FASB to Consult on Clarification of Interactions on Topics 321 and 323
FASB, on June 13, 2019, ratified the consensus-for-exposure on Issue No. 19-A, “Financial Instruments—Clarifying the Interactions between Topic 321 and Topic 323,” at a meeting of the Emerging Issues Task Force. At the meeting, FASB directed the staff to draft a proposal reflecting the consensus-for-exposure for vote by written ballot. FASB has decided to issue a proposal reflecting these changes for public comment for 30 days. The next Emerging Issues Task Force meeting has been tentatively scheduled for September 19, 2019.
The Task Force reached a consensus-for-exposure that an entity should:
- Consider observable transactions that would require the investor to either apply or discontinue the equity method of accounting for applying the measurement alternative under Topic 321 (Investments—Equity Securities), immediately before applying or on discontinuing the equity method under Topic 323 (Investments—Equity Method and Joint Ventures).
- Not consider whether the equity security underlying the forward contract or purchased option would, individually or with existing investments, be accounted for under the equity method on settlement of the forward contract or exercise of the purchased option for purposes of evaluating the characteristic in paragraph 815-10-15-141(a).
- Apply the proposed amendments in the Update resulting from this Issue No. 19-A prospectively. The Task Force also reached a consensus-for-exposure not to require any recurring disclosures related to equity method investments or equity securities that are accounted for under the measurement alternative.
- Disclose, in the period of adoption, the nature of and reasons for the change in accounting principle, the transition method, and a qualitative description of the financial statement line items affected by the change.
Related Links
Keywords: Americas, US, Banking, Accounting, Securities, Consensus-for-Exposure, Financial Instruments, Emerging Issues Task Force, FASB
Related Articles
EBA Updates Filing Rules for Supervisory Reporting
The European Banking Authority (EBA) published version 5.1 of the filing rules for supervisory reporting.
ECB Amends Guideline on Procedures for Collection of AnaCredit Data
The European Central Bank (ECB) Guideline 2021/1829 on the procedures for the collection of granular credit and credit risk data has been published in the Official Journal of European Union.
ECB Amends Guideline on Procedures for Collection of AnaCredit Data
The European Central Bank (ECB) Guideline 2021/1829 on the procedures for the collection of granular credit and credit risk data has been published in the Official Journal of European Union.
EBA Publishes Standards on Disclosure of Investment Policy Under IFR
The European Banking Authority (EBA) published the final draft regulatory technical standards on disclosure of investment policy by investment firms, under the Investment Firms Regulation (IFR).
APRA Finalizes Guidance for New Prudential Standard on Remuneration
The Australian Prudential Regulation Authority (APRA) published the prudential practice guide CPG 511 to assist banks, insurers, and superannuation licensees in meeting requirements of CPS 511, the new prudential standard on remuneration.
OCC Updated LIBOR Self-Assessment Tool for Banks
The Office of the Comptroller of the Currency (OCC) published a bulletin that provides an updated self-assessment tool for banks to evaluate their preparedness for cessation of the London Interbank Offered Rate (LIBOR).
TCFD Updates Guidance for Financial Disclosures on Climate Risk
The Financial Stability Board (FSB) published a report that examines the progress made toward disclosures aligned with recommendations of the Task Force on Climate-related Financial Disclosures (TCFD).
BCBS Report Examines Progress on Adoption of Basel III Framework
The Basel Committee on Banking Supervision (BCBS) published the progress report on adoption of the Basel III regulatory framework in member jurisdictions.
ACPR Implements Updates Related to DPM Version 3.1
The French Prudential Supervisory Authority (ACPR) has implemented, in its information system, updates linked to the Data Point Model (DPM) version 3.1.
EBA Note Examines Transition Risks of Benchmark Rates
The European Banking Authority (EBA) published a thematic note that aims to identify and raise awareness of the transition risks of benchmark rates, as the London Interbank Offered Rate (LIBOR) and the Euro Overnight Index Average (EONIA) are close to being phased out.
