Classification and Measurement of Financial Instruments — FASB Makes Additional Decisions

Published on: 20 Jun 2012

At its meeting today, the FASB tentatively decided to require:

  • Separate presentation, in other comprehensive income, of changes in fair value attributable to changes in own credit risk for financial liabilities measured at fair value through net income under the fair value option.1
  • Recycling to net income of these changes upon the settlement of liability.

The FASB also tentatively decided to extend to public entities the practicability exception from fair value measurement for investments in nonmarketable equity securities. Under this exception, entities would be allowed to measure nonmarketable equity securities at cost less any impairment, plus or minus adjustments in fair value when a change in price is observable.


[1] See Deloitte’s June 14, 2012, journal entry for more information about the FASB’s tentative decision regarding fair value options.

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