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GASB issues guidance on certain debt extinguishment issues

  • GASB document Image

May 16, 2017

The GASB has issued Statement No. 86, “Certain Debt Extinguishment Issues.”

Statement 86 improves “consistency in accounting and financial reporting for in-substance defeasance of debt by providing guidance for transactions in which cash and other monetary assets acquired with only existing resources — resources other than the proceeds of refunding debt — are placed in an irrevocable trust for the sole purpose of extinguishing debt.”

Statement 86 is effective for reporting periods beginning after June 15, 2017. Early application is encouraged.

For more information, see Statement 86 on the GASB’s Web site.

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