NEWS RELEASE 6/15/00

FASB Rescinds Statement on Motion Pictures

Norwalk, CT, June 15, 2000—Today, the Financial Accounting Standards Board issued Statement 139, which rescinds FASB Statement 53 on financial reporting by motion picture film producers or distributors. The Statement defers to a Statement of Position developed by the American Institute of CPAs.

A business that is a producer or distributor of films and that previously applied Statement 53 is now required to follow the guidance in the AICPA's Statement of Position 00-2, Accounting by Producers or Distributors of Films. This Statement and the AICPA's Statement of Position are effective for fiscal years beginning after December 15, 2000, with earlier application encouraged.

"When Statement 53 was issued in 1981, the majority of a film's revenue resulted from distribution to movie theaters and free television," explained FASB Project Manager Frank Scheuerell. "Since that time, extensive changes have occurred in the film industry. Home video, satellite and cable television, and pay-per-view television have come into existence, and international revenue has increased in significance. Because of these changes, considerable variations in the application of Statement 53 arose. This new Statement of Position will once again bring harmony to financial reporting for motion picture films."

Statement 139 also amends FASB Statement 63, Financial Reporting by Broadcasters, to indicate that a broadcaster is required to apply the guidance in SOP 00-2 if it owns the film (program material) that is shown on its cable, network, or local television outlets. It also amends FASB Statements 89, Financial Reporting and Changing Prices, and Statement 121, Accounting for the Impairment of Long-Lived Assets and Long-Lived Assets to Be Disposed Of.

Copies of Statement 139 are available for purchase from the FASB Order Department, telephone (800) 748-0659.