SUMMARY OF BOARD DECISIONS

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 a final standard.

May 21, 2009 FASB/IASB Joint Videoconference Board Meeting

Revenue recognition. The Boards discussed how an entity would measure its net contract position and recognize revenue when the customer promises an uncertain (variable) amount of consideration.

The Boards previously agreed that when the amount of consideration is uncertain (variable), the amount allocated to performance obligations would be the entity’s probability-weighted estimate of total consideration. However, the Boards did not agree on whether the amount recognized as revenue should ever be constrained.

At this meeting, the Boards tentatively agreed that revenue recognition should be constrained only if the consideration amount cannot be reliably estimated. The Boards directed the staff to develop proposed application guidance that an entity would use to determine whether an estimate is reliable. The Boards also asked the staff to develop potential disclosures that an entity might provide about contracts with uncertain consideration and the estimates reported in the financial statements.