Post-Implementation Review of Topic 326, Financial Instruments—Credit Losses. The Board discussed an agenda request to provide a practical expedient that would allow all entities to not apply the recognition and measurement guidance on troubled debt restructurings within Subtopic 310-40, Receivables—Troubled Debt Restructurings by Creditors.   

The Board decided not to add a project to its technical agenda.    

 

 

 

Segment Reporting. The Board discussed two issues that arose during the drafting of the proposed Accounting Standards Update based on the Board’s tentative decisions to require a significant expense principle. The principle would require that a public entity disclose the significant expense categories and amounts that are both (1) regularly provided to the chief operating decision maker (CODM) and (2) included in each reported measure of segment profit or loss.

 

The Board made the following decisions.

Applying the Significant Expense Principle to Gross Interest Expense for Financial Operations Segments

Topic 280, Segment Reporting, currently allows a public entity to disclose only net interest revenue for a financial operations segment when a majority of the segment’s revenues are from interest and the CODM primarily relies upon net interest revenue to assess segment performance. The Board decided that the proposed Update would require a financial operations segment that discloses net interest revenue to also disclose gross interest expense if that information meets the requirements for disclosure under the significant expense principle.

Reconciliation of Significant Segment Expenses to Consolidated Expense Amounts

The Board decided not to require the total of the reportable segments’ amount for each significant expense category disclosed under the principle to be reconciled to its corresponding consolidated amount. 

The Board also discussed the feedback received specific to the segment reporting project through the 2021 Invitation to Comment, Agenda Consultation. 

The staff will continue to draft a proposed Update for external review.