Action Alert No. 08-32
August 7, 2008


(Board meetings are available by audio webcast and telephone.)

No Board meetings are planned for the weeks of August 11 and August 18, 2008. The next scheduled Board meeting is Wednesday, August 27, 2008.


Wednesday, August 13, 2008, 9:00 a.m.

The Board will hold an educational, non-decision-making session to discuss topics that are anticipated to be discussed at a future Board meeting. Those topics will be posted to the FASB calendar four days prior to the education session.


The Board Actions 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 Statement, Interpretation, FSP, or Statement 133 Implementation Issue.

July 30, 2008 Board Meeting

Reconsideration of Interpretation 46(R) and Statement 140 implementation: transfers of financial assets. The Board discussed the transition and effective date for the proposed amendments to FASB Statement No. 140, Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities, and FASB Interpretation No. 46 (revised December 2003), Consolidation of Variable Interest Entities. The Board unanimously decided to change its tentative decisions reached at the June 11, 2008 Board meeting regarding transition and effective date to a single effective date for fiscal years beginning after November 15, 2009. However, the Board also decided to separately issue an FSP that would require additional disclosures as soon as possible (see below).

The Board clarified that the initial consolidation of a variable interest entity as a result of the initial application of the proposed amendments to Interpretation 46(R) would require an enterprise to initially measure all assets and liabilities at fair value, with any difference being recorded as a cumulative-effect adjustment to retained earnings that would be recorded as of the beginning of the first fiscal year in which the proposed amendments are initially applied.

The Board decided that many of the disclosures approved for the proposed amendments to Statement 140 and Interpretation 46(R) at the June 4, 2008 Board meeting will be included in a separate FSP. In addition, the Board decided that the proposed FSP will require a nontransferor enterprise that holds a significant variable interest in a qualifying special-purpose entity to make certain disclosures required by the proposed amendments to the Interpretation 46(R) disclosures. The Board decided that the proposed FSP will be effective as soon as possible, but no later than the first interim reporting period in 2009. The Board also decided that the proposed FSP will only be applicable to public companies and that the exposure period for the proposed FSP will be 30 days. The purpose of a disclosure-only FSP is to meet financial statement users needs for greater transparency for off-balance-sheet transactions as well as to provide preparers and others with adequate time to consider and implement the other proposed amendments to Statement 140 and Interpretation 46(R).

The Board directed the staff to proceed to a draft of a proposed FSP for vote by written ballot.


Subsequent to the EITF Agenda Committee meeting on July 28, 2008, the FASB Chairman announced the following decisions on the proposed new issues:

  1. Consideration of the Effect of Statement 160 on Accounting for Freestanding Derivative Financial Instruments Indexed to, and Potentially Settled in, the Stock of a Consolidated Subsidiary—This issue was added to the EITF agenda.

  2. Accounting for Purchases and Sales of Partial Interests in a Subsidiary That Is in Substance Real Estate—This issue was not added to the EITF agenda.

  3. Consideration of the Effect of Statements 141(R) and 160 on Accounting for Equity Method Investments—This issue was added to the EITF agenda.


The following documents were issued and are available on the FASB website:

FSP FAS 117-1, Endowments of Not-for-Profit Organizations: Net Asset Classification of Funds Subject to an Enacted Version of the Uniform Prudent Management of Institutional Funds Act, and Enhanced Disclosures for All Endowment Funds (August 6, 2008).

Revised FASB Exposure Draft, Earnings per Share (August 7, 2008). Comments are requested by December 5, 2008.


The following is a list of open meetings tentatively scheduled through September. Because schedules may change, please check the FASB calendar before finalizing your plans. Revisions to this list since the last issue of Action Alert are highlighted in bold.

Wednesday, August 27, 2008—FASB Board Meeting
Wednesday, August 27, 2008—FASB Education Session
Wednesday, September 3, 2008—FASB Board Meeting
Wednesday, September 3, 2008—FASB Education Session
Monday, September 8, 2008—Liabilities and Equity Roundtable Meeting
Wednesday, September 10, 2008—FASB Board Meeting
Wednesday, September 10, 2008—Emerging Issues Task Force Meeting
Monday, September 15, 2008—Liaison Meeting with the AICPA Private Companies Practice Section, Technical Issues Committee
Wednesday, September 17, 2008—FASB Education Session
Thursday, September 18, 2008—FASB Board Meeting
Monday, September 22, 2008—Financial Accounting Standards Advisory Council Meeting
Tuesday, September 23, 2008—Financial Accounting Standards Advisory Council Meeting
Wednesday, September 24, 2008—FASB Board Meeting
Wednesday, September 24, 2008—Contingency Disclosures Roundtable, p.m.