASB issued ASU No. 2022-06, Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848, that extends the period of time preparers can utilize the reference rate reform relief guidance. The amendments in ASU No. 2022-06 are effective for all entities upon issuance.

In 2020, the FASB issued Accounting Standards Update No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides optional guidance to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting.

The objective of the guidance in Topic 848 is to provide relief during the temporary transition period, so the FASB included a sunset provision within Topic 848 based on expectations of when the London Interbank Offered Rate (LIBOR) would cease being published. In 2021, the UK Financial Conduct Authority (FCA) delayed the intended cessation date of certain tenors of USD LIBOR to June 30, 2023.

To ensure the relief in Topic 848 covers the period of time during which a significant number of modifications may take place, the ASU defers the sunset date of Topic 848 from December 31, 2022, to December 31, 2024, after which entities will no longer be permitted to apply the relief in Topic 848.

For more information, click here.

Crypto Assets –FASB Discusses the Accounting and Disclosure of Crypto Assets

Summary - As reported in its “Summary of Decisions” publication, the FASB met on December 14, 2022, and discussed how entities that hold crypto assets within the scope of this project should present and disclose crypto assets in the financial statements.

The FASB decided to require an entity to:

At a minimum, present the aggregate amount of crypto assets (within the scope of this project) separately from other intangible assets that are measured using other measurement bases;
Present gains and losses on crypto assets (within the scope of this project) in net income and present those gains and losses separately from the income statement effects of other intangible assets, such as amortization or impairments; and
Classify crypto assets received as noncash consideration during the ordinary course of business that are converted nearly immediately into cash as operating cash flows.

For more information, click here.

Issue Summary Packages for the 12/1/22 EITF Meeting

Summary - The FASB has issued meeting materials for the December 1, 2022 EITF meeting. The materials include:

Proposed agenda; and
Issue Summary No. 2 for EITF Issue No. 21-A, Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method.

For more information, click here.

Proposed Statement of Financial Accounting Concepts —Concepts Statement 8 —Conceptual Framework for Financial Reporting — Chapter 5: Recognition and Derecognition

Summary - The FASB has issued a proposed new chapter of its Conceptual Framework related to the recognition and derecognition of an item in financial statements. The Conceptual Framework is a body of interrelated objectives and fundamentals that provides the FASB with a useful tool as it sets standards. A Statement of Financial Accounting Concepts is nonauthoritative and does not establish or change generally accepted accounting principles. The FASB has requested that stakeholders provide feedback the proposed chapter by February 21, 2023.

The proposed chapter would become Chapter 5: Recognition and Derecognition, of FASB Concepts Statement No. 8, Conceptual Framework for Financial Reporting. The new chapter would be similar to the rest of the framework in that it establishes concepts that the FASB would use in developing standards of financial accounting and reporting. It would provide the FASB with a framework for developing standards that meet the objective of financial reporting and enhance the understandability of information for existing and potential investors, lenders, donors, and other resource providers of a reporting entity.

The proposed chapter provides recognition and derecognition criteria and guidance on when an item should be incorporated into and removed from financial statements. Stakeholders are asked to provide input on three proposed recognition criteria an item should meet to be recognized in financial statements, subject to the pervasive cost constraint and materiality considerations. Those proposed criteria are:

Definitions—The item meets the definition of an element of financial statements.
Measurability—The item is measurable and has a relevant measurement attribute.
Faithful Representation—The item can be depicted and measured with faithful representation.
The FASB also seeks stakeholder input on whether derecognition, the process of removing an item from financial statements of a reporting entity as an asset, liability, or equity, should occur when an item no longer meets any one of the recognition criteria.

For more information, click here.

Income Statement –FASB Discusses Disaggregation of Income Statement Expenses

Summary - As reported in its “Summary of Decisions” publication, the FASB met on October 5, 2022, and continued its initial deliberations by discussing the disaggregation approach for income statement expenses. The FASB decided to pursue an expense disaggregation approach whereby an entity would be required to reconcile any disaggregated information to the relevant expense caption presented in the income statement. The FASB decided not to require disclosure in total for any additional specific expenses or costs incurred.

