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PSAB - Section PS 3430, Restructuring Transactions [Completed]

Effective date: Restructuring transactions occurring in fiscal years beginning on or after April 1, 2018. Earlier application is encouraged.

Transitional provisions:

The new Section will apply to restructuring transactions occurring in fiscal years beginning on or after April 1, 2018. Earlier application is encouraged.

Last updated:

June 2015

Overview

The main features of the new Section are: (i) a restructuring transaction is a transfer of an integrated set of assets and/or liabilities, together with related program or operating responsibilities without consideration based primarily on the fair value of the individual assets and individual liabilities transferred; (ii) the net effect of a restructuring transaction should be recognized as revenue or as an expense by entities involved; (iii) a recipient should recognize individual assets and liabilities received in a restructuring transaction at their carrying amount with applicable adjustments at the restructuring date; (iv) a transferor and a recipient should not restate their financial position or results of operations; and (v) a transferor and a recipient should disclose sufficient information to enable users to assess the nature and financial effects of a restructuring transaction on their financial position and operations.

Other developments

June 2015

On June 1, 2015, the PSAB issued a Basis of Conclusions document in respect of the new Section PS 3430 which sets out how PSAB reached its conclusions. As well, it sets out significant matters arising from comments received in response to its ED and indicates how the Board dealt with the issues raised.

May 2015

On May 29, 2015, Highlight Summary No. 43 was issued dated June 2015, which includes the following new PSA Handbook material: Section PS 3430, Restructuring Transactions


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