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.