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- Herausgeber: John Wiley & Sons
- Kategorie: Fachliteratur
- Serie: Wiley Regulatory Reporting
- Sprache: Englisch
The complete, cross-referenced GAAP guide, with illustrations, explanations, and examples
Wiley GAAP 2016 contains the most comprehensive coverage of all GAAP pronouncements in a single volume, providing professionals with a complete reference to the entire GAAP hierarchy. This new edition includes the latest updates to the standards, along with AICPA ASEC statements of position and a comprehensive cross-reference of accounting topics to the new FASB codification system. All pronouncements are fully explained in detail, including terminology, and practice exercises demonstrate real-world application. Each chapter includes a discussion of perspectives and issues, sources of GAAP, definitions, concepts, rules, and examples, with specific appendices where applicable. This useful guide contains numerous examples and illustrations, and all original pronouncements are referenced to the FASB Current Text.
GAAP is constantly being updated, and users require expert interpretation and explanation of relevant principles with every new pronouncement. This book provides clear, comprehensive guidance, including FASB Technical Bulletins, AcSEC Practice Bulletins, FASB Implementation Guides, and AICPA Statements of Position and Accounting Interpretations. Readers will:
- Refer to GAAP standards and ASEC statements
- Understand relevant terminology, concepts, and rules
- Study detailed examples to gain a solid working knowledge of the standards
- Gain confidence by practicing GAAP applications before using it in the field
This guide represents the most complete, comprehensive GAAP reference available, and the digital format allows for instant access to information through the point-and-click Index and Table of Contents. A thorough study and analysis of all US Generally Accepted Accounting Principles, Wiley GAAP 2016 is the essential reference.
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Veröffentlichungsjahr: 2015
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CONTENTS
Cover
Series Page
Title Page
Copyright
Preface
About the Author
Codification Taxonomy
Chapter 1: ASC 105 Generally Accepted Accounting Principles
Perspectives and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 2: ASC 205 Presentation of Financial Statements
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
ASC 205-30, Liquidation Basis of Accounting
Chapter 3: ASC 210 Balance Sheet
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 4: ASC 215 Statement of Shareholder Equity
Perspective and Issues
Chapter 5: Asc 220 Comprehensive Income
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 6: Asc 225 Income Statement
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 7: Asc 230 Statement of Cash Flows
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 8: ASC 235 Notes to Financial Statements
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 9: ASC 250 Accounting Changes and Error Corrections
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 10: ASC 255 Changing Prices
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 11: ASC 260 Earnings Per Share
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Comprehensive Example
Chapter 12: ASC 270 Interim Reporting
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Part I—Requirements Applicable to all Reporting Entities
Part II—Requirements Applicable to Public Reporting Entites
Chapter 13: ASC 272 Limited Liability Entities
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 14: ASC 274 Personal Financial Statements
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 15: ASC 275 Risks and Uncertainties
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 16: ASC 280 Segment Reporting
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 17: ASC 305 Cash and Cash Equivalents
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 18: ASC 310 Receivables
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 19: ASC 320 Investments—Debt and Equity Securities
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 20: ASC 323 Investments—Equity Method and Joint Ventures
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 21: ASC 325 Investments—Other
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 22: ASC 330 Inventory
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 23: ASC 340 Other Assets and Deferred Costs
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 24: ASC 350 Intangibles—Goodwill and Other
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 25: ASC 360 Property, Plant, and Equipment
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 26: ASC 405 Liabilities
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 27: ASC 410 Asset Retirement and Environmental Obligations
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 28: ASC 420 Exit or Disposal Cost Obligations
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 29: ASC 430 Deferred Revenue
Chapter 30: ASC 440 Commitments
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 31: ASC 450 Contingencies
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 32: ASC 460 Guarantees
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 33: ASC 470 Debt
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 34: ASC 480 Distinguishing Liabilities from Equity
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 35: ASC 505 Equity
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 36: ASC 605 Revenue Recognition
Revenue Recognition—General Principles
Long-Term Construction Contracts (ASC 605-35)
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Service Revenues (ASC 605-20 AND ASC 605-45)
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Sales When Collection is Uncertain
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Revenue Recognition When Right of Return Exists (ASC 605-15)
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Revenue Arrangements with Multiple Deliverables (ASC 605-25)
Perspective and Issues
Other Special Accounting and Reporting Issues
Appendix—Overview of ASC 6062
Chapter 37: ASC 705 Cost of Sales and Services
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 38: ASC 710 Compensation—General
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 39: ASC 712 Compensaton—Nonretirement Post-Employment Benefits
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 40: ASC 715 Compensation—Retirement Benefits
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 41: ASC 718 Compensation—Stock Compensation
