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FASB issues proposed ASUs on balance sheet debt and inventory disclosure requirements

  • FASB (US Financial Accounting Standards Board) Image

Jan 11, 2017

The FASB has issued two proposed ASUs: (1) “Simplifying the Classification of Debt in a Classified Balance Sheet (Current Versus Noncurrent)” and (2) “Disclosure Framework — Changes to the Disclosure Requirements for Inventory.”

Balance sheet classification of debt

This proposed ASU “is intended to improve financial reporting by simplifying guidance used to determine whether debt should be classified as current or noncurrent in a classified balance sheet.” Specifically, the proposal “would replace the existing, fact-specific guidance with an overarching, cohesive principle for debt classification that focuses on a borrower’s contractual rights and obligations that exist as of the reporting date.”

Comments on this proposal are due by May 5, 2017. For more information, see Deloitte's Heads Up newsletter as well as the press release on the FASB’s Web site.

Disclosure framework — inventory

This proposal “would increase inventory disclosure requirements for all reporting organizations, including:

  • Changes in inventory that are not related to the ordinary course of manufacturing, purchasing, or selling inventory.
  • Inventory disaggregated by major components.
  • Inventory disaggregated by measurement basis.
  • Qualitative description of costs capitalized.”

The FASB will host a public roundtable meeting on March 17, 2017, at the FASB’s offices in Norwalk, Connecticut, to discuss this proposal. Roundtable participants must submit a comment letter on the proposed ASU to the FASB by February 27, 2017, to be able to register. All other comments are due by March 13, 2017.

For more information, see Deloitte's Heads Up newsletter as well as the press release on the FASB’s Web site.

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