Summary of Board decisions 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 are included in an Exposure Draft for formal comment only after a formal written ballot. Decisions in an Exposure Draft may be (and often are) changed in redeliberations based on information provided to the Board in comment letters, at public roundtable discussions, and through other communication channels. Decisions become final only after a formal written ballot to issue an Accounting Standards Update.

July 25, 2012 FASB Board Meeting

Technical corrections. Several external reviewers of a draft of the final Update advised the Board that three amendments may have unintended financial reporting consequences. The Board considered that feedback and decided to remove those proposed amendments from the scope of this Technical Corrections and Improvements project so they could be further analyzed. Those amendments relate to (1) rabbi trusts (paragraph 96 of the proposed Update), (2) proportionate consolidation (paragraph 15), and (3) disclosure of net appreciation of net assets available for plan benefits (paragraphs 280, 282, 283, 290, and 293). After the additional analysis is complete, the Board will consider whether any changes would best be made through the next Technical Corrections and Improvements project, the Emerging Issues Task Force, or in some other way.

Insurance contracts. The FASB continued its discussions on insurance contracts by exploring two issues: whether title insurance contracts should be in the scope of the insurance contracts standard and the accounting treatment for direct-response advertising costs.

Title Insurance Contracts

The Board decided that title insurance contacts should be in the scope of the insurance contracts standard because they meet the tentative definition of an insurance contract. The Board decided that a title insurance carrier would unbundle a title insurance contract into a service component (a title search service component accounted for using the revenue recognition standard) and an insurance component (an indemnification component that covers title defects that would be accounted for using the insurance contracts standard). The Board decided to include a title insurance example in the application guidance to illustrate the requirement to unbundle a title contract into a service component and an insurance component.

Treatment of Direct Response Advertising Costs

The Board tentatively decided that direct-response advertising costs should be expensed as incurred consistent with other forms of advertising costs.

Next Steps

The Board will continue its discussion of insurance contracts at next week's Board meeting.