{"id":2708,"date":"2023-09-11T15:19:28","date_gmt":"2023-09-11T19:19:28","guid":{"rendered":"https:\/\/seci.wpenginepowered.com\/?p=2708"},"modified":"2023-09-11T15:19:32","modified_gmt":"2023-09-11T19:19:32","slug":"fasb-projects-progressing","status":"publish","type":"post","link":"https:\/\/seciblog.pli.edu\/index.php\/fasb-projects-progressing\/","title":{"rendered":"FASB Projects Progressing"},"content":{"rendered":"<p style=\"font-weight: 400;\">In this <a href=\"https:\/\/seciblog.pli.edu\/four-projects-to-watch-at-the-fasb\/\">post from May 2023<\/a>, we overviewed four FASB projects that will likely require significant implementation efforts.\u00a0 These coming new standards will require new disclosures that will involve system and reporting complexities.\u00a0 The four projects are:<\/p>\n<ul>\n<li style=\"list-style-type: none;\">\n<ul>\n<li>Segment Reporting,<\/li>\n<li>Improvements to Income Tax Disclosures,<\/li>\n<li>Disaggregation \u2013 Income Statement Expenses, and<\/li>\n<li>Accounting for and Disclosure of Crypto Assets.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p style=\"font-weight: 400;\">Each of the projects has progressed to the Proposed ASU stage.\u00a0 Segment reporting, income tax disclosures and crypto asset accounting and disclosure are all in the final standard process.\u00a0 Below are summaries and links to the most recent developments for each project.<\/p>\n<p style=\"font-weight: 400;\"><strong>Segment Reporting <\/strong><\/p>\n<p style=\"font-weight: 400;\">The FASB\u2019s <a href=\"https:\/\/www.fasb.org\/technicalagenda\">Technical Agenda<\/a> indicates that a <strong>Final ASU for segment reporting is expected during the third quarter of 2023<\/strong>.\u00a0 While this project does not change the operating segment definition, it will increase disclosures about segments.\u00a0 As you can read in this <a href=\"https:\/\/www.fasb.org\/Page\/ProjectPage?metadata=fasb-SegmentReporting-022820221200\">Project Update<\/a> and the related <a href=\"https:\/\/www.fasb.org\/Page\/ShowPdf?path=Prop+ASU%E2%80%94Segment+Reporting+%28Topic+280%29%E2%80%94Improvements+to+Reportable+Segment+Disclosures.pdf&amp;title=Proposed+Accounting+Standards+Update%E2%80%94Segment+Reporting+%28Topic+280%29%3A+Improvements+to+Reportable+Segment+Disclosures&amp;acceptedDisclaimer=true&amp;IsIOS=true&amp;Submit=\">Proposed ASU<\/a>, the project will introduce a new disclosure principle focused on \u201csignificant\u201d expenses that would be used to determine which expense categories should be disclosed for individual segments.\u00a0 It also would require disclosure of \u201cother segment items\u201d and apply these same requirements to companies that report a single segment.\u00a0 There are several <a href=\"https:\/\/www.fasb.org\/page\/commentletterspage?metadata=fasb_SegmentReporting(Topic280)%E2%80%94ImprovementstoReportableSegmentDisclosures_0228221200&amp;PageId=\/projects\/commentletter.html\">comment letters<\/a> related to the Proposed ASU, including <a href=\"https:\/\/www.fasb.org\/Page\/ShowPdf?path=SEGRPT.ED.001.MASTER%20OF%20ACCOUNTANCY%20STUDENTS%20SEE%20LISTED.pdf&amp;title=SEGRPT.ED.001.MASTER%20OF%20ACCOUNTANCY%20STUDENTS%20SEE%20LISTED\">this thoughtful letter<\/a> from a group of University of Denver accounting students that includes a discussion about the Proposed ASU\u2019s use of the term \u201csignificant.\u201d<\/p>\n<p style=\"font-weight: 400;\"><strong>Improvements to Income Tax Disclosures<\/strong><\/p>\n<p style=\"font-weight: 400;\">According to the FASB\u2019s <a href=\"https:\/\/www.fasb.org\/technicalagenda\">Technical Agenda<\/a>, a <strong>Final ASU for this project is projected to be issued in the fourth quarter of 2023<\/strong>.