The FASB also decided to refine the project scope to include any relevant expense line items. That means that the project’s scope applies to any expense line items on the income statement that contain certain types of underlying information. Those expense captions would be required to be disaggregated, depending on the types of underlying expenses the Board later decides to require. Additionally, the FASB directed its staff to focus its research on all business entities.

For more information, click here.

Joint Ventures – FASB Discusses Joint Venture Formations

Summary - As reported in its “Summary of Decisions” publication, the FASB met on September 14, 2022, and discussed deliberated sweep issues related to its project on joint venture formations.

Decisions made during this meeting, included the following:

Define formation date in the Master Glossary as the date on which an entity initially meets the definition of a joint venture.
Require that a joint venture recognize any negative goodwill (the net identifiable assets recognized by the joint venture in excess of the fair value of the joint venture as a whole) resulting from the formation transaction as an adjustment to equity.
Clarify the types of arrangements and business combinations guidance that a joint venture would analyze to determine whether transactions are separate from or part of the joint venture formation. The FASB decided that a joint venture would analyze whether any contingent payments to the venturers or employees are part of the joint venture formation or represent a transaction separate from the joint venture formation, while the business combinations guidance for preexisting relationships or acquisition-related costs would not apply.
Clarify that the formation date is always the measurement date and that if multiple transactions are accounted for as a single transaction, then the identifiable assets and liabilities would be recognized when they have satisfied the recognition criteria in Subtopic 805-20, Business Combinations—Identifiable Assets and Liabilities, and Any Noncontrolling Interest.
Require that any contingent arrangements deemed to be part of the joint venture formation and classified within assets or liabilities follow the guidance in Subtopic 805-20.
Provide guidance for scenarios in which the joint venture replaces share-based payment awards.

For more information, click here.

Investment in Tax Credit Structures – FASB Ratifies Consensus-for-Exposure

Summary - As reported in its “Summary of Board Decisions” publication, the FASB met on July 13, 2022, and ratified the consensus-for-exposure EITF 21-A, “Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method.” The FASB directed its staff to draft a proposed Accounting Standards Update (ASU) reflecting the consensus-for-exposure for vote by written ballot.

For more information, click here.

FASB Agenda – FASB Discusses Agenda Prioritization

Summary - As reported in its “Summary of Decisions” publication, the FASB met on August 31, 2022 and discussed the results of staff research and analysis on an agenda request that highlights a perceived lack of certain disclosures related to the use of bank credit and services. The FASB decided not to add a project to its technical agenda.

For more information, click here.

Segment Reporting – FASB Discusses Segment Reporting

Summary - As reported in its “Summary of Decisions” publication, the FASB met on July 27, 2022 and discussed feedback from the external review of the staff draft of the proposed Accounting Standards Update (ASU). The FASB also discussed two potential disclosures and a sweep issue that was identified from the external review of the staff draft.

The FASB reached a number of decisions, including the following:

Require that a public entity disclose the title and position of its Chief Operating Decision Maker (CODM).
A public entity should disclose the nature of the expense information that the CODM uses to manage operations if the entity does not disclose significant expense categories and amounts under the significant expense principle for one or more of its reportable segments.
To permit a public entity to report multiple measures of a segment’s profit or loss.

For more information, click here.

Investment in Tax Credit Structures –FASB Ratifies Consensus-for-Exposure

For more information, click here.

Segment Reporting –FASB Discusses Segment Reporting

Summary - As reported in its “Summary of Board Decisions” publication, the FASB met on July 27, 2022, and discussed feedback from the external review of the staff draft of the proposed ASU. The FASB also discussed two potential disclosures and a sweep issue that was identified from the external review of the staff draft. Among other things, the FASB decided to require that a public entity disclose the title and position of its CODM.

