Preface
Preface
We are pleased to present the 2023 edition of Earnings per
Share. This Roadmap provides an overview of the accounting and disclosure
guidance in ASC 2601 as well as insights into and interpretations of how to apply the guidance in
practice. In addition, the discussion is accompanied by excerpts from the related
authoritative text.
The calculation of EPS is a complex aspect of GAAP that is largely
governed by “rules-based” guidance developed over many years in response to requests
by constituents for interpretive guidance on certain narrow issues. The impact that
specific transactions or instruments have on EPS is often viewed as not necessarily
reflecting the economics of such transactions or instruments. Such complexity
affects preparers as well as users.
The 2023 update of this Roadmap contains new and expanded guidance on certain matters
related to calculating basic and diluted EPS. Note that in this edition, it is
assumed that an entity has already adopted ASU 2020-06 and ASU 2021-04. For a
listing of significant changes made since the issuance of the 2022 edition of this
publication, see Appendix F.
Be sure to check out On the
Radar (also available as a stand-alone publication),
which briefly summarizes emerging issues and trends related
to the accounting and financial reporting topics addressed
in the Roadmap.
We hope you find this Roadmap useful in navigating the EPS
accounting and disclosure guidance, reducing complexity, and arriving at appropriate
accounting conclusions. In addition, we welcome your suggestions for future
improvements to the publication. If you need assistance with applying the guidance
or have other questions about this topic, we encourage you to consult with our
technical specialists and other professional advisers.
Footnotes
1
For a list of abbreviations used in this publication, see
Appendix E.
For the full titles of standards, topics, and regulations used in this
publication, see Appendix
D.