\u00a0 As described in the related <a href=\"https:\/\/www.fasb.org\/Page\/ProjectPage?metadata=fasb-Targeted%20Improvements%20to%20Income%20Tax%20Disclosures\">Project Update<\/a>, this new standard will not change accounting for income taxes but will require new disclosures focusing on two areas, the effective rate reconciliation and taxes paid.\u00a0 You can read the March 15, 2023, <a href=\"https:\/\/fasb.org\/Page\/ShowPdf?path=Proposed+Accounting+Standards+Update%E2%80%94Income+Taxes+%28Topic+740%29%E2%80%94Improvements+to+Income+Tax+Disclosures.pdf&amp;title=Proposed+Accounting+Standards+Update%E2%80%94Income+Taxes+%28Topic+740%29%3A+Improvements+to+Income+Tax+Disclosures&amp;acceptedDisclaimer=true&amp;IsIOS=true&amp;Submit=\">Proposed ASU<\/a> and related <a href=\"https:\/\/fasb.org\/page\/commentletterspage?metadata=fasb_ImprovementstoIncomeTaxDisclosures_0228221200&amp;PageId=\/projects\/commentletter.html\">comment letters<\/a>for more background, including this interesting comment letter from the <a href=\"https:\/\/fasb.org\/Page\/ShowPdf?path=TAXDISC.ED.020.GLOBAL%20REPORTING%20INITIATIVE%20PETER%20PAUL%20VAN%20DE%20WIJS.pdf&amp;title=TAXDISC.ED.020.GLOBAL%20REPORTING%20INITIATIVE%20PETER%20PAUL%20VAN%20DE%20WIJS\">Global Reporting Initiative<\/a>.\u00a0 The due date for comment letters was May 30, 2023.\u00a0 Disclosures that may present significant challenges, particularly for companies that operate in multiple jurisdictions, include:<\/p>\n<ul>\n<li style=\"list-style-type: none;\">\n<ul>\n<li>A proposed breakdown in the effective rate reconciliation addressing eight specific categories and related qualitative disclosure, and<\/li>\n<li>Details of taxes paid including disaggregated information about taxes paid by jurisdiction.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p style=\"font-weight: 400;\"><strong>Disaggregation \u2013 Income Statement \u00a0Expenses<\/strong><\/p>\n<p style=\"font-weight: 400;\">On July 31, 2023, the FASB issued a <a href=\"https:\/\/www.fasb.org\/Page\/ShowPdf?path=Proposed+ASU%E2%80%94Income+Statement%E2%80%94Reporting+Comprehensive+Income%E2%80%94Expense+Disaggregation+Disclosures+%28Subtopic+220-40%29%E2%80%94Disaggregation+of+Income+Statement+Expenses.pdf&amp;title=Proposed+Accounting+Standards+Update%E2%80%94Income+Statement%E2%80%94Reporting+Comprehensive+Income%E2%80%94Expense+Disaggregation+Disclosures+%28Subtopic+220-40%29%E2%80%94Disaggregation+of+Income+Statement+Expenses&amp;acceptedDisclaimer=true&amp;IsIOS=true&amp;Submit=\">Proposed ASU<\/a> for this project.\u00a0 Comments are due by October 30, 2023.\u00a0 As you can read in the <a href=\"https:\/\/www.fasb.org\/Page\/ProjectPage?metadata=fasb-Disaggregation%E2%80%94IncomeStatementExpenses-022820221200\">Project Update<\/a>, the proposal would require significant incremental disclosures about certain types of expenses, including:<\/p>\n<ul>\n<li style=\"list-style-type: none;\">\n<ul>\n<li>Inventory and manufacturing expense,<\/li>\n<li>Employee compensation,<\/li>\n<li>Depreciation,<\/li>\n<li>Intangible asset amortization, and<\/li>\n<li>Depreciation, depletion, and amortization recognized as part of oil- and gas-producing activities.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p style=\"font-weight: 400;\">Additional disaggregated information about inventory and manufacturing costs would also be disclosed.\u00a0 The <a href=\"https:\/\/www.fasb.org\/Page\/ShowPdf?path=Proposed+ASU%E2%80%94Income+Statement%E2%80%94Reporting+Comprehensive+Income%E2%80%94Expense+Disaggregation+Disclosures+%28Subtopic+220-40%29%E2%80%94Disaggregation+of+Income+Statement+Expenses.pdf&amp;title=Proposed+Accounting+Standards+Update%E2%80%94Income+Statement%E2%80%94Reporting+Comprehensive+Income%E2%80%94Expense+Disaggregation+Disclosures+%28Subtopic+220-40%29%E2%80%94Disaggregation+of+Income+Statement+Expenses&amp;acceptedDisclaimer=true&amp;IsIOS=true&amp;Submit=\">Proposed ASU<\/a> includes several examples of the proposed expense disclosures.