The FASB had previously decided to require that a public entity disclose segment expenses under a significant expense principle. At this meeting, the FASB decided that a public entity should disclose the nature of the expense information that the CODM uses to manage operations if the entity does not disclose significant expense categories and amounts under the significant expense principle for one or more of its reportable segments.

For more information, click here.

Digital Assets –FASB Discusses Accounting for Exchange-Traded Digital Assets and Commodities

Summary - As reported in its “Summary of Decisions” publication, the FASB met on May 11, 2022, and discussed whether to add a project to its technical agenda to address the accounting for exchange-traded digital assets and commodities. The FASB added a project to its technical agenda to improve the accounting for and disclosure of certain digital assets.

The FASB decided not to add to its technical agenda a project that would address the accounting for exchange-traded commodities; however, the chair decided that this topic would remain a research agenda project.

The FASB is expected to consider potential scope alternatives for digital assets at a future meeting.

For more information, click here.

Interim Reporting –FASB Discusses Narrow-Scope Improvements to Interim Reporting

Summary - As reported in its “Summary of Decisions” publication, the FASB met on May 25, 2022, and discussed feedback received on the proposed Accounting Standards Update, Interim Reporting (Topic 270): Disclosure Framework—Changes to Interim Disclosure Requirements, and feedback received on the June 2021 Invitation to Comment, Agenda Consultation.

The FASB decided that the project objective is to improve the Codification guidance in Topic 270 by clarifying when the guidance in Topic 270 is applicable and improving the navigability of the required interim disclosures.

In furthering this objective, the FASB directed its staff that the future amendments to the disclosure principle should be intended to complement the interim disclosure requirements in Topic 270.

The FASB affirmed the amendments to the objective of Topic 270 to provide guidance on accounting and disclosure issues specific to interim reporting and to set forth disclosure requirements for interim financial statements and notes in accordance with generally accepted accounting principles.

Additionally, the FASB decided to include all of the amendments in the proposed Update in the scope of redeliberations.

For more information, click here.

Exposure Draft - Proposed Accounting Standards Update 2022-001 —Reference Rate Reform (Topic 848) and Derivatives and Hedging (Topic 815): Deferral of the Sunset Date of Topic 848 and Amendments to the Definition of the Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate

Summary - The FASB issued a proposed Accounting Standards Update (ASU) that would extend the period of time preparers can utilize the reference rate reform relief guidance and expand the Secured Overnight Financing Rate (SOFR)-based interest rates available as benchmark interest rates. Stakeholders are encouraged to review and provide feedback on the proposed ASU by June 6, 2022.

Issue 1: Proposed Sunset Date Deferral

In 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides optional guidance to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting.

To ensure the relief in Topic 848 covers the period of time during which a significant number of modifications may take place, the amendments in the proposed ASU would defer the sunset date of Topic 848 from December 31, 2022, to December 31, 2024, after which entities would no longer be permitted to apply the relief in Topic 848.

Issue 2: Proposed Amendments to the Definition of the Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate

In 2018, the FASB issued ASU No. 2018-16, Derivatives and Hedging (Topic 815): Inclusion of the Secured Overnight Financing Rate (SOFR) Overnight Index Swap (OIS) Rate as a Benchmark Interest Rate for Hedge Accounting Purposes, which added the term Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate (SOFR Swap Rate) to the Master Glossary of the FASB Accounting Standards Codification®. The amendments in ASU No. 2018-16 also permitted a rate that meets the definition of the SOFR Swap Rate to be considered a benchmark interest rate and therefore eligible to be designated as the hedged risk for recognized fixed-rate financial instruments or a forecasted issuance or purchase of fixed-rate financial instruments.

In ASU No. 2018-16, the FASB stated that the definition of the SOFR Swap Rate was specific to the OIS rate based on SOFR and that it would monitor the developments of the forward-looking, term-based version of the SOFR rate (SOFR term) and consider including SOFR term as a benchmark interest rate in the future. Based on the developments of SOFR term in the marketplace, the proposed ASU would amend the definition of the SOFR Swap Rate to include other versions of SOFR, such as SOFR term, as a benchmark interest rate under Topic 815.

