Tentative Board Decisions
Tentative Board decisions are provided for those interested in following
the Board’s deliberations. All of the reported decisions are tentative and may
be changed at future Board meetings.Wednesday, November 1,
2017 FASB Board Meeting
targeted improvements to the accounting for long-duration contracts. The
Board redeliberated the amendments in the proposed Accounting Standards Update,
Financial Services—Insurance (Topic 944): Targeted Improvements to the
Accounting for Long-Duration Contracts. The topics were presentation,
disclosures, and market risk benefits.
The Board decided the
- Market risk benefits should be presented separately in the statement of
financial position, and changes in fair value should be presented separately
in the statement of operations, except for changes in instrument-specific
credit risk, which should be presented separately in other comprehensive
- The adjustment relating to updating the liability for future policy
benefit measurement assumptions should be presented separately in the
statement of operations.
- The following additional disclosures should be required:
a.Information about gross premiums
b.Information about techniques used to determine
c.Premium deficiency testing
methodology and results.
- The following proposed disclosures should be removed:
a. Information about objectives, policies, and processes
including information about hedging activity
b.Ranges and weighted averages of inputs or assumptions (other than
discount rates) used in liability
c. Weighted-average rates earned from
the investment of policyholders’
account balance deposits
d. Information used to
conclude that no additional liability should be
recognized for universal life-type
- To affirm all other proposed disclosures.
- The proposed frequency of the following disclosure requirements should be
reduced to at least annually:
a. Information about
assumptions, changes in assumptions, and the
effect of those changes
b. The nature of capitalized costs
c. The entity’s accounting policy for sales
- The proposed transition disclosure requirements should be replaced. An
entity should be required to disclose:
rollforward of the pre-adoption transition date balances to
post-adoption transition date
b. Qualitative and quantitative information
about the effect of transition
The Board will
discuss the effective date at a future meeting. Also, the staff will perform
additional outreach to gather feedback on the recent changes to the disclosure
framework—Board’s decision process. The Board discussed issues related
to the proposed FASB Concepts Statement, Conceptual Framework for Financial
Reporting—Chapter 8: Notes to Financial Statements.
decided the following:
- The Concepts Statement would retain Appendix A,Decision Questions
to Be Considered in Establishing Disclosure Requirements, with additional
- Information about the potential effects of changes in (a) general economic
conditions or market factors or (b) entity- or sector-specific factors on a
line item should be removed from the chapter as disclosures that the Board
should consider in establishing disclosure requirements.
- Future-oriented information is acceptable for disclosure when it is
information about estimates and assumptions used as inputs to measurements; it
is not acceptable when it is information about the effect of specified future
changes in existing conditions on specific line items.
- The discussion of information about existing plans and strategies should
be limited to those that affect recognition and measurement.
- The Concepts Statement would retain the concepts on interim
- Information about past events and current conditions and circumstances
that can affect an entity’s cash flows and information about the reporting
entity are suitable for notes.
- The discussion of the assessment of cost should not be expanded.
- The concepts on the notes to financial statements, subject to decisions
made in redeliberations, are substantially complete.
The staff will draft the chapter and distribute that draft for
external review. Following external review, the staff will bring back any
additional issues. Also, the staff plans to redeliberate issues on materiality
at a future meeting.
improvements—elimination of U.S. steamship entities (Topic 995). The Board
redeliberated the amendments in the proposed Accounting Standards Update,
Technical Corrections and Improvements to Topic 995, U.S. Steamship
Entities: Elimination of Topic 995. The Board made the following
Elimination of Topic 995
The Board affirmed
its decision to supersede Topic 995, U.S. Steamship
The Board decided that the
effective date will be for annual and first interim periods beginning after
December 15, 2018, for all entities.
The Board decided that the amendments in the Update should be applied on a
modified retrospective basis. Additionally, entities should disclose the
amounts and types of temporary differences for which a deferred tax liability
had not been previously recognized. The Board decided that early adoption is
permitted for all entities, including adoption in an interim
The Board directed the staff to draft
a final Accounting Standards Update for vote by written