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, May 12, 2021 FASB Board Meeting

Segment reporting. The Board continued its deliberations of a principle-based disclosure requirement to report the significant segment expense categories that are both (1) regularly provided to the chief operating decision maker (CODM) and (2) included in the reported measure of segment profit or loss.

The Board made the following additional decisions related to the principle.

Interim Reporting

The Board decided that a public entity would be required to apply the significant expense principle on an interim basis in addition to an annual basis. The Board also decided that an entity would be required to apply on an interim basis the annual disclosure requirements in paragraphs 280-10-50-22 and 280-10-50-25.

The Board further decided not to require additional reconciliations for any interim segment disclosures. Rather, the existing reconciliation for segment profit or loss would be retained.
Restatement of Prior-Period Segment Information to Conform to Current-Period Segment Information

The Board discussed three circumstances where prior-period segment expense categories could be restated in the current-period financial statements.

The Board decided that, unless impracticable, a public entity would be required to restate prior-period segment expense categories to conform to the current-period segment expense categories disclosed under the principle in the following circumstances:
  1. When an entity has new reportable segments in the current period.
  2. When an entity changes the expense categories in its CODM management reports.
The Board decided that a public entity would not be required to restate prior-period segment expense categories in the current period as a result of changes in measurement methods, although it is preferable to do so.

The Board also decided to replace the term restatement of prior-period information with the term recasting of prior-period information within Topic 280, Segment Reporting.

Conceptual framework—elements. The Board discussed the feedback from comment letter respondents on issues related to the definitions of revenues, expenses, gains, and losses in the proposed FASB Concepts Statement No. 8, Conceptual Framework for Financial Reporting—Chapter 4, Elements of Financial Statements. The Board decided the following:
  1. To remove the phrases ongoing major or central operations from the definitions of revenues and expenses and peripheral or incidental transactions from the definitions of gains and losses.
  2. To retain the use of the term other activities when defining revenues and expenses.
  3. To make drafting improvements that link the concepts for distinguishing revenues from gains and expenses from losses to the presentation factors in the forthcoming Chapter 7, Presentation, of Concepts Statement 8.
Next Steps

The Board will discuss additional feedback from comment letter respondents related to proposed Chapter 4 of Concepts Statement 8 at a future Board meeting.