{"schema_version":2,"canonical_url":"https://asc.understandingaccounting.org/asc/321/10/#35-subsequent-measurement","source":"FASB Accounting Standards Codification, Basic View","usage":"Study and research edition. Verify current requirements with the official source. Summaries, enrichment, and tags are machine-generated study aids. Paragraph html preserves source markup; snippet is abbreviated. Pending content is not necessarily effective.","topic":"321","topic_title":"Investments—Equity Securities","subtopic":"321-10","subtopic_title":"Overall","section":{"number":"35","label":"35 Subsequent Measurement","anchor":"35-subsequent-measurement","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"321-10-35-1","para":"35-1","html":"
Except as provided in paragraph 321-10-35-2, investments in equity securities shall be measured subsequently at fair value in the statement of financial position. Unrealized holding gains and losses for equity securities shall be included in earnings.
","snippet":"Except as provided in paragraph 321-10-35-2, investments in equity securities shall be measured subsequently at fair value in the statement of financial position. Unrealized holding gains and losses for equity securities…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:e360a16689eec93069298b926e329bc34068d824fa29f5c798d269aca2868b91","downloaded_from":"2026-09-09T23:39:00.625Z","last_downloaded_at":"2026-09-09T23:39:00.625Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479623","source_sha256":"b9e89014525bb1c345ed1c095a5d51d106b2d2a88e3e0c240a2b3cfdd3b1850e"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:d5c3d19d70e608180271359f106f45027258014586cf490ec23d5c170f4574c4","downloaded_from":"2026-09-09T23:39:00.625Z","last_downloaded_at":"2026-09-09T23:39:00.625Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479623","source_sha256":"b9e89014525bb1c345ed1c095a5d51d106b2d2a88e3e0c240a2b3cfdd3b1850e"}},{"block":null,"heading":"Equity Securities without Readily Determinable Fair Values","paragraphs":[{"citation":"321-10-35-2","para":"35-2","html":"
An entity may elect to measure an equity security without a readily determinable fair value that does not qualify for the practical expedient to estimate fair value in accordance with paragraph 820-10-35-59 at its cost minus impairment, if any. If an entity identifies observable price changes in orderly transactions for the identical or a similar investment of the same issuer, it shall measure the equity security at fair value as of the date that the observable transaction occurred. An election to measure an equity security in accordance with this paragraph shall be made for each investment separately. Once an entity elects to measure an equity security in accordance with this paragraph, the entity shall continue to apply the measurement guidance in this paragraph until the investment does not qualify to be measured in accordance with this paragraph (for example, if the investment has a readily determinable fair value or becomes eligible for the practical expedient to estimate fair value in accordance with paragraph 820-10-35-59). The entity shall reassess at each reporting period whether the equity investment without a readily determinable fair value qualifies to be measured in accordance with this paragraph. If an entity measures an equity security in accordance with this paragraph (and the security continues to qualify for measurement in accordance with this paragraph), the entity may subsequently elect to measure the equity security at fair value. If an entity subsequently elects to measure an equity security at fair value, the entity shall measure all identical or similar investments of the same issuer, including future purchases of identical or similar investments of the same issuer, at fair value. The election to measure those securities at fair value shall be irrevocable. Any resulting gains or losses on the securities for which that election is made shall be recorded in earnings at the time of the election.
","snippet":"An entity may elect to measure an equity security without a readily determinable fair value that does not qualify for the practical expedient to estimate fair value in accordance with paragraph 820-10-35-59 at its cost m…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:849772a72496f99558d18883fa7d262225b707155cec05b02d6b9b4a728319c6","downloaded_from":"2026-09-09T23:39:00.625Z","last_downloaded_at":"2026-09-09T23:39:00.625Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479623","source_sha256":"b9e89014525bb1c345ed1c095a5d51d106b2d2a88e3e0c240a2b3cfdd3b1850e"}},{"citation":"321-10-35-3","para":"35-3","html":"
An equity security without a readily determinable fair value that does not qualify for the practical expedient to estimate fair value in accordance with paragraph 820-10-35-59 and is measured in accordance with paragraph 321-10-35-2 shall be written down to its fair value if a qualitative assessment indicates that the investment is impaired and the fair value of the investment is less than its carrying value, as determined using the guidance in paragraph 321-10-35-2. At each reporting period, an entity that holds an equity security shall make a qualitative assessment considering impairment indicators to evaluate whether the investment is impaired. Impairment indicators that an entity considers include, but are not limited to, the following:
  1. a
    A significant deterioration in the earnings performance, credit rating, asset quality, or business prospects of the investee
  2. b
    A significant adverse change in the regulatory, economic, or technological environment of the investee
  3. c
    A significant adverse change in the general market condition of either the geographical area or the industry in which the investee operates
  4. d
    A bona fide offer to purchase, an offer by the investee to sell, or a completed auction process for the same or similar investment for an amount less than the carrying amount of that investment
  5. e
    Factors that raise significant concerns about the investee's ability to continue as a going concern, such as negative cash flows from operations, working capital deficiencies, or noncompliance with statutory capital requirements or debt covenants.