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 42: ASC 720 Other Expenses
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 43: ASC 730 Research and Development
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 44: ASC 740 Income Taxes
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 45: Asc 805 Business Combinations
Perspective and Issues
Definitions of Terms
Concepts, Rules, And Examples
Chapter 46: ASC 808 Collaborative Arrangements
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 47: Asc 810 Consolidations
Perspective and Issues
Definitions of Terms
Consolidation Models—Introduction and Background
The Vie Model
Voting Interest Model
Chapter 48: ASC 815 Derivatives and Hedging
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 49: ASC 820 Fair Value Measurements
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 50: ASC 825 Financial Instruments
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 51: ASC 830 Foreign Currency Matters
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Accounts to be Remeasured Using Historical Exchange Rates
Chapter 52: ASC 835 Interest
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 53: ASC 840 Leases
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 54: ASC 845 Nonmonetary Transactions
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 55: ASC 850 Related-Party Disclosures
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 56: ASC 852 Reorganizations
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 57: ASC 853 Service Concession Arrangements
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 58: ASC 855 Subsequent Events
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 59: Asc 860 Transfers and Servicing
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Chapter 60: ASC 900S Specialized Industry GAAP
Contractors—Federal Government (ASC 912)
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Development Stage Enterprises (ASC 915)
Entertaintment—Broadcasters (ASC 920)
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Entertainment—Cable Television (ASC 922)
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Entertainment—Casinos (ASC 924)
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Entertainment—Film (ASC 926)
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Entertainment—Music (ASC 928)
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Extractive Activities—Oil and Gas (ASC 932)
Perspective and Issues
Concepts, Rules, and Examples
Financial Services—Depository and Lending (ASC 942)
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Financial Services—Insurance (ASC 944)
Perspective and Issues
Concepts, Rules, and Examples
Financial Services—Investment Companies (ASC 946)
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Financial Services—Mortgage Banking (ASC 948)
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Financial Services—Title Plant (ASC 950)
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Franchisors (ASC 952)
Perspective and Issues
Definitions of Terms
Concepts and Rules
Not-For-Profit Entities (ASC 958)
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Plan Accounting (ASC 960, ASC 962, ASC 965)
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Real Estate—General (ASC 970)
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Real Estate—Retail Land (ASC 976)
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Real Estate Time-Sharing Activities (ASC 978)
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Regulated Operations (ASC 980)
Perspective and Issues
Concepts, Rules, and Examples
Software (ASC 985)
Perspective and Issues
Definitions of Terms
Concepts, Rules, and Examples
Appendix A: Definitions of Terms
Appendix B: Disclosure Checklist for Commercial Businesses
Index
End User License Agreement
List of Tables
Table 1
Table 2
Table 3
Guide
Cover
Table of Contents
Begin Reading
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Wiley GAAP 2016
Interpretation and Application of Generally Accepted Accounting Principles
Joanne M. Flood
This edition first published 2016
© 2016 John Wiley & Sons Ltd
Copyright © by the American Institute of Certified Public Accountants, Inc. Several items were quoted or referred to with permission.
Portions of this book have their origin in copyrighted materials from the Financial Accounting Standards Board. These are noted by reference to the specific pronouncement except for the definitions introduced in bold type that appear in a separate section at the beginning of each chapter. Complete copies are available directly from the FASB. Copyright © by the Financial Accounting Standards Board, 401 Merritt 7, PO Box 5116, Norwalk, Connecticut 06856-5116, USA.
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ISBN 978-1-119-10606-7 (paperback)
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Preface
Wiley GAAP 2016: Interpretation and Application provides analytical explanations, copious illustrations, and nearly 300 examples of all current generally accepted accounting principles. The book integrates principles promulgated by the FASB in its Accounting Standards Codification.TM
This edition of Wiley GAAP is organized to align fully with the structure of the FASB Codification. Each chapter now begins with a list of the Subtopics included within the Topic, major scope and scope exceptions, technical alerts of FASB Updates, and an overview of the Topic. The remainder of each chapter contains a detailed discussion of the concepts and practical examples and illustrations. This organization facilitates the primary objective of the book—to assist financial statement preparers and practitioners in resolving the myriad practical problems faced in applying GAAP.
Meaningful, realistic examples abound, guiding users in the application of GAAP to complex fact situations that must be dealt with in the real world practice of accounting. In addition to this emphasis, a major strength of the book is that it explains the theory of GAAP in sufficient detail to serve as a valuable adjunct to accounting textbooks. Much more than merely a reiteration of currently promulgated GAAP, it provides the user with the underlying conceptual bases for the rules. It facilitates the process of reasoning by analogy that is so necessary in dealing with the complicated, fast-changing world of commercial arrangements and transaction structures. It is based on the author's belief that proper application of GAAP demands an understanding of the logical underpinnings of all its technical requirements.
