At its October 11, 2023, meeting, the FASB discussed its projects on (1) improvements
to the guidance on hedge accounting and (2) accounting for environmental credit
The Board made tentative decisions related to two issues addressed in its
November 2019 proposed Accounting Standards Update (ASU) Codification
Improvements to Hedge Accounting: (1) dual hedging relationships and (2)
use of the term “prepayable” in applying the shortcut method. In addition, the
Board addressed a third issue, net option written options on hedging
instruments, that has arisen in connection with the cessation of LIBOR. The
Board plans to discuss the remaining issues within the scope of the hedge
accounting improvements project at a future meeting.
Accounting for Environmental Credit Programs
Recognition and measurement reassessment requirements related to environmental
The Board discussed the staff’s research and outreach related to this project and
made tentative decisions about the project’s scope as well as about the
recognition and measurement of environmental credits. Specific topics the Board
addressed included the following:
Which assets and liabilities are within the project’s scope.
Recognition, initial measurement, and subsequent measurement of assets
related to environmental credits.
Application of the costing method and portfolio approach to