June 28, 2018
The Investor Advisory Committee (IAC) met on June 28, 2018. At the meeting, the FASB staff delivered updates and IAC members provided input on the following FASB topics:
- IAC Emerging Issues and Trends: IAC members discussed their observations on the adoption of the new revenue recognition standard (Topic 606, Revenue from Contracts with Customers) and observations on Financial Instruments—Credit Losses, commonly referred to as CECL, implementation progress.
- Income Tax Reform—Disclosure Focus: IAC members discussed information investors focus on in their analyses of the income tax disclosure and recommended additional transparency of information on a country-by-country basis. Members also discussed the ongoing disclosure review project and the effect of the Tax Cuts and Jobs Act on current and proposed income tax disclosures.
- FASB Ongoing Project Efforts: The IAC discussed two current projects on the FASB’s technical and research agendas: Simplifying the Balance Sheet Classification of Debt, and Accounting for Certain Identifiable Intangible Assets in a Business Combination and Subsequent Accounting for Goodwill. On the balance sheet classification of debt project, the IAC recommended the Board reverse its tentative decision to reclassify current debt as a non-current liability when there are unused long-term financing arrangements. Related to the subsequent accounting of goodwill, the IAC members supported the project’s objective to reduce cost and complexity but disagreed with extending the private company alternative to amortize goodwill to public business entities. IAC members also discussed both goodwill and intangible assets disclosures.
- Disclosure Review Research Project: IAC members discussed the disclosure review project specifically related to share-based payments and foreign currency. For share-based payment disclosures, IAC members discussed adding information that would facilitate the calculation of share dilution. For foreign currency disclosures, the IAC emphasized the complexity of the accounting for this area and discussed the utility of increased disclosure of foreign currency effects on income statement line items.