As a bonus, a comprehensive disclosure checklist, following the main text, offers practical guidance to preparing financial statements for commercial entities in accordance with GAAP. For easy reference and research, the checklist follows the order of the codification.
The following FASB Accounting Standards Updates were issued through May 2015 and since the Wiley GAAP 2015. Their requirements are incorporated in this edition of Wiley GAAP, as and where appropriate and at a minimum in the Technical Alert section at the beginning of the Topic referenced in the ASU title. Note that information on ASU 2014-09 is included as an appendix to the chapter on ASC 605.
ASU 2014-10,
Development Stage Entities (Topic 915): Elimination of Certain Financial Reporting Requirements, Including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation
ASU 2014-11,
Transfers and Servicing (Topic 860): Repurchase-to-Maturity Transactions, Repurchase Financings, and Disclosures
ASU 2014-12,
Compensation—Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be achieved After the Requisite Service Period
ASU 2014-13,
Consolidation (Topic 810): Measuring the Financial Assets and the Financial Liabilities of a Consolidated Collateralized Financing Entity (a consensus of the FASB Emerging Issues Task Force)
ASU 2014-14,
Receivables—Troubled Debt Restructurings by Creditors (Subtopic 310-40): Classification of Certain Government-Guaranteed Mortgage Loans upon Foreclosure (a consensus of the FASB Emerging Issues Task Force)
ASU 2014-15,
Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern
ASU 2014-16,
Derivatives (Topic 815): Determining Whether the Host Contract in a Hybrid Financial Instrument Issued in the Form of a Share Is More Akin to Debt or to Equity
ASU 2014-17,
Business Combinations (Topic 805) Pushdown Accounting
ASU 2014-18,
Business Combinations (Topic 805): Accounting for Identifiable Intangible Assets in a Business Combination
ASU 2015-01,
Income Statement—Extraordinary and Unusual Items (Subtopic 225-20): Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items
ASU 2015-02,
Consolidation (Topic 815): Amendments to the Consolidation Analysis
ASU 2015-03,
Interest—Imputation of Interest (Topic 835): Simplifying the Presentation of Debt Issuance Costs
ASU 2015-04,
Compensation—Retirement Benefits (Topic 715): Practical Expedient for the Measurement Date of an Employee's Defined Benefit Obligations and Plan Assets
ASU 2015-05,
Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 650-40) Customer's Accounting for Fees Paid in a Cloud Computing Arrangement
ASU 2015-06,
Earnings Per Share (Topic 260): Effects on Historical Earnings per Unit of Mater Limited Partnership Dropdown Transactions
ASU 2015-07,
Fair Value Measurement (Topic 820): Disclosure for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent)
ASU 2015-08,
Business Combinations (Topic 805): Pushdown Accounting—Amendments to SEC Paragraphs Pursuant to Staff Accounting Bulletin No. 115
ASU 2015-09,
Financial Services—Insurance (Topic 944): Disclosures about Short-Duration Contracts
Significant accounting changes are on the horizon. In the next year, the FASB is expected to make strides on the following major projects and others:
Leases
Revenue Recognition—deferral of the effective date,
1
Revenue Recognition—identifying performance obligations and licenses
Revenue Recognition—narrow scope improvements and practical expedients
Simplifying the subsequent measurement of inventory
Financial Instruments—Classification and measurement
Financial Instruments—Impairment
Financial Statements of Not-for-Profit Entities
Readers are encouraged to check the FASB website for status updates to the above and other FASB projects.
In response to the 2011 report of the Blue Ribbon Panel on Standard Setting for Private Companies, the AICPA and the FASB began separate initiatives. In July 2013, the AICPA released its Financial Reporting Framework for Small- and Medium-sized Entities. The AICPA has positioned the Framework as an alternative to U.S. GAAP and one that will provide consistent, reliable information for small- and medium-sized entities that are not required to prepare financial statements in accordance with U.S. GAAP. The FASB created the Private Company Council to address the Blue Ribbon Panel's report. The FASB issued a framework for the FASB and the PCC to use in determining whether alternatives to existing and proposed U.S. GAAP are warranted for private companies. In 2014, FASB issued three ASUs that are consensuses of the PCC. Those are listed on the table above.
The author's wish is that this book will serve preparers, practitioners, faculty, and students, as a reliable reference tool to facilitate their understanding of, and ability to apply, the complexities of the authoritative literature.
