FASB Issues ASU 'Technical Corrections and Improvements'

By Anne Rosivach

The Financial Accounting Standards Board (FASB) has issued amendments to the FASB Accounting Standards Codification® based on feedback from stakeholders. The amendments, issued as Accounting Standards Update, Technical Corrections and Improvements (ASU No. 2012-04), are the product of a standing FASB project, which was added to the board's agenda in 2012 by then acting FASB Chairman Leslie Seidman.
 
The project is designed to facilitate Codification updates for technical corrections, clarifications, and improvements, and to eliminate the need for periodic agenda requests for narrow and incremental items.
 
Since the Codification was established in September 2009, constituents have generated feedback on minor corrections and clarifications using the Codification Research System's feedback mechanism. Changes to the Codification are communicated through an ASU. 
 
Conforming Amendments in ASU No. 2012-04
The October 2012 update includes more substantive, limited-scope improvements. These are items that represent narrow and incremental improvements to US GAAP and are not purely technical corrections. The update contains conforming amendments to the Codification to reflect the measurement and disclosure requirements of Topic 820, Fair Value Measurement, that identify when the use of "fair value" should be linked to the definition of fair value in Topic 820.
 
The amendments included in the update are generally non-substantive in nature. The update states:
 
"The amendments in this Update represent changes to clarify the Codification, correct unintended application of guidance, or make minor improvements to the Codification that are not expected to have a significant effect on current accounting practice or create a significant administrative cost to most entities. Additionally, the amendments will make the Codification easier to understand and the fair value measurement guidance easier to apply by eliminating inconsistencies and providing needed clarifications."
 
Effective Date
The amendments in ASU No. 2012-04 that will not have transition guidance will be effective upon issuance. 
 
Amendments may result in changes to existing practice. Transition guidance has been provided for certain amendments which the Board deemed to be more substantive and the effective date will be delayed. 
 
For public entities, the amendments that are subject to the transition guidance will be effective for fiscal periods beginning after December 15, 2012. For nonpublic entities, the amendments that are subject to the transition guidance will be effective for fiscal periods beginning after December 15, 2013.
 
Changes to US GAAP
The update is not intended to significantly change US GAAP. The amendments are not expected to create any new differences between US GAAP and IFRS.
 
Related article:
 

You may like these other stories...

Credit Suisse says pension assets at risk unless court delays sentencingJohn Letzing of the Wall Street Journal reported on Wednesday that Credit Suisse Group AG says its management of billions of dollars in assets for...
The prospect of International Financial Reporting Standards (IFRS) being fully adopted in the United States in the near future are growing less likely, as the Financial Accounting Standards Board (FASB) and the International...
House proposes $10.5B, eight-month highway billThe House Ways and Means Committee proposed a transportation funding bill on Tuesday that calls for a temporary extension of current transportation funding levels until May 31,...

Upcoming CPE Webinars

Jul 16
Hand off work to others with finesse and success. Kristen Rampe, CPA will share how to ensure delegated work is properly handled from start to finish in this content-rich one hour webinar.
Jul 17
This webcast will cover the preparation of the statement of cash flows and focus on accounting and disclosure policies for other important issues described below.
Jul 23
We can’t deny a great divide exists between the expectations and workplace needs of Baby Boomers and Millennials. To create thriving organizational performance, we need to shift the way in which we groom future leaders.
Jul 24
In this presentation Excel expert David Ringstrom, CPA revisits the Excel feature you should be using, but probably aren't. The Table feature offers the ability to both boost the integrity of your spreadsheets, but reduce maintenance as well.