FASB Holds October 16 Meeting

At its October 16, 2024, meeting, the FASB discussed the Private Company Council’s (PCC’s) projects related to the following:

• Presentation of contract assets and contract liabilities for construction contractors — The Board endorsed the PCC’s decisions regarding its alternative (including the alternative’s scope, disclosure, and transition) for private companies’ presentation of contract assets and contract liabilities. The Board has directed the staff to draft a proposed Accounting Standards Update (ASU) on this topic for a vote by written ballot.
• Application of guidance on credit losses to ASC 606 receivables — The Board endorsed the PCC’s decision to allow “private companies and not-for-profit entities excluding not-for-profit conduit bond obligors” to use a simplified approach in applying the guidance in ASC 326 on credit losses to “current accounts receivable and contract asset balances” associated with transactions accounted for under the revenue guidance in ASC 606. Entities that qualify for the approach would be able to elect a “recognition and measurement practical expedient.” The Board has directed the staff to draft a proposed ASU on this topic for a vote by written ballot.

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