Summary of Board decisions are provided for the information and convenience of constituents who want to follow the Board’s deliberations. All of the conclusions reported are tentative and may be changed at future Board meetings. Decisions are included in an Exposure Draft for formal comment only after a formal written ballot. Decisions in an Exposure Draft may be (and often are) changed in redeliberations based on information provided to the Board in comment letters, at public roundtable discussions, and through other communication channels. Decisions become final only after a formal written ballot to issue an Accounting Standards Update.

April 20, 2011 FASB Board Meeting

Accounting for financial instruments. The Board discussed the classification and measurement of debt instruments that qualify for the amortized cost category at initial recognition but are subsequently identified for sale. The Board decided that in such circumstances an entity should continue to classify and measure the financial assets at amortized cost (less impairments) and recognize resulting gains, if any, only when the sale is complete. Additionally, the Board decided that in developing an overall impairment model for financial instruments, impairment for financial assets subsequently identified for sale should be recognized in earnings in an amount equal to the entire difference between the instrument’s amortized cost basis and its fair value.

The Board also discussed situations in which an entity anticipates that a portion of a pool of similar assets will be sold while the other portion will continue to be managed through its customer financing (lending) activities. However, the individual assets that will be subsequently sold are not specifically identified for sale at initial recognition. The Board reemphasized that in these circumstances an entity must classify and measure all financial instruments according to one of its defined business activities when applying the business strategy criterion. An entity would not be prevented from managing the same or similar financial instruments through different business activities.