Heads Up Newsletter

This Heads Up discusses FASB Accounting Standards Update (ASU) No. 2025-03, Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity, which amends the guidance in ASC 805. The ASU is intended to improve comparability between business combinations that involve variable interest entities and those that do not.

This Heads Up discusses an entity’s presentation and disclosure requirements upon its adoption of FASB Accounting Standards Update (ASU) No. 2023-09, Improvements to Income Tax Disclosures. The ASU, which the FASB issued in December 2023, requires entities to consistently categorize and provide greater disaggregation of information in the rate reconciliation. They must also further disaggregate income taxes paid.

This Heads Up discusses FASB Accounting Standards Update No. 2025-04, Clarifications to Share-Based Consideration Payable to a Customer, which clarifies the guidance in ASC 606 and ASC 718 on the accounting for share-based payment awards that are granted by an entity as consideration payable to its customer. The ASU is intended to reduce diversity in practice and improve existing guidance, primarily by revising the definition of a “performance condition” and eliminating a forfeiture policy election for service conditions associated with share-based consideration payable to a customer.

This Heads Up discusses the FASB’s proposed Accounting Standards Update issued on April 30, 2025, which would introduce an incremental framework to simplify the determination of whether contemporaneous exchanges of cash between a debtor and a creditor should be accounted for as extinguishments of debt under ASC 470-50. Under this framework, an issuer would be required to consider new criteria in ASC 470-50-40-9 before performing the 10 percent cash flow test under the current guidance in ASC 470-50-40-10 through 40-12A.

This Heads Up discusses the European Commission’s recent proposed omnibus legislation, which aims to significantly reduce the sustainability and due diligence reporting burdens for entities that are currently within the scope of the Corporate Sustainability Reporting Directive (CSRD), the EU Taxonomy (EUT), and the Corporate Sustainability Due Diligence Directive (CSDDD).

This Heads Up discusses the SEC’s recently issued SAB No. 122, which rescinds the guidance in SAB 121. SAB 121 previously required an entity to recognize a liability and corresponding asset for its obligation to safeguard crypto assets. The rescission of SAB 121 will have a significant impact on the financial statements of entities that were previously within the scope of SAB 121.