3.7 Long-Lived Assets to Be Disposed of in Exchange for Noncash Assets in a Transaction Accounted for at Fair Value
Sometimes a disposal group is to be disposed of in exchange for an
asset or assets other than cash. If the disposal group is to be exchanged in a
transaction accounted for at fair value, we believe that it should be classified as
held for sale once the classification criteria are met. That is, regardless of
whether the form of the consideration received is cash or noncash assets, such an
exchange would represent a sale of the disposal group. The following are examples of
exchange transactions accounted for at fair value:
- Contributions of long-lived assets to an entity in exchange for a noncontrolling investment in that entity (e.g., an equity method investment or a joint venture investment).
- A nonmonetary exchange that does not meet any of the conditions in ASC 845-10-30-3 and is therefore measured at fair value. (See Section 4.3 for information on situations in which the nonmonetary exchange meets any of those conditions and must be accounted for at its carrying amount.)