%PDF-1.7 % Reporting entities are required to describe all significant accounting policies in the financial statements. Your go-to resource for timely and relevant accounting, auditing, reporting and business insights. Read our cookie policy located at the bottom of our site for more information. Welcome to the Deloitte Accounting Research Tool (DART)! Discover how EY insights and services are helping to reframe the future of your industry. US pandemic response and relief funding proactively mitigating fraud, waste and abuse, The COO Imperative: How human emotions can unlock supply chain success, 2023 Global economic outlook: Transforming uncertainty into opportunity, Select your location Close country language switcher. However, liabilities recorded for contingencies may consist of numerous claims that are established and settled in multiple periods. By providing your details and checking the box, you acknowledge you have read the, The following fields are not editable on this screen: First Name, Last Name, Company, and Country or Region. The decision of whether to discount is a matter of accounting policy that should be consistently applied and disclosed. remember settings), Performance cookies to measure the website's performance and improve your experience, Marketing/Targeting cookies which are set by third parties with whom we execute marketing campaigns and allow us to provide you with content relevant to you. Your go-to resource for timely and relevant accounting, auditing, reporting and business insights. Review ourcookie policyfor more information. future events occur or fail to occur." In the life sciences industry, contingencies often arise as a result of product liability issues; patent litigation remember settings), Performance cookies to measure the website's performance and improve your experience, Marketing/Targeting cookies which are set by third parties with whom we execute marketing campaigns and allow us to provide you with content relevant to you. of Professional Practice, KPMG US. Refer to Appendix D of the publication for a summary of the updates. How do you move long-term value creation from ambition to action. Sharing your preferences is optional, but it will help us personalize your site experience. Follow along as we demonstrate how to use the site. What you need to know Merging with a special purpose acquisition company (SPAC) offers an alternative to an IPO for private companies that want to enter the public markets. 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Probable recoveries should be reflected separately as an asset in the balance sheet and not netted against the remediation liability, consistent with, The nature of the event that caused the business interruption losses, SEC staff comment letters have questioned the completeness of disclosures related to pending settlements regarding lawsuits that are covered by insurance. If some amount within the range of loss appears at the time to be a better estimate than any other amount within the range, that amount shall be accrued. For more information about our organization, please visit ey.com. 66~q Ckg /.vv q Terminology used shall be descriptive of the nature of the accrual, such as estimated liability or liability of an estimated amount. About EY . The services described herein are illustrative in nature and are intended to demonstrate our experience and capabilities in these areas; however, due to independence restrictions that may apply to audit clients (including affiliates) of Deloitte & Touche LLP, we may be unable to provide certain services based on individual facts and circumstances. Are you still working? See more on AccountingLink Subscribe to AccountingLink updates, Do Not Sell or Share My Personal Information. Please refer to your advisors for specific advice. Please see www.pwc.com/structure for further details. 2019 - 2023 PwC. includes examples to illustrate how these concepts may be applied in EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Affected companies will need to consider whether indicators of impairment exist for a variety of assets. One way to alleviate some of this tension is to aggregate losses. However, a change from discounting to not discounting because there has been a change in the facts and circumstances regarding the inherent predictability in the timing and amount of the payments is not considered a change in the method of applying an accounting principle. Roadmap: Contingencies, Loss Recoveries, and Guarantees (April 2022) By accessing this document, you acknowledge that use of this document is limited solely to you or your Company's internal purposes and, solely for the purposes of study, training, and research questions. %%EOF Select a section below and enter your search term, or to search all click Enabled by data and technology, our services and solutions provide trust through assurance and help clients transform, grow and operate. We bring together extraordinary people, like you, to build a better working world. hmo0?n:;T!+S)UCm 8 A %j$ c&%~Mh\v:S:{spEioDz Our FRD publication on ASC 606, Revenue from Contracts with Customers, has been updated to enhance and clarify our interpretative guidance. We use cookies to personalize content and to provide you with an improved user experience. Additional Resources. That assumption applies throughout the guide and will not be restated in every instance. edition of, Be sure to check out How do you move long-term value creation from ambition to action. Topics include: 1:22 - Background. This publication contains general information only and Deloitte is not, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. +1 212-954-1723. practice. You may withdraw your consent to cookies at any time once you have entered the website through a link in the privacy policy, which you can find at the bottom of each page on the website. :Uw#mA0 7:p3^dlnylE[yz~Cg=UlUmnapE>FW Wf:T5I+wG.