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Journal Entry — Discontinued Operations — FASB Decides to Issue Exposure Draft

Published on: Mar 13, 2013

At its meeting today, the FASB decided to issue an exposure draft on reporting discontinued operations by the end of the first quarter of 2013. The proposal would substantially converge the definition of a discontinued operation under ASC 205-201 with that under IFRS 52 and would expand the disclosure requirements for disposals, including disclosures about significant components that do not qualify as discontinued operations.

In addition to promoting convergence, the proposed guidance is intended to address the FASB’s concerns that (1) financial statements may not be decision-useful when too many disposals of assets qualify for discontinued operations and (2) there are challenges and inconsistencies with applying the current continuing involvement criterion used in determining whether a component of an entity should be reported in discontinued operations.

The proposal would have a 150-day comment period. For more information about the proposal, see the project page on the FASB’s Web site. Also, watch for Deloitte’s upcoming Heads Up on the proposal.


[1] FASB Accounting Standards Codification Subtopic 205-20, Presentation of Financial Statements: Discontinued Operations.

[2] IFRS 5, Non-current Assets Held for Sale and Discontinued Operations.

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