Project Update
The Liquidation Basis of Accounting
Last updated on April 22, 2013.
(Updated sections are indicated with an asterisk *)
Project Objective
*Due Process Documents
*Decisions Reached at 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 project is to provide guidance about when and how an entity should apply the liquidation basis of accounting.*Due Process Documents
On April 22, 2013, the FASB issued Accounting Standards Update No. 2013-07, Presentation of Financial Statements (Topic 205): The Liquidation Basis of Accounting.Download ASU 2013-07
Read the FASB News Release that introduced the Update
Read the FASB In Focus that summarizes the Update
Read the Comment Letter Summary for the Proposed Update
*Decisions Reached at Last Meeting (February 13, 2013)
See Board Meeting Minutes below.*Summary of Decisions Reached to Date
See Accounting Standards Update No. 2013-07*Next Steps
NoneBoard/Other Public Meeting Dates
The following are links to the minutes for each meeting.
| February 13, 2013 | Board Meeting—Scope, recognition and measurement, transition, and due process matters |
| December 12, 2012 | Board Meeting—Recognition and Measurement |
| November 6, 2012 | Board Meeting—Comment Letter Summary |
| May 2, 2012 | Board Meeting—Liquidation Basis of Accounting and Project Objective |
| February 15, 2012 | Board Meeting—Liquidation Basis of Accounting |
| January 11, 2012 | Board Meeting—Project Scope and Objective |
| October 26, 2011 | Board Meeting—Project Scope and Objectives |
| December 1, 2010 | Board Meeting—Subsequent Events and Limited Life Entities |
| November 10, 2010 | Board Meeting—Issues Raised by External Reviewers |
| March 31, 2010 | Board Meeting—Disclosure Threshold and Liquidation Basis |
| January 13, 2010 | Board Meeting—Project Scope |
| June 3, 2009 | Board Meeting—Analysis of Additional Constituent Outreach |
| February 18, 2009 | Board Meeting—Comment Letter Discussion |
| August 27, 2008 | Board Meeting—Codification Discussion |
| September 19, 2007 | Board Meeting—Removal from Board agenda |
| May 30, 2007 | Board Meeting—Add Project to Board agenda |
Background Information
The U.S. guidance for when and how to apply the liquidation basis of accounting is located in the AICPA Statement on Auditing Standards No. 1, Codification of Auditing Standards and Procedures, Section 9508, “Reports on Audited Financial Statements: Auditing Interpretations of Section 508,” and states that a liquidation basis of accounting may be considered GAAP for entities in liquidation or for which liquidation appears imminent. The objective of the liquidation basis of accounting is to provide financial statement users with relevant information about an entity’s resources and obligations by measuring and presenting assets and liabilities in the entity’s financial statements at the estimated amount of cash the entity expects to collect or the amount of cash the entity expects to pay to settle its obligations during the course of liquidation. Some constituents have expressed a need for accounting literature in this area because there is currently diversity in practice.
*Contact Information
Brian NorthProject Manager
bnorth@fasb.org
Libby Van Wagenen
Postgraduate Technical Assistant
lvanwagenen@fasb.org
Diane Liu
XBRL Project Research Associate
dliu@fasb.org