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    FASB Issues Taxonomies for 2023, Defers Reference Rate Reform Guidance

    January 05, 2023

    The Financial Accounting Standards Board (FASB) announced availability of the 2023 GAAP Financial Reporting Taxonomy, the 2023 SEC Reporting Taxonomy, and the 2023 Data Quality Committee (DQC) Rules Taxonomy. Additionally, FASB issued an accounting standard update that would defer the sunset date of the reference rate reform guidance (Topic 848) and extended the comment period for the proposed meta model relationships till May 11, 2023.

    FASB Taxonomies. The 2023 GAAP Financial Reporting Taxonomy contains updates for accounting standards and other recommended improvements, including the finalized rules related to business development companies that submit financial statement information using Inline eXtensible Business Reporting Language (XBRL). The 2023 SEC Reporting Taxonomy contains improvements on obligations to safeguard crypto-assets that an entity holds for platform users and modified the documentation labels to identify the substance and intended application of the elements. Both the taxonomies are expected to be accepted as final by the SEC in early 2023. FASB is also making available the 2023 DQC Rules Taxonomy. The DQC Rules Taxonomy is uniquely structured from the typical design of XBRL taxonomies because it is narrowly focused on conveying the XBRL US DQC validation rules, predominantly for regulator use. It is not intended to be used in SEC filers’ extension taxonomies, the way that the GAAP Financial Reporting Taxonomy or the SEC Document and Entity Information Taxonomy (DEI) is used. The DQC Rules Taxonomy contains a subset of the DQC rules. The FASB Taxonomy staff evaluated the validation rules for inclusion in the DQC Rules Taxonomy that have been available for use for more than a year, with consideration for how the DQC addressed any feedback received on a validation rule.

    Deferral of the sunset date for Topic 848 guidanceIn 2020, FASB had issued an Accounting Standards Update on reference rate reform, which provides optional guidance to ease the potential burden in accounting for (or recognizing the effects of) the reference rate reform on financial reporting. The objective of the guidance was to provide relief during the temporary transition period. In 2021, the UK Financial Conduct Authority (FCA) delayed the intended cessation date of certain tenors of USD LIBOR to June 30, 2023. Thus, to ensure the relief in Topic 848 covers the time during which a significant number of modifications may take place, the amendments in the proposed Accounting Standards Update 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.

    Proposed Meta Model RelationshipsFASB also extended the comment period for the proposed meta model relationships. The existing XBRL relationships provide presentation, syntax, and validation while the proposed meta model relationships add base level accounting model relationships. The proposed meta model relationships are being exposed to receive input on whether it has utility in practice. The Taxonomy staff requests input on the relationships provided as well as any additional relationships that should be added to the meta model. The main purpose of the relationships in the meta model is to assist preparers in identifying the proper elements for tagging their filings, assist data users in the consumption of data with additional relationship information, and assist in writing business rules that leverage this information to assist with proper element selection and identification.


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    Keywords: Americas, US, Banking, Reporting, GAAP Taxonomy, SEC Reporting Taxonomy, DQCRT, Reference Rate Reform, Topic 848, Accounting Standards Update, Meta Model Relationships, FASB

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