<\/p>\n<p style=\"font-weight: 400;\"><strong>Accounting for and Disclosure of Crypto Assets<\/strong><\/p>\n<p style=\"font-weight: 400;\">According to the FASB\u2019s <a href=\"https:\/\/www.fasb.org\/technicalagenda\">Technical Agenda<\/a>, a <strong>Final ASU for this project is projected to be issued in the fourth quarter of 2023<\/strong>.\u00a0 While this project may not affect as many companies as the three discussed above, it does create accounting guidance for certain crypto assets where there was no formal guidance before.\u00a0 It would require that crypto assets, as defined by the Board, would be accounted for at fair value with unrealized gains and losses recognized in income.\u00a0 This would be a major change from the existing indefinite lived intangible asset accounting model currently applied to such assets.\u00a0 You can read more in this March 23, 2023,\u00a0<a href=\"https:\/\/www.fasb.org\/document\/blob?fileName=Prop%20ASU%E2%80%94Intangibles%E2%80%94Goodwill%20and%20Other%E2%80%94Crypto%20Assets%20(Subtopic%20350-60)%E2%80%94Accounting%20for%20and%20Disclosure%20of%20Crypto%20Assets.pdf\">Proposed ASU<\/a>\u00a0and this\u00a0<a href=\"https:\/\/www.fasb.org\/document\/blob?fileName=CRYPTO-TBDs%20to%20Date-20230201.pdf\">Tentative Board Decisions<\/a>\u00a0document.\u00a0 The comment period for the Proposed ASU ended on June 6, 2023, and you can <a href=\"https:\/\/www.fasb.org\/page\/commentletterspage?metadata=fasb_AccountingforandDisclosureofCryptoAssets_0228221200&amp;PageId=\/projects\/commentletter.html\">read comment letters here<\/a>, including this interesting <a href=\"https:\/\/www.fasb.org\/Page\/ShowPdf?path=CRYPTO.ED.008.MICROSTRATEGY%20INCORPORATED%20ANDREW%20KANG.pdf&amp;title=CRYPTO.ED.008.MICROSTRATEGY%20INCORPORATED%20ANDREW%20KANG\">letter from MicroStrategy<\/a>, a large holder of bitcoin.<\/p>\n<p style=\"font-weight: 400;\">As always, your thoughts and comments are welcome!<\/p>\n","protected":false},"excerpt":{"rendered":"<p>In this post from May 2023, we overviewed four FASB projects that will likely require significant implementation efforts.\u00a0 These coming new standards will require new disclosures that will involve system and reporting complexities.\u00a0 The four projects are: Segment Reporting, Improvements to Income Tax Disclosures, Disaggregation \u2013 Income Statement Expenses, and Accounting for and Disclosure of &hellip; <a href=\"https:\/\/seciblog.pli.edu\/index.php\/fasb-projects-progressing\/\" class=\"more-link\">Continue reading <span class=\"screen-reader-text\">FASB Projects Progressing<\/span> <span class=\"meta-nav\">&rarr;<\/span><\/a><\/p>\n","protected":false},"author":9,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"_wpas_customize_per_network":false},"categories":[143,242],"tags":[],"coauthors":[154],"class_list":["post-2708","post","type-post","status-publish","format-standard","hentry","category-hot-topic","category-reporting"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"post_mailing_queue_ids":[],"_links":{"self":[{"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/posts\/2708","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/users\/9"}],"replies":[{"embeddable":true,"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/comments?post=2708"}],"version-history":[{"count":0,"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/posts\/2708\/revisions"}],"wp:attachment":[{"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/media?parent=2708"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/categories?post=2708"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/tags?post=2708"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/coauthors?post=2708"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}