6.2 Balance Sheet Presentation for Assets (Disposal Groups) Classified as Held for Sale That Are Not Discontinued Operations
ASC 360-10
Presentation of
Long-Lived Assets or Disposal Group Classified as
Held for Sale
45-14
A long-lived asset classified as held for sale (but not
qualifying for presentation as a discontinued operation in
the statement of financial position in accordance with
paragraph 205-20-45-10) shall be presented separately in the
statement of financial position of the current period. The
assets and liabilities of a disposal group classified as
held for sale shall be presented separately in the asset and
liability sections, respectively, of the statement of
financial position. Those assets and liabilities shall not
be offset and presented as a single amount. The major
classes of assets and liabilities classified as held for
sale shall be separately presented on the face of the
statement of financial position or disclosed in the notes to
financial statements (see paragraph 360-10-50-3(e)).
For disposal groups that are classified as held for sale but that do not meet
the criteria for discontinued-operations reporting, ASC 360-10-45-14 requires that
the assets and liabilities of the disposal group be separately presented on the face
of the balance sheet only in the initial period in which it
is classified as held for sale. As a result, if a disposal group is sold in the same
period in which it is classified as held for sale, the assets and liabilities would
not be separately presented in the balance sheet. We believe that, while not
specifically addressed in ASC 360, in such circumstances, an entity should not
reclassify prior-period balance sheets. Such disposal groups are distinguishable
from those that do qualify for discontinued-operations reporting, since an entity
would be required to reclassify the prior period for the latter. However, in the
absence of specific guidance, we understand that diversity in practice may
exist.
In the period in which long-lived assets or disposal groups that do not qualify
as discontinued operations are classified as held for sale, their major classes of
assets and liabilities must be either (1) presented on the face of the balance sheet
in accordance with ASC 360-10-45-14 or (2) disclosed in the notes in accordance with
ASC 360-10-50-3(e).
ASC 360-10 does not address whether entities should separately present the
assets and liabilities of a disposal group classified as held for sale as current
and noncurrent. Accordingly, we believe that it is acceptable to present these
assets and liabilities as current in the current-period balance sheet if it is
probable that the sale will occur, consideration will be collected within one year,
and the proceeds are not expected to be used to settle long-term debt (in accordance
with ASC 210-10-45-4).