Last updated on September 11, 2019. 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 *)
Project Objective and Background*
Objective:The objective of this project is to provide additional transparency in the reporting of gifts-in-kind through potential enhancements to presentation and disclosure.
Stakeholders have expressed concern about not-for profit organizations (NFPs) using U.S. wholesale market prices to determine the fair value of pharmaceuticals received as gifts-in-kind (GIKs) in situations in which the sale of those pharmaceuticals is prohibited in the United States by donors. NFPs are required to follow the same fair value measurement guidance as other entities; however, the fair value guidance in Topic 820, Fair Value Measurement, does not specifically address restrictions on geographic distribution and how they affect the determination of the principal (or most advantageous) market. Some regulators are concerned that inflating the fair value measurement of donated pharmaceuticals increases an NFP’s revenue and program expenses, which would make the NFP appear larger and more efficient in its use of resources than a smaller NFP or an NFP that had lower values for its GIKs received.
To address the fair value questions, concerns, and diversity in practice noted by stakeholders, the FASB chairman added a project to the research agenda on June 26th, 2019, about the presentation, disclosure, and valuation of GIK contributions, including donated pharmaceuticals. On August 21, 2019, the project was moved to the FASB’s technical agenda to focus on bringing transparency about GIK that will focus on presentation and disclosure.
Exposure Draft(s):There are no exposure documents at this time.
There are no media releases or educational materials at this time.
Media Releases and Educational Materials*
Decisions Reached at Last Meeting (August 21, 2019):
The Board discussed its research project on the potential approaches for presentation, disclosure, and valuation of gifts-in-kind (GIKs), including donated pharmaceuticals, and decided to add a project to the Board’s technical agenda.
The Board decided that the preliminary scope of the project would be GIKs of nonfinancial assets and instructed the staff to proceed with additional research and outreach on both the scope and the potential enhancements. As part of that additional research and outreach, the Board also instructed the staff to determine whether additional educational guidance concerning application of existing valuation guidance in Topic 820, Fair Value Measurement, may be warranted to address diversity in practice that may exist.
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.
Board Meeting Materials and Information*
The following are links to the minutes for each meeting. To view Board meetings and handouts from the past 90 days, click here.
|August 21, 2019*||Board Meeting—The Board discussed its research project on the potential approaches for presentation, disclosure, and valuation of gifts-in-kind, including donated pharmaceuticals, and decided to add a project to the Board’s technical agenda.|