Personal Financial Statements

ASC 274 sets the reporting framework for personal financial statements of an individual, a married couple, or a family: assets are presented at estimated current values and liabilities at estimated current amounts, both recognized on the accrual basis (274-10-25-1; 274-10-35-1). The required statement is a statement of financial condition ending in net worth, with assets and liabilities listed by order of liquidity and maturity and no current/noncurrent classification; statements of changes in net worth and comparative statements are optional (274-10-45-4, 45-5, 45-7). Measurement rules are asset-specific — discounted amounts for receivables, payables, nonforfeitable fixed rights and noncancellable commitments; quoted market prices for marketable securities; cash value less policy loans for life insurance; and a single net investment amount for a closely held business marketable as a going concern (274-10-35-4 through 35-13, 45-9, 45-11). The distinctive feature is a provision for estimated income taxes computed as if all assets were realized and all liabilities liquidated at the statement date, presented between liabilities and net worth (274-10-35-15, 274-10-45-12), supported by extensive disclosures (274-10-50-2).

Subtopics

1. 10Overall52 ¶

   ASC 274-10 governs personal financial statements prepared for an individual, a married couple, or a family. The core rule is that assets are presented at their estimated current values and liabilities at their estimated current amounts on the accrual basis (274-10-25-1; 274-10-35-1), with a provision for estimated income taxes on the difference between those amounts and the related tax bases (274-10-35-15). The required statement is a statement of financial condition ending in net worth; a statement of changes in net worth and comparative statements are optional (274-10-45-4, 45-5).

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