FASB Holds November 1 Meeting

At its November 1, 2023, meeting, the FASB discussed comments received on its proposed Accounting Standards Update (ASU) Scope Application of Profits Interest Awards. In addition to deciding to amend the illustrative example in the proposed ASU, the Board made tentative decisions related to the proposal’s scope and applicability, transition (including disclosures) and effective date, and costs versus benefits. The Board has directed its staff to draft a final ASU on this topic for a vote by written ballot.

Also at this meeting, the FASB decided to add to its agenda a project on the accounting for government grants by business entities — specifically, how an entity would recognize, measure, and present such grants. The Board decided that a government grant should be recognized when it is probable that (1) the entity will comply with the conditions of the grant and (2) the grant will be received. The Board also discussed the project’s scope and tentatively decided that an entity would apply the guidance in (1) ASC 230 when presenting cash flows associated with the grants and (2) ASC 832 when providing disclosures related to grants within the scope of the project.

For more information, see the tentative Board decisions on the FASB’s Web site.