Joanne M. Flood
June 2015
Note
1.
The FASB issued an ASU to defer the effective date. For more information on this and the other revenue recognition projects, please see the Appendix to the Chapter on ASC 605.
About the Author
Joanne M. Flood, CPA, is an author and independent consultant on accounting and auditing technical topics and e-learning. She has experience as an auditor in both an international firm and a local firm and worked as a senior manager in the AICPA's Professional Development group. She received her MBA Summa Cum Laude in Accounting from Adelphi University and her Bachelor's degree in English from Molloy College.
While in public accounting, Joanne worked on major clients in retail, manufacturing, and finance and on small business clients in construction, manufacturing, and professional services. At the AICPA, Joanne developed and wrote e-learning, text, and instructor-led training courses on U.S. and International Standards. She also produced training materials in a wide variety of media, including print, video, and audio, and pioneered the AICPA's e-learning product line. Joanne resides on Long Island, New York with her daughter, Elizabeth. Joanne is the author of several articles for and contributor to Wiley Insight IFRS and the following Wiley publications:
Financial Disclosure Checklist
Wiley GAAP 2016: Interpretation and Application of Generally Accepted Accounting Principles
Wiley Practitioner's Guide to GAAS 2015: Covering all SASs, SSAEs, SSARSs, and Interpretations
Wiley GAAP: Financial Statement Disclosures Manual (Wiley Regulatory Reporting)
Wiley Revenue Recognition
And the following AICPA online and live CPE programs:
Audit Staff Essentials, Level 1 – New Hire
Audit Staff Essentials, Level 2 – Experienced Staff
Audit Staff Essentials, Level 3 – Audit Senior/In-Charge
Codification Taxonomy
Topic # and title
Subtopic # and title
I. General Principles and Objectives
105
Generally Accepted Accounting Principles
105-10
Overall
II. Overall Financial Reporting, Presentation, and Display Matters
A. Overall Presentation of Financial Statements
205
Presentation of Financial Statements
205-10
Overall
205-20
Discontinued Operations
205-30
Liquidation Basis of Accounting
205-40
Going Concern
210
Balance Sheet
210-10
Overall
210-20
Offsetting
215
Statement of Shareholders' Equity
215-10
Overall
220
Comprehensive Income
220-10
Overall
225
Income Statement
225-10
Overall
225-20
Extraordinary and Unusual Items
225-30
Business Interruption Insurance
230
Statement of Cash Flows
230-10
Overall
235
Notes to Financial Statements
235-10
Overall
B. Various Financial Reporting, Presentation, and Display Matters
250
Accounting Changes and Error Corrections
250-10
Overall
255
Changing Prices
255-10
Overall
260
Earnings Per Share
260-10
Overall
270
Interim Reporting
270-10
Overall
270-40
Income Taxes
272
Limited Liability Entities
272-10
Overall
274
Personal Financial Statements
274-10
Overall
275
Risks and Uncertainties
275-10
Overall
280
Segment Reporting
280-10
Overall
III. Transaction-Related Topics
A. Financial Statement Accounts
305
Cash and Cash Equivalents
305-10
Overall
310
Receivables
310-10
Overall
310-20
Nonrefundable Fees and Other Costs
310-30
Loans and Debt Securities Acquired with Deteriorated Credit Quality
310-40
Troubled Debt Restructurings by Creditors
320
Investments—Debt and Equity Securities
320-10
Overall
323
Investments—Equity Method and Joint Ventures
323-10
Overall
323-30
Partnerships, Joint Ventures, and Limited Liability Entities
325
Investments—Other
325-10
Overall
325-20
Cost Method Investments
325-30
Investments in Insurance Contracts
325-40
Beneficial Interests in Securitized Financial Assets
330
Inventory
330-10
Overall
340
Other Assets and Deferred Costs
340-10
Overall
340-20
Capitalized Advertising Costs
340-30
Insurance Contracts that Do Not Transfer Insurance Risk
340-40
Contracts with Customers
350
Intangibles—Goodwill and Other
350-10
Overall
350-20
Goodwill
350-30
General Intangibles Other Than Goodwill
350-40
Internal-Use Software
350-50
Web Site Development Costs
360
Property, Plant, and Equipment
360-10
Overall
360-20
Real Estate Sales
405
Liabilities
405-10
Overall
405-20
Extinguishment of Liabilities
405-30
Insurance-Related Assessments
405-40
