PROJECT UPDATE

Disaggregation—Income Statement Expenses

Last updated on August 2, 2022. Please refer to the Current Technical Plan for information about the expected release dates of exposure documents and final standards.

(Sections updated on the date above are indicated with an asterisk *)

 

Objective:

The objective of the Disaggregation—Income Statement Expenses (formerly known as the Financial Performance Reporting—Disaggregation of Performance Information) project is to improve the decision usefulness of business entities’ income statements through the disaggregation of certain expense captions.
 

Background:

In February 2022, the Board decided that it would revise the scope and objective of the project to focus on improving the decision usefulness of business entities’ income statements through the disaggregation of (a) selling, general, and administrative expenses, (b) cost of services and other cost of revenues, and (c) cost of tangible goods sold.

Exposure Draft:

There are no exposure documents at this time.

There are no media releases or educational materials at this time.

Decisions Reached at Last Meeting (July 27, 2022)


The Board discussed the feedback received through various outreach efforts and the project’s next steps.

Tentative Board Decisions:


Reached Since the Scope and Objective Revision (between February 16, 2022 and July 27, 2022)


The Board decided to:
  1. Revise the project objective, stating that the objective is to improve the decision usefulness of business entities’ income statements through the disaggregation of certain expense captions.
  2. Establish a project scope that includes the following expense captions: (a) selling, general, and administrative expenses, (b) cost of services and other cost of revenues, and (c) cost of tangible goods sold.

Reached Before the Scope and Objective Revision (before February 16, 2022)


A summary of the Board’s tentative decisions reached before February 16, 2022 can be found here.

The Board meeting minutes, handouts, and videos 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.

The following are links to the minutes for each meeting. To view Board meetings and handouts from the past 90 days, click here.
 
July 27, 2022* Board MeetingThe Board discussed the feedback received through various outreach efforts and the project’s next steps.
February 16, 2022 Board MeetingThe Board revised the scope and objective of the project.

See below for decisions made before the revision of the scope and objective of the project.
 
December 11, 2019 Board MeetingDiscussed feedback received from stakeholder outreach on the internal view approach to disaggregation and the path forward for the project.
April 24, 2019 Board MeetingDiscussed an internal view approach to disaggregating expense information and related alternatives.
December 19, 2018 Board MeetingDiscussed the feedback received during outreach with entities on their system capabilities to disaggregate income statement line items.
March 28, 2018 Board Meeting—Discussed the staff’s suggested terminology to describe the lines from the income statement to be the focus of the disaggregation.
December 13, 2017 Board Meeting—Discussed the project plan and research relating to the presentation and disaggregation of functional and natural information in the performance statements of private companies.
September 20, 2017 Board Meeting—Added a project on the disaggregation of performance information to the technical agenda. The Board decided to retain the issue of structuring the performance statement by developing an operating performance measure on the research agenda.

The Board discussed the next steps of the project and directed the staff to perform additional research as part of initial deliberations.

Mary Mazzella
Assistant Director
msmazzella@fasb.org
 
Chris Bohdan
Project Manager
cbohdan@fasb.org
 
Michael Lupo
Project Manager
mlupo@fasb.org

Gary Sardo
FASB Practice Fellow
gsardo@fasb.org

Sarah Wasikowski
Postgraduate Technical Assistant
swasikowski@fasb.org

Justin Chudzik
Postgraduate Technical Assistant
jchudzik@fasb.org

The staff has prepared this summary for information purposes only. Any Board decisions are tentative and do not change current accounting. Official positions of the FASB are determined only after extensive due process and deliberations.
 

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