Tentative Board Decisions

Tentative Board decisions are provided for those interested in following the Board’s deliberations. All of the reported decisions are tentative and may be changed at future Board meetings.

April 23, 2014 FASB Board Meeting

Cash Flows Pre-agenda Research. The Board discussed the pre-agenda research work on Topic 230, Statement of Cash Flows. Specifically, the Board discussed cash flow issues related to the classification of certain types of cash receipts and cash payments. The meeting was educational; no decisions were made.

Next Steps

The Board will decide at its April 28, 2014 agenda prioritization meeting whether to add a project on this Topic to its technical agenda.


Accounting for Financial Instruments—Classification and Measurement. The Board continued redeliberating the February 2013 proposed Accounting Standards Update, Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities, specifically discussing how an entity would present changes in fair value arising from a change in instrument-specific credit risk for financial liabilities measured at fair value through net income.

The Board affirmed the decision reached at its April 4, 2014 meeting to retain the fair value option in Topic 825.

The Board decided that when an entity uses the fair value option to measure a financial liability at fair value, it would present separately in other comprehensive income the portion of the total fair value change caused by a change in instrument-specific credit risk. The Board also decided that an entity may consider the portion of the total change in fair value that exceeds the amount resulting from a change in a base market risk, such as a risk-free interest rate, to be the result of a change in instrument-specific credit risk. Alternatively, an entity may determine the effect of changes in the instrument-specific credit risk by using another method that it considers to more faithfully represent that change. An entity would be required to disclose what method it uses to determine the gains and losses attributable to instrument-specific credit risk and should apply that method consistently from period to period.

The Board decided that an entity should continue to present in net income the changes in fair value due to instrument-specific credit risk for derivative liabilities.