Obligations Resulting from Joint and Several Liabilities
410
Asset Retirement and Environmental Obligations
410-10
Overall
410-20
Asset Retirement Obligations
410-30
Environmental Obligations
420
Exit or Disposal Cost Obligations
420-10
Overall
430
Deferred Revenue
430-10
Overall
440
Commitments
440-10
Overall
450
Contingencies
450-10
Overall
450-20
Loss Contingencies
450-30
Gain Contingencies
460
Guarantees
460-10
Overall
470
Debt
470-10
Overall
470-20
Debt with Conversion and Other Options
470-30
Participating Mortgage Loans
470-40
Product Financing Arrangements
470-50
Modifications and Extinguishments
470-60
Troubled Debt Restructurings by Debtors
480
Distinguishing Liabilities from Equity
480-10
Overall
505
Equity
505-10
Overall
505-20
Stock Dividends and Stock Splits
505-30
Treasury Stock
505-50
Equity-Based Payments to Non-Employees
505-60
Spin-offs and Reverse Spin-offs
605
Revenue Recognition
605-10
Overall
605-15
Products
605-20
Services
605-25
Multiple-Element Arrangements
605-28
Milestone Method
605-30
Rights to Use
605-35
Construction-Type and Production-Type Contracts
605-40
Gains and Losses
605-45
Principal–Agent Considerations
605-50
Customer Payments and Incentives
606
Revenue from Contracts with Customers
606-10
Overall
1
610
Other Income
610-10
Overall
1
610-20
Gains and Losses from the Derecognition of Nonfinancial Assets
610-30
Gains and Losses on Involuntary Conversions
705
Cost of Sales and Services
705-10
Overall
705-20
Accounting for Consideration Received from a Vendor
1
710
Compensation—General
710-10
Overall
712
Compensation—Nonretirement Postemployment Benefits
712-10
Overall
715
Compensation—Retirement Benefits
715-10
Overall
715-20
Defined Benefit Plans—General
715-30
Defined Benefit Plans—Pensions
715-60
Defined Benefit Plans—Other Postretirement
715-70
Defined Contribution Plans
715-80
Multiemployer Plans
718
Compensation—Stock Compensation
718-10
Overall
718-20
Awards Classified as Equity
718-30
Awards Classified as Liabilities
718-40
Employee Stock Ownership Plans
718-50
Employee Share Purchase Plans
718-740
Income Taxes
720
Other Expenses
720-10
Overall
720-15
Start-Up Costs
720-20
Insurance Costs
720-25
Contributions Made
720-30
Real and Personal Property Taxes
720-35
Advertising Costs
720-40
Electronic Equipment Waste Obligations
720-45
Business and Technology Reengineering
720-50
Fees Paid to the Federal Government by Pharmaceutical Manufacturers and Health Insurers
730
Research and Development
730-10
Overall
730-20
Research and Development Arrangements
740
Income Taxes
740-10
Overall
740-20
Intraperiod Tax Allocation
740-30
Other Considerations or Special Areas
B. Broad Transactional Categories
805
Business Combinations
805-10
Overall
805-20
Identifiable Assets and Liabilities, and Any Noncontrolling Interest
805-30
Goodwill or Gain from Bargain Purchase, Including Consideration Transferred
805-40
Reverse Acquisitions
805-50
Related Issues
805-740
Income Taxes
808
Collaborative Arrangements
808-10
Overall
810
Consolidation
810-10
Overall
810-20
Control of Partnerships and Similar Entities
810-30
Research and Development Arrangements
815
Derivatives and Hedging
815-10
Overall
815-15
Embedded Derivatives
815-20
Hedging—General
815-25
Fair Value Hedges
815-30
Cash Flow Hedges
815-35
Net Investment Hedges
815-40
Contracts in Entity's Own Equity
815-45
Weather Derivatives
820
Fair Value Measurements
820-10
Overall
825
Financial Instruments
825-10
Overall
825-20
Registration Payment Arrangements
830
Foreign Currency Matters
830-10
Overall
830-20
Foreign Currency Transactions
830-30
Translation of Financial Statements
830-230
Statement of Cash Flows
830-740
Income Taxes
835
Interest
835-10
Overall
835-20
Capitalization of Interest
835-30
Imputation of Interest
840
Leases
840-10
Overall
840-20
Operating Leases
840-30
Capital Leases
840-40
Sale-Leaseback Transactions
845
Nonmonetary Transactions
845-10
Overall
850
Related-Party Disclosures
850-10
Overall
852
Reorganizations
852-10
Overall
852-20
Quasi-Reorganizations
852-740
Income Taxes
853
Service Concession Arrangements
853-10
Overall
855
Subsequent Events
855-10
Overall
860
Transfers and Servicing
860-10
Overall
860-20
Sales of Financial Assets
860-30
Secured Borrowings and Collateral
860-40
Transfers to Qualifying Special-Purpose Entities
860-50