For more information, click here.

FASB Accounting Standards Updates - Accounting Standards Update No. 2022-02 —Financial Instruments —Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures

Summary - The FASB issued Accounting Standards Update (ASU) No. 2022-02, Financial Instruments—Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures, intended to improve the usefulness of information provided to investors about certain loan refinancings, restructurings, and writeoffs.

FASB Chair Richard R. Jones stated, “The new ASU responds to feedback we received from investors and other stakeholders during our extensive post-implementation review (PIR) of the credit losses standard. The amendments create a single model for loan modification accounting by creditors while providing improved loan modification and writeoff disclosures.”

Troubled Debt Restructurings by Creditors That Have Adopted CECL

During the FASB’s PIR of the credit losses standard, including a May 2021 roundtable, investors and other stakeholders questioned the relevance of the troubled debt restructuring (TDR) designation and the usefulness of disclosures about those modifications. Some noted that measurement of expected losses under the CECL model already incorporates losses realized from restructurings that are TDRs and that relevant information for investors would be better conveyed through enhanced disclosures about certain modifications.

The amendments in the new ASU eliminate the accounting guidance for TDRs by creditors that have adopted CECL while enhancing disclosure requirements for certain loan refinancings and restructurings by creditors made to borrowers experiencing financial difficulty.

Vintage Disclosures—Gross Writeoffs

The disclosure of gross writeoff information by year of origination was cited by numerous investors as an essential input to their analysis. To address this feedback, the amendments in the new ASU require that a public business entity disclose current-period gross writeoffs by year of origination for financing receivables and net investment in leases.

For more information, click here.

FASB Agenda –SEC Acting Chief Accountant Discusses FASB Agenda

Summary - SEC Acting Chief Accountant Paul Munter issued a Statement on the FASB’s Agenda Consultation: Engagement with Investors and Other Stakeholders Vital to Development of High Quality Accounting Standards. Munter indicates that it “is critically important that the FASB, and the Trustees of the Financial Accounting Foundation (the “FAF”) in its important oversight role over the FASB, continue to improve processes for obtaining and considering investor and other stakeholder feedback, and for clearly communicating with those stakeholders regarding how that feedback has impacted the standard-setting process. On behalf of Commission staff in OCA, in this statement, we highlight below why engagement with investors and other stakeholders is vital to the FASB’s ability to develop high quality accounting and financial reporting standards, and we provide observations on the FASB’s standard-setting process, its agenda consultation, and the related ITC feedback from investors and other stakeholders.”

Munter discusses the importance of investors and other stakeholders to the standard-setting process. Also included in the statement is observations of the FASB’s agenda consultation. Munter indicated that in the FASB’s “decisions to add projects to its agenda or make changes to its standards, the FASB should clearly make the case for change, whether through a preliminary yet robust analysis of the need for a project or through an explanation of its consideration of the expected costs and benefits of a change. In the FASB’s consideration of what would provide decision-useful information to investors, and in making the case for change, it should consider costs to both preparers and users, including the costs to users from not making needed improvements to accounting and disclosure requirements.”

For more information, click here.

2021 FASB Investor Outreach Report

Summary - The FASB has issued its 2021 Investor Outreach Report (Report), which highlights the investor outreach completed by the FASB staff over the last year.

The outreach included engagement in more than 430 investor interactions. Substantially all the interactions were the result of outreach aimed at soliciting investor perspectives, including buy-side portfolio managers and analysts, sell-side analysts, accounting analysts (both buy-side and sell-side), credit rating agency analysts and managers, individual investors, and private company lenders and other capital providers (e.g., venture capital/private equity).

According to FASB Chair Richard J. Jones, “[i]nvestor perspectives are critical to the Board’s ability to develop effective standards, so we undertake a number of initiatives to proactively engage this stakeholder group in our standard-setting process. The report explains our investor outreach program, activities over the last year, how we’ll continue to build on those initiatives to enhance our investor outreach efforts, and, perhaps most importantly, how investors can share their views with us.”