","snippet":"An equity security without a readily determinable fair value that does not qualify for the practical expedient to estimate fair value in accordance with paragraph 820-10-35-59 and is measured in accordance with paragraph…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:3fc04a654fc8e9241c7eedd417c2e34bfa7ef0d901561ecd2fe167c40871e44e","downloaded_from":"2026-09-09T23:39:00.625Z","last_downloaded_at":"2026-09-09T23:39:00.625Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479623","source_sha256":"b9e89014525bb1c345ed1c095a5d51d106b2d2a88e3e0c240a2b3cfdd3b1850e"}},{"citation":"321-10-35-4","para":"35-4","html":"
If an equity security without a readily determinable fair value is impaired, an entity shall include an impairment loss in net income equal to the difference between the fair value of the investment and its carrying amount. That is, if the investment is deemed to be impaired after conducting the evaluation required by paragraph 321-10-35-3, the entity shall estimate the fair value of the investment to determine the amount of the impairment loss.
","snippet":"If an equity security without a readily determinable fair value is impaired, an entity shall include an impairment loss in net income equal to the difference between the fair value of the investment and its carrying amou…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:de149a149070f26b7fc18eb12e8c64aee05dc9857beec22d28679b3d477b7161","downloaded_from":"2026-09-09T23:39:00.625Z","last_downloaded_at":"2026-09-09T23:39:00.625Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479623","source_sha256":"b9e89014525bb1c345ed1c095a5d51d106b2d2a88e3e0c240a2b3cfdd3b1850e"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:26e4d016e305683cf5a24c2108711820f9065f756ba20087894f3f0e272b240e","downloaded_from":"2026-09-09T23:39:00.625Z","last_downloaded_at":"2026-09-09T23:39:00.625Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479623","source_sha256":"b9e89014525bb1c345ed1c095a5d51d106b2d2a88e3e0c240a2b3cfdd3b1850e"}},{"block":null,"heading":"Investment in Equity Securities of an Equity Method Investee","paragraphs":[{"citation":"321-10-35-5","para":"35-5","html":"
Paragraphs
323-10-35-23 through 35-26
identify circumstances in which an entity must adjust the basis of its investment in equity securities of an equity method investee for the amount of an equity method loss based on the investment's seniority. For investments accounted for in accordance with this Subtopic, the adjusted basis resulting from the application of paragraphs
323-10-35-23 through 35-26
becomes the equity security's basis from which subsequent changes in fair value are measured.
","snippet":"Paragraphs 323-10-35-23 through 35-26 identify circumstances in which an entity must adjust the basis of its investment in equity securities of an equity method investee for the amount of an equity method loss based on t…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:2e1278988f77bf7072a7eb2af8ef6531dbfca0108d1db1abe5fde47df63b75ef","downloaded_from":"2026-09-09T23:39:00.625Z","last_downloaded_at":"2026-09-09T23:39:00.625Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479623","source_sha256":"b9e89014525bb1c345ed1c095a5d51d106b2d2a88e3e0c240a2b3cfdd3b1850e"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:790e63b360410d851406b926a1b015fdbc4d039ced94ed4cc918b0a09f8095d7","downloaded_from":"2026-09-09T23:39:00.625Z","last_downloaded_at":"2026-09-09T23:39:00.625Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479623","source_sha256":"b9e89014525bb1c345ed1c095a5d51d106b2d2a88e3e0c240a2b3cfdd3b1850e"}},{"block":null,"heading":"Dividend Income from Investments in Equity Securities","paragraphs":[{"citation":"321-10-35-6","para":"35-6","html":"
Dividend income from investments in equity securities shall be included in earnings.
","snippet":"Dividend income from investments in equity securities shall be included in earnings.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:7f3c32ab54d193a5a6ef1eb2abca04eb4c2bdd4b2f696e91b3f3e887b1c7c9c4","downloaded_from":"2026-09-09T23:39:00.625Z","last_downloaded_at":"2026-09-09T23:39:00.625Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479623","source_sha256":"b9e89014525bb1c345ed1c095a5d51d106b2d2a88e3e0c240a2b3cfdd3b1850e"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:82ec1b850d294c50c4ea4fc3c41fd0d5937c10c6b850ca0c58f83e28087abbbe","downloaded_from":"2026-09-09T23:39:00.625Z","last_downloaded_at":"2026-09-09T23:39:00.625Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479623","source_sha256":"b9e89014525bb1c345ed1c095a5d51d106b2d2a88e3e0c240a2b3cfdd3b1850e"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:2dd7f9b738ea1242ed8737c246710934543b085da4680897e7297f49a09b95ec","downloaded_from":"2026-09-09T23:39:00.625Z","last_downloaded_at":"2026-09-09T23:39:00.625Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479623","source_sha256":"b9e89014525bb1c345ed1c095a5d51d106b2d2a88e3e0c240a2b3cfdd3b1850e"}},"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:2dd7f9b738ea1242ed8737c246710934543b085da4680897e7297f49a09b95ec","downloaded_from":"2026-09-09T23:39:00.625Z","last_downloaded_at":"2026-09-09T23:39:00.625Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479623","source_sha256":"b9e89014525bb1c345ed1c095a5d51d106b2d2a88e3e0c240a2b3cfdd3b1850e"}}