Servicing Assets and Liabilities
IV. Industry/Unique Topics
905
Agriculture
905-10
Overall
908
Airlines
908-10
Overall
910
Contractors—Construction
910-10
Overall
910-20
Contract Costs
912
Contractors—Federal Government
912-10
Overall
912-20
Contract Costs
915
Development Stage Entities
915-10
Overall
920
Entertainment—Broadcasters
920-10
Overall
922
Entertainment—Cable Television
922-10
Overall
924
Entertainment—Casinos
924-10
Overall
926
Entertainment—Films
926-10
Overall
926-20
Other Assets—Film Costs
928
Entertainment—Music
928-10
Overall
930
Extractive Activities—Mining
930-10
Overall
932
Extractive Activities—Oil and Gas
932-10
Overall
940
Financial Services—Brokers and Dealers
940-10
Overall
940-20
Broker Dealer Activities
942
Financial Services—Depository and Lending
942-10
Overall
944
Financial Services—Insurance
944-10
Overall
944-20
Insurance Activities
944-30
Acquisition Costs
944-40
Claim Costs and Liabilities for Future Policy Benefits
944-50
Policyholder Dividends
944-60
Premium Deficiency and Loss Recognition
944-80
Separate Accounts
946
Financial Services—Investment Companies
946-10
Overall
946-20
Investment Company Activities
948
Financial Services—Mortgage Banking
948-10
Overall
950
Financial Services—Title Plant
952
Franchisors
952-10
Overall
954
Health Care Entities
954-10
Overall
958
Not-for-Profit Entities
958-10
Overall
958-20
Financially Interrelated Entities
958-30
Split-Interest Arrangements
960
Plan Accounting—Defined Benefit Pension Plans
960-10
Overall
960-20
Accumulated Plan Benefits
960-30
Net Assets Available for Plan Benefits
960-40
Terminating Plans
962
Plan Accounting—Defined Contribution Pension Plans
962-10
Overall
962-40
Terminating Plans
965
Plan Accounting—Health and Welfare Benefit Plans
965-10
Overall
965-20
Net Assets Available for Plan Benefits
965-30
Plan Benefits Obligations
965-40
Terminating Plans
970
Real Estate—General
970-10
Overall
972
Real Estate—Common Interest Realty Associations
972-10
Overall
974
Real Estate—Real Estate Investment Trusts
974-10
Overall
976
Real Estate—Retail Land
976-10
Overall
978
Real Estate—Time-Sharing Activities
978-10
Overall
980
Regulated Operations
980-10
Overall
980-20
Discontinuation of Rate-Regulated Accounting
985
Software
985-10
Overall
985-20
Costs of Software to Be Sold, Leased, or Marketed
995
U.S. Steamship Entities
V. Glossary
Note
1.
ASU 2014-09 added this Codification section. For more information on ASU 2014-09, see the Appendix to the Chapter on ASC 606.
1ASC 105 Generally Accepted Accounting Principles
Perspectives and Issues
What is GAAP
Nonauthoritative Sources
Recognition Principles
Disclosure Principles
Definitions of Terms
Concepts, Rules, and Examples
History of GAAP
Other Sources
GAAP Codification
SEC Guidance in the Codification
Standards-Setting Process
Emerging Issues Task Force
Accounting Standards Updates
Maintenance Updates
American Institute of Certified Public Accountants
Researching GAAP Problems
Codification Structure
Research Procedures
Step 1: Identify the Problem
Step 2: Analyze the Problem
Step 3: Refine the Problem Statement
Step 4: Identify Plausible Alternatives
Step 5: Develop a Research Strategy
Step 6: Search Authoritative Literature
Step 7: Evaluation
Search Authoritative Literature (Step 6)—Further Explanation
Researching
Wiley GAAP
Researching Nonpromulgated GAAP
Internet-Based Research Sources
The Concept of Materiality
The Conceptual Framework
Components of the Conceptual Framework
CON 8—Chapter 1: The Objective of General Purpose Financial Reporting
CON 8—Chapter 3: Qualitative Characteristics of Useful Financial Information.
CON 5: Recognition and Measurement in Financial Statements of Business Enterprises
CON 6: Elements of Financial Statements
Definitions of Terms
Elements of Not-For-Profit Financial Statements
CON 7: Using Cash Flow Information and Present Value in Accounting Measurements
How CON 7 Measures Differ from Previously Utilized Present Value Techniques
Measuring Liabilities
Interest Method of Allocation
Accounting for Changes in Expected Cash Flows
Application of Present Value Tables and Formulas
Example of Present Value Calculation
Example of an Annuity Present Value Calculation
Example of the Relevance of Present Values
Practical Matters
Perspectives and Issues
What Is GAAP?
