Tentative Board Decisions

Tentative Board decisions are provided for those interested in following the Board’s deliberations. All of the reported decisions are tentative and may be changed at future Board meetings.

Wednesday, November 20, 2019 FASB Board Meeting

Ratification of EITF consensus. The Board ratified the following consensus reached by the EITF at its November 7, 2019 meeting and directed the staff to draft an Accounting Standards Update reflecting the consensus for vote by written ballot.
 
Issue No. 19-A, “Financial Instruments—Clarifying the Interactions between Topic 321, Topic 323, and Topic 815”
 
An entity should consider observable transactions that would require an investor to either apply or discontinue the equity method of accounting for purposes of applying the measurement alternative under Topic 321, Investments—Equity Securities, immediately before applying or upon discontinuing the equity method.
 
For the purpose of applying paragraph 815-10-15-141(a) an entity should not consider whether, upon the settlement of the forward contract or exercise of the purchased option, individually or with existing investments, the underlying securities would be accounted for under the equity method or the fair value option in accordance with Topic 825, Financial Instruments.
 
An entity is required to apply the amendments in the final Update prospectively and to disclose 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.
 
The amendments in the final Update will be effective for public business entities for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. For nonpublic business entities, the amendments in the final Update will be effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. Additionally, early adoption is permitted in any interim period after the issuance of the final Update.