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- US GAAP
This Roadmap provides Deloitte’s insights into and interpretations
of the guidance on share-based payment arrangements in ASC 718 related to employee
and nonemployee awards and in other literature (e.g., ASC 260 and ASC 805).
The 2022 edition reflects the issuance of ASU 2021-07 and SAB 120, which are briefly
summarized below. Also new to this year’s update are several short videos that
highlight certain aspects of the accounting for share-based payments. Appendix E
describes all new content in the Roadmap as well as any substantive revisions to
previous content.
In October 2021, the FASB issued ASU 2021-07, which allows nonpublic entities to use,
as a practical expedient, “the reasonable application of a reasonable valuation
method” to determine the current price input of equity-classified share-based
payment awards issued to both employees and nonemployees. Section 4.13.1.3 provides additional
details about the ASU.
The following month, the SEC staff issued SAB 120, which provides the staff’s views
on the measurement and disclosure of certain share-based payment awards granted when
entities possess positive material nonpublic information (i.e., “spring-loaded”
awards). Under SAB 120, an entity that grants a share-based payment award while in
possession of positive material nonpublic information should consider whether
adjustments to the following are appropriate when determining the fair-value-based
measure of the award: (1) the current price of the underlying share or (2) the
expected volatility of the price of the underlying share for the expected term of
the share-based payment award. For more information about SAB 120, see Section 4.9.2.