The FASB Accounting Standards CodificationTM (ASC) is the
…source of authoritative generally accepted accounting principles (GAAP) recognized by the FASB to be applied by nongovernmental entities. Rules and interpretive releases of the Securities and Exchange Commission (SEC) under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. In addition to the SEC's rules and interpretive releases, the SEC staff issues Staff Accounting Bulletins that represent practices followed by the staff in administering SEC disclosure requirements, and it utilizes SEC Staff Announcements and Observer comments made at Emerging Issues Task Force meetings to publicly announce its views on certain accounting issues for SEC registrants. ASC 105-10-05-1
In the absence of authoritative guidance, the FASB Codification (the Codification) offers the following approach.
If the guidance for a transaction or event is not specified within a source of authoritative GAAP for that entity, an entity shall first consider accounting principles for similar transactions or events within a source of authoritative GAAP for that entity and then consider nonauthoritative guidance from other sources. An entity shall not follow the accounting treatment specified in accounting guidance for similar transactions or events in cases in which those accounting principles either prohibit the application of the accounting treatment to the particular transaction or event or indicate that the accounting treatment should not be applied by analogy. ASC 105-10-05-2
Nonauthoritative Sources
The Codification lists some possible nonauthoritative sources:
Practices that are widely recognized and prevalent either generally or in the industry,
FASB Concepts Statements,
American Institute of Certified Public Accountants (AICPA) Issues Papers,
International Financial Reporting Standards of the International Accounting Standards Board,
Pronouncements of professional associations or regulatory agencies,
Technical Information Service Inquiries and Replies included in AICPA Technical Practice Aids,
Accounting textbooks, handbooks, and articles.(ASC 105-10-05-3)
GAAP establishes:
The measurement of economic activity,
The time when such measurements are to be made and recorded,
The disclosures surrounding this activity, and
The preparation and presentation of summarized economic information in the form of financial statements.
GAAP develops when questions arise about how best to accomplish those items. In response to those questions, GAAP is either prescribed in official pronouncements of authoritative bodies empowered to create it, or it originates over time through the development of customary practices that evolve when authoritative bodies fail to respond. Thus, GAAP is a reaction to and a product of the economic environment in which it develops. As such, the development of accounting and financial reporting standards has lagged the development and creation of increasingly intricate economic structures and transactions. There are two broad categories of accounting principles—recognition and disclosure.
Recognition Principles
Recognition principles determine the timing and measurement of items that enter the accounting cycle and impact the financial statements. These are quantitative standards that require economic information to be reflected numerically.
Disclosure Principles
Disclosure principles deal with factors that are not always quantifiable. Disclosures involve qualitative information that is an essential ingredient of a full set of financial statements. Their absence would make the financial statements misleading by omitting information relevant to the decision-making needs of the reader. Disclosure principles complement recognition principles by expanding on some quantitative data and explaining assumptions underlying the numerical information and providing additional information on accounting policies, contingencies, uncertainties, etc., which are essential to fully understand the performance and financial condition of the reporting enterprise.
Definitions of Terms
See Appendix A, Definitions of Terms, for terms related to this Topic: Conduit debt securities, Nongovernmental entity, and Nonpublic entity.
Concepts, Rules, and Examples
History of GAAP
From time to time, the bodies given responsibility for the promulgation of GAAP have changed, and indeed more than a single such body has often shared this responsibility. In response to the stock market crash of 1929, the AICPA appointed the Committee on Accounting Procedure. This was superseded in 1959 by the Accounting Principles Board (APB) created by the AICPA. Because of operational problems, in 1972 the profession replaced the APB with a three-part organization consisting of the Financial Accounting Foundation (FAF), Financial Accounting Standards Board (FASB), and the Financial Accounting Standards Advisory Council (FASAC). Since 1973 the FASB has been the organization designated to establish standards of financial reporting.
Other Sources
Not all GAAP has resulted from the issuance of pronouncements by authoritative bodies. For example, depreciation methods such as straight-line and declining balance have both long been acceptable. There are, however, no definitive pronouncements that can be found to state this. Furthermore, there are many disclosure principles that evolved into general accounting practice because they were originally required by the SEC in documents submitted to them. Even much of the content of statements of financial position and income statements has evolved over the years in the absence of adopted standards.
GAAP Codification
FASB's Codification became the single official source of authoritative, nongovernmental US generally accepted accounting principles. It superseded all nongrandfathered (see ASC 105-10-70-2 for a list of grandfathered guidance), non-SEC accounting guidance. Only one level of authoritative GAAP exists, excluding the guidance issued by the Securities and Exchange Commission (SEC). All other literature is nonauthoritative.
