September 27, 2018
The Emerging Issues Task Force (EITF) met on September 27, 2018, and deliberated the following topics:
- Issue No. 18-A, “Recognition under Topic 805 for an Assumed Liability in a Revenue Contract” (Issue 18-A)—The Task Force discussed different alternatives for the recognition and measurement of an assumed liability from a revenue contract in a business combination to address potential unintended consequences of the decisions reached at the June 27, 2018 meeting. In summary, the EITF reaffirmed its consensus-for-exposure that the performance obligation definition in Topic 606 would be used to determine whether a liability assumed for a contract liability from a revenue contract with a customer is recognized by the acquirer in a business combination and decided not to address the measurement of the liability. The EITF also recommended to the Board that the staff issue an Invitation to Comment (separate from the proposed Update that would result from the Task Force’s consensus-for-exposure if it is ratified) to solicit input about measurement and other topics related to the Task Force’s consensus-for-exposure.
- Issue No. 18-B, “Improvements to Accounting for Episodic Television Series” (Issue 18-B)—In summary, the EITF reached a consensus-for-exposure to converge the capitalization guidance for films and episodic content. The Task Force also reached a consensus-for-exposure to allow an entity to assess a film group for impairment and amend the presentation and disclosure requirements for films and episodic content. In addition, the Task Force agreed to make conforming amendments to Subtopic 920-350: Entertainment—Broadcasters—Intangibles—Goodwill and Other, to align its impairment and presentation and disclosure guidance with the Task Force’s decisions. The EITF also reached decisions on other items, including amortization, transition, and transition disclosures.