>)g:/e? Nix3{t&p)1IuU.6f*#)D:n66~gKeb 130shnKI#+QP&DA)m*QCpXFr!H.O>ag`Rao#{dR`R`2y=7".n7= h}'VA"I Pdw2=W[xcoDD~hj2jAG|8c;klU;_ On June 1, 20X1, FSP Corp's equipment is heavily damaged while being transported from its manufacturing facility to its retail facility. 1404 0 obj <> endobj You can set the default content filter to expand search across territories. EY | Assurance | Consulting | Strategy and Transactions | Tax. Other reporting entities choose to include this information in a "Significant Accounting Policies" footnote, as described in. remember settings), Performance cookies to measure the website's performance and improve your experience, Marketing/Targeting cookies which are set by third parties with whom we execute marketing campaigns and allow us to provide you with content relevant to you. Handbook: Climate risk in the financial statements. The insights and quality services we deliver help build trust and confidence in the capital markets and in economies the world over. Financial reporting developments Exit or disposal cost obligations | 2 1.1 One-time termination benefits A one-time benefit arrangement is deemed to exist at the date the plan of termination meets certain criteria and has been communicated to employees (hereinafter referred to as the communication date). The insights and quality services we deliver help build trust and confidence in the capital markets and in economies the world over. Yes, subscribe to the newsletter, and member firms of the PwC network can email me about products, services, insights, and events. Overview. Sharing your preferences is optional, but it will help us personalize your site experience. copying, or printing. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. An entity may choose how to classify business interruption insurance recoveries in the statement of operations, as long as that classification is not contrary to existing generally accepted accounting principles (GAAP). A full set of financial statements for a period shall show all of the following: In any one year it is ordinarily desirable that the statement of financial position, the income statement, and the statement of changes in equity be presented for one or more preceding years, as well as for the current year. S-X 4-01 (a) (1) requires financial statements filed with the SEC to be presented in accordance with US GAAP, unless the SEC has indicated otherwise (e.g., foreign private issuers are permitted to use IFRS as issued by the IASB). EY | Assurance | Consulting | Strategy and Transactions | Tax. FSP Corp should write off the net book value of the equipment of $7 million and recognize an asset of $5 million for the probable recovery of its loss (a loss recovery asset on the balance sheet), resulting in a net initial loss of $2 million. If there is a decline in the net realizable value or utility of inventory, ASC 330, Inventory, requires the decline to be recognized as a charge in the period in which it occurs. Qualifying Emerging Growth Companies, as defined in the Jumpstart Our Business Startups (JOBS) Act, and Smaller Reporting Companies, as defined in S-K 10(f),are permitted to omit the earliest year income statement and statements of comprehensive income, cash flows, and changes in stockholders equityin an initial public offering. Overview. This material has been prepared for general informational purposes only and is not intended to be relied upon as accounting, tax, or other professional advice. Appendix A summarizes the updates.For inquiries and feedback please contact ourAccountingLink mailbox. contributions received by not-for-profits or ASC 450-30 for gain contingencies. Select a section below . . . You may withdraw your consent to cookies at any time once you have entered the website through a link in the privacy policy, which you can find at the bottom of each page on the website. Discover how EY insights and services are helping to reframe the future of your industry. h242R0P042V0Q& Before making any decision or taking any action that may affect your business, you should consult a qualified professional advisor. EY is a global leader in assurance, consulting, strategy and transactions, and tax services. You can set the default content filter to expand search across territories. As discussed in ASC 450-20-50-9, if a material loss contingency arises after the balance sheet date but before the financial statements are issued, disclosure may be necessary.  Jk Read our cookie policy located at the bottom of our site for more information. Asking the better questions that unlock new answers to the working world's most complex issues. EY | Assurance | Consulting | Strategy and Transactions | Tax. hbbd```b``5/@$= ,~D2m`R,~DE"`f0&d`"\A. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. This material has been prepared for general informational purposes only and is not intended to be relied upon as accounting, tax, or other professional advice. 2019 - 2023 PwC. Are you still working? Example FSP 23-1 illustrates the recognition, measurement, and disclosure of a loss of equipment with a potential insurance recovery. 1429 0 obj <>/Filter/FlateDecode/ID[<85E4F096D5BABB428511129BE0BA0CAD>]/Index[1404 40]/Info 1403 0 R/Length 119/Prev 658949/Root 1405 0 R/Size 1444/Type/XRef/W[1 3 1]>>stream The equipment had a net book value of $7 million and an estimated replacement value of $6 million as of the date of loss. 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