SEC Guidance in the Codification
To increase the utility of the Codification for public companies, relevant portions of authoritative content issued by the SEC and selected SEC staff interpretations and administrative guidance are included for reference in the Codification. The sources include:
Regulation S-X,
Financial Reporting Releases (FRR)/Accounting Series Releases (ASR),
Interpretive Releases (IR), and
SEC staff guidance in:
Staff Accounting Bulletins (SAB),
EITF Topic D and SEC Staff Observer comments.
The Codification does not, however, incorporate the entire population of SEC rules, regulations, interpretive releases, and staff guidance, such as content related to matters outside of the basic financial statements, including Management's Discussion and Analysis (MD&A), or to auditing or independence matters.
Standards-setting Process
The FASB has long adhered to rigorous “due process” when creating new guidance. The goal is to involve constituents who would be affected by the newly issued guidance so that the standards created will result in information that reports economic activity as objectively as possible without attempting to influence behavior in any particular direction. Ultimately, however, the guidance is the judgment of the FASB, based on research, public input, and deliberation.
The Board issues guidance through Accounting Standards Update (ASU) describing amendments to the Accounting Standards Codification. Once issued, the provisions become GAAP after the stated effective date.
Emerging Issues Task Force
The Emerging Issues Task Force (EITF) was formed in 1984 by the FASB to assist the Board in identifying current or emerging issues and implementation problems before divergent practices become entrenched. The guidance provided has often been restricted to narrow issues that were of immediate interest and importance.
If an EITF consensus is approved by the FASB, it amends the FASB Codification through an ASU.
Accounting Standards Updates
Accounting Standards Updates (ASUs) are composed of:
A summary of the key provisions of the project that led to the changes,
The specific changes to the Codification, and
The
Basis for Conclusions
.
The title of the combined set of new guidance and instructions is Accounting Standards Update YY-XX, where YY is the last two digits of the year and XX is the sequential number for each update. All authoritative GAAP issued by the FASB is issued in this format.
The FASB organizes the content of ASUs using the same Section headings as those used in the Codification. The ASU instructions display marked changes to the pertinent sections of the Codification. ASUs are not deemed authoritative in their own right; instead, they serve only to update the Codification and provide the historical basis for conclusions.
The content from updates that is not yet fully effective for all reporting entities appears in the Codification as boxed text and is labeled as pending content. The pending content text box includes the earliest transition date and a link to the related transition guidance, also found in the Codification.
Maintenance Updates
As with any publishing practice, irregularities occur. To make necessary corrections, the FASB staff issues Maintenance Updates. These are not addressed by the Board and contain nonsubstantive editorial changes and link-related changes.
American Institute of Certified Public Accountants
Although it currently plays a greatly reduced standard-setting role, the American Institute of Certified Public Accountants (AICPA) has authorized the Financial Reporting Executive Committee (FinREC) to determine the AICPA's policies on financial reporting standards and to speak for the AICPA on accounting matters. FinREC, formerly the Accounting Standards Executive Committee (AcSEC), is the senior technical committee at the AICPA. It is composed of seventeen volunteer members, representative of industry, analysts, and both national and regional public accounting firms.
Researching GAAP Problems
These procedures should be refined and adapted to each individual fact situation.
Codification Structure
The FASB Codification is located on fasb.org. The site is intended to be easily searchable for research purposes. This section provides an overview of the site's contents and search functionality.
Areas. On all pages of the site, all categories of the Codification are listed down the vertical menu bar on the left side of the page, revealing the following Areas, and the numbering series for each one:
General Principles (100) (Establishes the Codification as the source of GAAP.)
Presentation—(200) (Topics in this area relate only to presentation matters; they do not address recognition, measurement, and derecognition matters. Examples of these topics are income statement, balance sheet, and earnings per share.)
Assets (300).
Liabilities (400).
Equity (500).
Revenue (600).
Expenses (700). (Clusters all types of expense-related GAAP into five broad categories, which are cost of goods sold, research and development, compensation, income taxes, and other expenses.)
Broad Transactions (800). (Contains the major transactional topics, such as business combinations, derivatives, and foreign currency matters.)
Industry (900). (Itemizes GAAP for specific industries, such as entertainment, real estate, and software.)
Master Glossary.
Topics. The Codification content is arranged by Area and then further divided by Topics, Subtopics, Sections, and Subsections. FASB has developed a classification system specifically for the Codification. The following is the structure of the classifications system: XXX-YY-ZZ-PP, where
XXX = topic,
YY = subtopic,
ZZ = section, and
PP = paragraph.
