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 16, 2020 FASB Board Meeting

Identifiable intangible assets and subsequent accounting for goodwill. The Board discussed the staff’s research and analysis on goodwill amortization periods and methods for an impairment-with-amortization model, as well as evolving amortization models in which the subsequent accounting for goodwill changes over time. The Board decided that:
  1. An entity should amortize goodwill on a straight-line basis; an evolving amortization model would not be permitted.
  2. An entity should amortize goodwill over a 10-year default period, unless an entity elects and justifies another amortization period based on the facts and circumstances of the acquisition.
  3. An entity that elects another amortization period would be subject to a cap.
  4. An entity would not be required to reassess the amortization period.
The Board directed staff to perform additional research and outreach relating to:
  1. Factors and criteria that would justify deviation from the default amortization period
  2. How the factors to consider for the amortization period and the criteria to justify a deviation would interact with the specifics of a cap.

Disclosure framework: disclosures—interim reporting. The Board discussed whether to remove specific disclosure requirements from Topic 270, Interim Reporting, and decided not to remove those requirements.
The Board directed the staff to draft a proposed Accounting Standards Update on interim reporting for vote by written ballot. The Board decided to provide a 90-day comment period for the proposed Update.   

Open discussion: agenda prioritization. The FASB chair announced that the following projects will be removed from the Board’s research agenda:
  1. Disclosure Review—Share-based Payment
  2. Disclosure Review—Foreign Currency
  3. Income Taxes—Backwards Tracing
  4. Inventory and Cost of Sales
  5. Variable Interest Entity Related Party Guidance.
The FASB chair also announced a change to the objective and scope of the research project, Disclosure Review—Intangibles. That research project will consider the accounting for and disclosure of intangibles.