FASB issues a new Accounting Standards Update
The Financial Accounting Standards Board (FASB) recently issued Accounting Standards Update (ASU) 2011-04 Fair Value Measurement (Topic 820). This ASU is the result of the FASB and the International Accounting Standards Board’s (IASB) commitment to work together to create a common set of global accounting standards. This ASU was written to ensure that fair value has the same meaning in U.S. Generally Accepted Accounting Principles (GAAP) and in International Financial Reporting Standards (IFRS), and that fair value measurement and disclosure requirements are the same in substance.
This ASU explains how to measure fair value. It does not require additional fair value measurements, establish fair value standards, or affect valuation practices outside of financial reporting. This ASU applies to all reporting entities that are required or permitted to measure or disclose the fair value of an asset, liability, or an instrument classified in their equity.
Amendments contained within the ASU include:
The ASU is to be applied prospectively. For public entities, it is effective during interim and annual periods beginning after December 15, 2011. For nonpublic entities, it is effective for annual periods beginning after December 15, 2011. Early application by public entities is not permitted. Nonpublic entities may apply the ASU early, but no earlier than for interim periods beginning after December 15, 2011.
If you would like more information regarding this Accounting Standards Update, please contact the expert listed below at (800) 270-9629.
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