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Appendix F — Roadmap Updates for 2023

Appendix F — Roadmap Updates for 2023

Appendix F — Roadmap Updates for 2023

The table below summarizes the substantive changes made in the 2023 edition of this Roadmap.
Section
Topic
Description
 
Updated for 2023.
Dividends Paid in Shares of Preferred Stock
Amended guidance on PIK dividends.
Increasing-Rate Preferred Stock
Added guidance to clarify (1) the application of SAB Topic 5.Q to convertible preferred stock and (2) the relationship between SAB Topic 5.Q and the SEC’s guidance on redeemable equity securities.
Convertible Preferred Stock
Deleted guidance on beneficial conversion features and moved guidance on down-round features to Section 3.2.2.5.1.
Redemption of Preferred Stock
Enhanced discussion by adding a table that addresses the redemption of preferred stock, including payment of excise taxes.
Convertible Preferred Stock That Contains a Separately Classified Equity Component
Deleted discussion of beneficial conversion features.
Redemption of Common Stock
Enhanced discussion of the repurchase of stock for an amount that exceeds the quantity repurchased times the quoted price. Amended Example 3-22.
Excise Tax Obligations Arising From the Repurchase of Common Stock
Added guidance on excise tax obligations incurred in conjunction with the repurchase of common stock.
Freestanding Equity-Classified Contracts Indexed to an Entity’s Preferred Stock
Deleted discussion of contracts that contain a beneficial conversion feature.
Convertible Debt That Contains a Separately Classified Equity Component Indexed to an Entity’s Common Stock
Deleted discussion of convertible debt instruments that contain a beneficial conversion feature and that are accounted for in accordance with the cash conversion subsections of ASC 470-20, which have been rescinded from U.S. GAAP.
Convertible Preferred Stock That Contains a Separated Equity Component Indexed to an Entity’s Common Stock
Removed discussion of convertible preferred stock that contains a beneficial conversion feature and made conforming amendments to the remaining guidance.
Down-Round Features in Freestanding Financial Instruments
Removed discussion of the accounting before ASU 2020-06.
Modification or Exchange of Other Potential Common Stock
Updated Table 3-8 to remove discussion of the accounting before ASU 2021-04.
Reclassification of Other Potential Common Stock
Amended Table 3-9 to remove discussion of the cash conversion subsections of ASC 470-20, which were rescinded by ASU 2020-06.
Retirement-Eligible Employees
Added guidance on inclusion of shares in the denominator of basic EPS in situations in which the shares will vest when an employee becomes eligible to retire.
Contingently Issuable Shares
Clarified that shares issuable solely upon the passage of time are not contingently issuable and added guidance on what constitutes a contingently issuable share under ASC 260.
Background
Removed discussion of accounting before adoption of ASU 2020-06.
Scope
Removed discussion of accounting before adoption of ASU 2020-06.
Application of the Treasury Stock Method
Removed discussion of accounting before adoption of ASU 2020-06 throughout this entire section.
Examples
Updated Examples 4-3, 4-4, 4-6, and 4-7 to remove discussion of accounting before ASU 2020-06.
Scope
Removed discussion of accounting before adoption of ASU 2020-06.
Application of the Reverse Treasury Stock Method
Removed discussion of accounting before adoption of ASU 2020-06 throughout this entire section.
Prepaid Contracts
Amended guidance on the effect of prepaid written put options on diluted EPS.
Scope
Removed discussion of accounting before adoption of ASU 2020-06.
Application of the If-Converted Method
Removed discussion of accounting before adoption of ASU 2020-06 throughout this entire section.
Examples
Removed discussion of accounting before adoption of ASU 2020-06 from Example 4-13.
Method of Settlement
Removed discussion of accounting before adoption of ASU 2020-06.
General
Removed discussion of accounting before adoption of ASU 2020-06.
Examples
Clarified Example 4-19 and removed discussion of accounting before adoption of ASU 2020-06 from Example 4-20.
Contracts That May Be Settled in Stock or Cash
Removed discussion of accounting before adoption of ASU 2020-06 throughout this entire section.
Distributions That Are Considered Issuances of Common Stock
Removed discussion of accounting before adoption of ASU 2020-06.
If-Converted Method
Removed discussion of accounting before adoption of ASU 2020-06.
Contracts That May Be Settled in Cash or Stock
Removed discussion of accounting before adoption of ASU 2020-06 and clarified the application of the numerator and denominator adjustments.
General
Removed discussion of accounting before adoption of ASU 2020-06.
Basic EPS
Deleted discussion of convertible debt instruments with beneficial conversion features from Table 6-1.
Background
Removed discussion of accounting before adoption of ASU 2020-06.
Basic EPS
Removed discussion of accounting before adoption of ASU 2020-06.
Diluted EPS
Removed discussion of accounting before adoption of ASU 2020-06 and deleted guidance that is no longer relevant after adoption of ASU 2020-06.
Diluted EPS
Removed discussion of accounting before adoption of ASU 2020-06.
Stock-Settled Debt
Removed discussion of accounting before adoption of ASU 2020-06.
Diluted EPS
Removed discussion of accounting for Instruments C and X before adoption of ASU 2020-06.
Embedded Conversion Option Is Separated Under ASC 815-15
Removed discussion of accounting before adoption of ASU 2020-06.
Convertible Debt Instrument Recognized at Fair Value
Removed discussion of accounting before adoption of ASU 2020-06.
Embedded Put Options
Removed discussion of accounting before adoption of ASU 2020-06.
Embedded Call Options
Removed discussion of accounting before adoption of ASU 2020-06.
Share-Based Payment Awards
Added Connecting the Dots to address share awards to employees who are eligible for retirement.
Settlement in Shares or Cash
Removed discussion of accounting before adoption of ASU 2020-06.
Diluted EPS
Amended discussion to reflect adoption of ASU 2020-06.
Convertible Preferred Stock
Removed discussion of accounting before adoption of ASU 2020-06.
Distributions That Are Considered Issuances of Common Stock
Amended Example 8-4 to remove discussion of accounting before adoption of ASU 2020-06.
EPS Accounting
Removed discussion of accounting before adoption of ASU 2020-06.
Convertible Debt
Removed discussion of disclosures before adoption of ASU 2020-06.
Differences Between U.S. GAAP and IFRS Accounting Standards
Updated to reflect the elimination of U.S. GAAP guidance before the adoption of ASU 2020-06 and made other changes.
Pro Forma EPS in SEC Filings
Removed discussion of considerations before adoption of ASU 2020-06 and the impact of SEC Final Rule 33-10786, which is effective for all entities.