In addition to the issuance of the Report, the FASB launched an investor web portal to provides information on projects of interest to investors, investor-focused educational videos on specific standards, and how investors can share their views on all FASB activities.

For more information, click here.

Intangible Assets – FASB Discusses Identifiable Intangible Assets and Subsequent Accounting for Goodwill

Summary - As reported in its “Summary of Board Decisions” publication, the FASB met on November 17, 2021, and discussed identifiable intangible assets and subsequent accounting for goodwill. Specifically, the FASB discussed staff research and analysis on the elements of an estimated goodwill amortization model. This discussion involved an overall amortization period estimation principle, a possible list of factors, providing a cap and floor on the amortization period, and the reassessment of an estimated goodwill amortization period. The FASB made no decisions at this meeting.

For more information, click here.

FASB Agenda – FASB Discusses its Agenda

Summary - As reported in its “Summary of Board Decisions” publication, the FASB me on December 15, 2021, and discussed stakeholder feedback received on its June 2021 Invitation to Comment, Agenda Consultation. In response to feedback received, FASB Chair Rich Jones announced comprehensive changes to the FASB research agenda. The FASB’s research agenda will be comprised of the following projects (in no particular order):

Accounting for Exchange-Traded Digital Assets and Commodities: This research project will explore accounting for and disclosure of a subset of exchange-traded digital assets and exchange-traded commodities.
Accounting for and Disclosure of Intangibles: This research project will consider potential ways to improve the accounting for and disclosure of intangibles, including software costs, internally developed intangibles, and research and development.
Hedge Accounting Phase 2: This research project will seek stakeholder feedback that could bring further alignment of hedge accounting with risk management activities beyond the targeted improvements made to the hedge accounting model in Accounting Standards Update No. 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities, and consider changes to the definition of a derivative.
Accounting for Financial Instruments with Environmental, Social, and Governance (ESG)-Linked Features and Regulatory Credits: This research project will explore accounting for and disclosure of financial instruments with ESG-linked features and regulatory credits.
Accounting for Government Grants, Invitation to Comment: This research project will solicit feedback on whether the requirements in IAS 20, Accounting for Government Grants and Disclosure of Government Assistance, should be incorporated into GAAP.
Agenda Consultation: This research project will solicit feedback about the financial reporting issues that the Board should consider adding to its agenda and the priority of those issues.

The FASB staff also updated the board on its progress on the reference rate reform—fair value hedging project. The FASB directed the staff to perform additional outreach and research. The Board made no decisions.

Regarding reference rate reform—deferral of the sunset date of Topic 848, the FASB decided to add a project to the technical agenda to defer the sunset date of Topic 848, Reference Rate Reform. The FASB also decided to defer the sunset date of the guidance in Topic 848 to December 31, 2024.

For more information, click here.

Segment Reporting –FASB Discusses Segment Reporting

Summary - As reported in its “Summary of Board Decisions” publication, the FASB me on December 8, 2021, and continued its deliberations of a principle-based disclosure requirement to report the significant segment expense categories and amounts that are both: (1) regularly provided to the chief operating decision maker (CODM); and (2) included in the reported measure of segment profit or loss. The FASB made the following decisions.

Multiple Segment Profit or Loss Measures
The FASB discussed whether to clarify which of a segment’s profit or loss measures the principle applies to when multiple measures are reported. The FASB decided that the principle should apply to all reported measures of a segment’s profit or loss.

Transition
The FASB discussed transition and decided that:

The proposed amendments should be applied retrospectively for each comparative period that an income statement is presented.
When applying the amendments retrospectively, a public entity should first apply the principle to identify the significant segment expense categories and amounts for the current period presented (that is, the period of adoption). The entity should then disclose the comparative period amounts for those same categories.

The FASB also decided that a public entity should provide a qualitative transition disclosure about certain changes to the segment expenses included in the management reports that are regularly provided to the CODM.

For more information, click here.