ASC

ASC 230-978

Real Estate—Time-Sharing Activities

230 Statement of Cash Flows

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In brief

IntermediateCash flowsPresentationIndustry-specificFinancial statement presentation

This subtopic governs how entities engaged in real estate time-sharing activities classify cash flows related to time-sharing notes receivable. The core rule is that all changes in time-sharing notes receivable — including cash received from selling those notes — are reported as operating activities in the statement of cash flows (230-978-45-1), rather than as investing or financing activities.

Key points (4)
  • The subtopic addresses cash flow presentation for real estate time-sharing transactions (230-978-05-1).
  • Its scope follows Section 978-10-15, the scope of the Real Estate—Time-Sharing Activities Overall Subtopic (230-978-15-1).
  • Changes in time-sharing notes receivable are reported as cash flows from operating activities (230-978-45-1).
  • Sales of time-sharing notes receivable are likewise classified as operating cash flows, not investing or financing (230-978-45-1).

For students. This is a short industry-specific override worth remembering: the intuitive answer — that notes receivable are investing activities and their sale is a financing/investing inflow — is wrong for time-share sellers, because the notes arise from the entity's core revenue-generating sales activity. Expect a classification question that tests whether you apply the general ASC 230 rules or this exception.

time-sharing notes receivableoperating activities classificationstatement of cash flowsreal estate time-sharing transactionssales of receivablesindustry-specific cash flow guidance

Machine-generated study aid for ASC 230-978. Check the source paragraphs below.

230-978-00Status

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230-978-00-1
The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
Time-SharingAmendedAccounting Standards Update No. 2014-0603/14/2014
Undivided Interest (2nd def.)SupersededAccounting Standards Update No. 2014-0603/14/2014

230-978-05Overview and Background

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230-978-05-1
This Subtopic addresses cash flow presentation matters for real estate time-sharing transactions.

230-978-15Scope and Scope Exceptions

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Overall Guidance

230-978-15-1
This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 978-10-15.

230-978-45Other Presentation Matters

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230-978-45-1
Changes in time-sharing notes receivable, including sales of the notes, shall be reported in the statement of cash flows as cash flows from operating activities.

Related subtopics