At yesterday’s Board meeting, the FASB discussed some of the more significant comments received from external reviewers on a draft of its proposed Accounting Standards Update Financial Instruments With Characteristics of Equity. The FASB staff indicated that it had received a large number of comments, which included comments about inconsistent classification results, practice issues related to the classification criteria, and increased structuring opportunities. Board members agreed that further analysis of the comments is warranted to determine whether the proposed model can be amended or, if the comments indicate that the classification model is flawed, whether the Board should consider developing a different model. In light of the Board’s discussion, the issuance of an exposure draft on this topic by the end of June 2010, as previously planned, is becoming increasingly unlikely. The FASB is expected to discuss and agree on next steps jointly with the IASB.