Effective now for public companies is a new source of instructions for recognizing, measuring, and disclosing liabilities under U.S. generally accepted accounting principles (US GAAP). Released by the Financial Accounting Standards Board (FASB) and called the Codification, it replaces and supersedes all other non-SEC (U.S. Securities and Exchange Commission) instructions, e.g., all preceding FASB standards and guidance.
Where are instructions in the Codification for recognition, measurement, and disclosure of environmental liabilities?
Locating those instructions requires users to adjust from the standards-based model for information that FASB formerly used to the Codification’s topics-based organization. Recall that information in the standards-based model had the topics loss contingencies and asset retirement obligations for environmental liabilities.
The Codification has roughly 90 formal Topics, subdivided further into Subtopics, Sections, paragraphs, and subparagraphs. Codification Topics are identified by 3-digit numbers, and Subtopics and Sections by 2-digit numbers.
Instructions for loss contingencies and asset retirement obligations in the Codification are found at the Subtopic level, in these five Subtopics:
It will take some initial effort for users to adjust to new locations for information formerly associated with other sources. The Codification does provide users with assistance in that effort, however. With the Codification’s Cross Reference feature, users can select a former source name, e.g., FAS 5 or FAS 143, and be directed to its content in the Codification.
FASB ASC Subtopic 805-20, Business Combinations – Identifiable Assets and Liabilities, and Any Noncontrolling Liabilities.
Friday, December 11, 2009
So, where are Codification instructions for environmental liabilities?
