Project Update

Investment Companies—Joint Project of the FASB and IASB

Last updated on March 14, 2013. Please refer to the Current Technical Plan for information about the expected release dates of exposure documents and final standards.

(Updated sections are indicated with an asterisk *)

This project update summarizes the project activities and decisions of the IASB and the FASB (Boards). It was prepared by the staff and is for the information and convenience of their constituents. All decisions of the Boards are tentative, may change at future Board meetings, and do not change current accounting and reporting requirements. Decisions of the Boards become final only after extensive due process.

Project Objective
Due Process Documents
IASB Due Process Documents
*Decisions Reached at the Last Meeting
*Summary of Decisions Reached to Date
*Next Steps
*Board/Other Public Meeting Dates
Background Information
Contact Information

Project Objective

The objective of this joint project is to provide comprehensive guidance for assessing whether an entity is an investment company and to provide measurement requirements for an investment company's investments.

Due Process Documents

On October 21, 2011, the FASB issued a proposed Accounting Standards Update, Financial Services—Investment Companies (Topic 946): Amendments to the Scope, Measurement, and Disclosure Requirements. The comment period ended on February 15, 2012.

IASB Due Process Documents

On October 31, 2012, the IASB issued Investment Entities (Amendments to IFRS 10, IFRS 12 and IAS 27).
Investment Entities

*Decisions Reached at the Last Meeting (March 13, 2013)

At its January 23, 2013 meeting, the Board directed the staff to perform outreach on the operationality of the tentative disclosure requirements about investments in another investment company. At today’s meeting, the Board discussed how to proceed on the project given the feedback it received.

The Board decided not to include in the final Accounting Standards Update disclosure guidance relating to when an investment company invests in another investment company but rather to address that guidance after the final Accounting Standards Update on investment companies is issued.

The Board directed the staff to draft a final Accounting Standards Update for vote by written ballot.

*Summary of Decisions Reached to Date (as of March 14, 2013)

Summary of Decisions Reached to Date During Redeliberations
 

*Next Steps

The Board directed the staff to draft a final Accounting Standards Update for vote by written ballot. The Board decided not to include guidance on the following issues in that final Accounting Standards Update:

  1. Disclosures about investments in another investment company
  2. Accounting for real estate property investments.
The Board plans to address disclosure requirements for investments in another investment company and the accounting for real estate property investments at a later date. The Board will consider feedback received on its Exposure Draft related to those issues when it continues redeliberations.

The Board also will revisit the accounting for real estate investment trusts (both mortgage and equity real estate investment trusts) when it discusses real estate specific issues at a later date.

The Board’s tentative disclosure requirements about investments in another investment company are summarized in the ‘Summary of Decisions Reached to Date During Redeliberations’ document above. The Board and staff performed outreach to obtain feedback on the operationality of those disclosure requirements. Read the summary of feedback received on the operationality of the tentative disclosure requirements.

*Board/Other Public Meeting Dates

The Board meeting minutes are provided for the information and convenience of constituents who want to follow the Board’s deliberations. All of the conclusions reported are tentative and may be changed at future Board meetings. Decisions become final only after a formal written ballot to issue a final standard.

March 13, 2013 FASB Board Meeting—Decisions about the next steps for disclosures about investments in another investment company.
January 23, 2013 FASB Board Meeting—Decisions about disclosures, transition requirements, and effective date.
December 12, 2012 FASB Board Meeting—Decisions about the next steps for real estate property investments.
September 5, 2012 FASB Board Meeting—Decision about the application of investment company guidance to mortgage real estate investment trusts
August 29, 2012 FASB Board Meeting—Decisions about consolidation of an investment company subsidiary and disclosures about investments in another investment company
August 8, 2012 FASB Board Meeting—Decision about investment companies regulated under the 1940 Act
July 16, 2012 Joint Board Meeting—Decisions about how an entity would determine whether it is an investment company
June 13, 2012 Joint Board Meeting—Decisions about the accounting by an investment company for an investment company subsidiary and the accounting by a noninvestment company parent for an investment company subsidiary
May 21, 2012 Joint Board Meeting—Decisions about the overall approach to assessing the criteria and the related implementation guidance to be an investment company
April 17, 2012 Joint Board Meeting—Summary of feedback received on the exposure drafts
March 27, 2012 Joint Roundtable Meeting (Kuala Lumpur)—Discussions about the exposure drafts
March 16, 2012 Joint Roundtable Meetings (Norwalk)—Discussions about the exposure drafts
February 29, 2012 Joint Roundtable Meeting (London)—Discussions about the exposure drafts
February 17, 2012 Joint Roundtable Meeting (Toronto)—Discussions about the exposure drafts
December 8, 2011 FASB Board Meeting—Decision to extend the comment period.
August 24, 2011 FASB Board Meeting—Decisions about rental revenue recognition.
August 10, 2011 FASB Board Meeting—Decisions about the criteria to be an investment company, changes in status, and interests in other entities.
July 13, 2011 FASB Board Meeting—Decisions about presentation, disclosures, and the comment period.
June 8, 2011 FASB Board Meeting—Decisions about interests in other entities.
October 13, 2010 FASB Board Meeting—Decisions about the criteria to be an investment company, the retention of specialized accounting, and transition.
June 1, 2010 Joint Board Meeting—Decisions about disclosures.
May 19, 2010 Joint Board Meeting—Decisions about the retention of specialized accounting.
May 4, 2010 Joint Board Meeting—Decisions about disclosures.
April 20, 2010 Joint Board Meeting—Decisions about the criteria to be an investment company, measurement, and transition.
February 17, 2010 Joint Board Meeting—Decisions about the criteria to be an investment company, measurement, and disclosures.

Background Information

The Board’s technical agenda previously included a long-term project to develop comprehensive guidance on accounting for affiliations between entities, including reconsideration of ARB No. 51, Consolidated Financial Statements. The IASB also had an active project on its agenda to reconsider its guidance in this area. In 2004, the IASB and the FASB agreed that an objective of both their projects was to develop a common, high-quality standard on consolidation policy. The Boards agreed that as part of the development of a consolidation standard, they would look to develop consistent criteria for qualifying as an investment company.

Contact Information

Upaasna Laungani
Project Manager
ulaungani@fasb.org

PROJECTS