8.1 Overview
As noted in Chapter 5, in the
period in which a component meets the criteria in ASC 205-20 for presentation as a
discontinued operation, a registrant must present the component as a discontinued
operation retrospectively for all prior periods presented. Accordingly, SEC
registrants must consider the impact of the retrospective change on the historical
financial statements included in their Exchange Act reports (e.g., Forms 10-K and
10-Q), registration statements under the Securities Act (e.g., registration
statements on Form S-3), and other nonpublic offerings. Registrants may also be
required to report a disposition, including certain disposals that do not qualify as
discontinued operations,1 on a Form 8-K and provide pro forma financial
information that gives effect to the disposition. Further, registrants must consider
the impact the revised financial statements may have on other SEC requirements
(e.g., SEC Regulation S-X, Rules 3-05, 3-09, 4-08(g), and 3-10). In addition,
registrants undertaking an initial public offering may be able to consider using a
“to-be-issued” accountant’s report in certain specific circumstances.
Footnotes
1
When either a subsidiary is deconsolidated or a group of
assets is derecognized, SEC registrants may be required to report the
deconsolidation or derecognition on a Form 8-K and provide pro forma
financial information that gives effect to the deconsolidation or
derecognition. For more information, see Section F.4 of Deloitte’s Roadmap
Consolidation —
Identifying a Controlling Financial Interest.