Appendix C — Roadmap Updates for 2025

Updated discussion to reflect the FASB’s issuance of ASU 2025-07 on derivative scope refinements.

Underlying

Added a Changing Lanes discussion of the FASB’s issuance of ASU 2025-07 on derivative scope refinements.

Concept of Effective Notional Amount

Expanded Connecting the Dots to discuss cash flow considerations related to blend and extend strategies with an other-than-insignificant financing element at the time of modification.

Asymmetrical Default Provision Does Not Constitute Net Settlement

Added discussion regarding the ASC 815 guidance on asymmetric default provisions and examples of contracts for which this guidance does not apply.

Scope Exceptions

Removed video discussing the proposed ASU on derivative scope refinements because ASU 2025-07 was issued in September 2025.

Certain Contracts That Are Not Traded on an Exchange

Removed Changing Lanes discussion of the FASB’s tentative conclusions related to predominance assessments in cases in which an arrangement has multiple underlyings. Guidance related to predominance assessments is being removed by ASU 2025-07.

Underlyings Based on Operations or Activities of One of the Parties to a Contract

Amended section title and added discussion of the new derivative scope exception in ASU 2025-07. Removed previous discussion of R&D funding arrangements since these are specifically addressed in the new ASU.

Other Payment Provisions in Contracts: Background

Added a Changing Lanes discussion of the new derivative scope exception in ASU 2025-07.

Contingent Interest Rate Features in ESG-Linked Debt Instruments

Updated Changing Lanes to discuss the new derivative scope exception in ASU 2025-07.

Added discussion addressing differences between U.S. GAAP and IFRS Accounting Standards related to assessing derivative scope exceptions for contracts with payments indexed to operations or activities specific to one of the parties to the contract.