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.

Wednesday, December 19, 2018 FASB Board Meeting

Segment reporting. The Board discussed feedback received on the 2018 segment aggregation study. That study considered alternatives to improve the aggregation criteria and the reportable segments process.

The Board acknowledged the challenges identified by participants in the study. Specifically, the Board was concerned that the alternatives could increase the frequency of restatements of segment information in prior reporting periods. The Board also was concerned about the incentive for entities to use the flexibility within the management approach to work around the alternatives. Overall, the Board was not persuaded that the alternatives provided cost-beneficial solutions.
Next Steps 

The Board directed the staff to focus next on the segment disclosure requirements in order to facilitate a second segment reporting study. As part of that effort, the staff will analyze options to improve how the management approach applies to the segment disclosure requirements, specifically, the meaning of “regularly reviewed” information. The staff plans to bring that analysis to the Board at a later date.

The Board plans to make technical decisions upon the conclusion of both studies.

Financial performance reporting—disaggregation of performance information. The Board discussed feedback received during outreach with preparers on their system capabilities to disaggregate income statement line items.

Additionally, the Board discussed potential paths forward given the challenges identified by preparers in providing additional disaggregation.
Next Steps 

The Board directed the staff to consider various ways of disaggregating expense information based on how it is viewed internally by management. This research will include outreach with preparers and users to understand the operability and usefulness of those alternatives as well as consideration of the location of that information within the financial statements.
The Board discussed whether to combine the Financial Performance Reporting project with the Segment Reporting project. The Board acknowledged the relationship between the two and that the findings in one project could be useful to the other. However, the Board concluded that the two projects should remain separate. 

Updating the definition of collections. The Board discussed the staff’s research on direct care and completed redeliberations of the proposed Accounting Standards Update, Not-for-Profit Entities (Topic 958): Updating the Definition of Collections. The Board made the following decisions. 

Direct Care of Collections 

The Board affirmed its decision to update the Codification Master Glossary definition of collections to include the concept of direct care. The Board discussed describing direct care in the amendments to the Codification but decided not to include such a description. 


The Board decided to require that a collection-holding entity disclose its policies for the use of proceeds from deaccessioned (removed) collection items. The Board also decided that if a collection-holding entity allows proceeds from deaccessioned collection items to be used for direct care, the entity will be required to disclose what the entity considers direct care. 


The Board decided to require prospective transition. 

Effective Date 

The Board decided that the amendments in the final Update would be effective for all entities for annual periods beginning after December 15, 2019, and for interim periods within annual periods beginning after December 15, 2020.  

Analysis of Costs and Benefits 

The Board concluded that it has received sufficient information and analysis to make an informed decision that the expected benefits of the amendments would justify the expected costs.    

Next Steps 

The Board directed the staff to draft a final Accounting Standards Update for vote by written ballot.

Financial instruments—credit losses implementation The Board decided to extend the comment letter period an additional 30 days for the proposed Accounting Standards Update, Codification Improvements—Financial Instruments. Comment letters for the proposed Update will be due on January 18, 2019.
Other Items
The Board decided to:
  1. Conduct further research and analysis before issuing the proposed Accounting Standards Update, Codification Improvements to Financial Instruments—Credit Losses (Topic 326): Vintage Disclosure: Gross Writeoffs and Gross Recoveries, which would require that total gross writeoffs and total gross recoveries be presented by class of financing receivable and major security type within the credit quality information vintage disclosure described in paragraphs 326-20-50-5 through 50-6.
  2. Hold a public roundtable in January 2019 to discuss the topic in (1) above and a proposal submitted by a group of banks to consider an alternative approach to presenting expected credit losses on the income statement.
The Board expressed support for the staff’s efforts to create a question-and-answer document that will address particular issues on the weighted average remaining maturity (WARM) method for estimating credit loss reserves under Topic 326, Financial Instruments—Credit Losses.