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FASB proposes technical corrections and improvements to financial instruments and leases standards

  • FASB document Image

Sep 28, 2017

The FASB has issued two proposed ASUs, “Technical Corrections and Improvements to Recently Issued Standards: (I) Accounting Standards Update No. 2016-01, Financial Instruments — Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities and (II) Accounting Standards Update No. 2016-02, Leases (Topic 842).”

The proposed ASU related to ASU 2016-01 focuses on the following topics:

  • Equity securities without a readily determinable fair value (discontinuation and adjustments.
  • Forward contracts and purchased options.
  • Presentation requirements for certain fair value option liabilities.
  • Fair value option liabilities denominated in a foreign currency.
  • Transition guidance for equity securities without a readily determinable fair value.

The proposed ASU related to ASU 2016-02 addresses the following topics:

  • Residual value guarantees.
  • Rate implicit in the lease.
  • Lessee’s reassessment of lease classification.
  • Lessor’s reassessment of lease terms and purchase options.
  • Variable lease payments that depend on an index or a rate.
  • Investment tax credits.
  • Lease terms and purchase options.
  • Transition guidance for amounts previously recognized in business combinations.
  • Certain transition adjustments.
  • Transition guidance for leases previously classified as capital leases under ASC 840.
  • Transition guidance for modifications to leases previously classified as direct financing or sales-type leases under ASC 840.
  • Transition guidance for sale-and-leaseback transactions.
  • Impairment of net investments in the lease.
  • Unguaranteed residual assets.
  • Effect of initial direct costs on the rate implicit in the lease.
  • Failed sale-and-leaseback transactions.

Comments on the proposals are due by November 13, 2017. For more information, see the proposed ASUs on the FASB’s Web site. In addition, see Deloitte's related journal entry for information on the proposed amendments to ASU 2016-01.

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