The Scope Section of the Overall Subtopic establishes the scope for the Investments—Equity Securities Topic.
(P) December 16, 2026; (N) December 16, 2026
606-10-65-3An entity shall not apply the guidance in this Topic to share-based noncash consideration from a customer for the transfer of goods or services unless and until the entity’s right to receive or retain the share-based noncash consideration is unconditional under Topic 606 in accordance with paragraph 606-10-15-3A. Similarly, an entity shall not apply the guidance in this Topic to share-based noncash consideration from a counterparty for the transfer of nonfinancial assets or in substance nonfinancial assets unless and until the entity’s right to receive or retain the share-based noncash consideration is unconditional under Subtopic 610-20 in accordance with paragraph 610-20-15-3A. Dividend income from investments in equity securities shall be included in earnings.
The disclosures in this Section are required for all interim and annual periods.
An entity that applies the guidance in paragraph 321-10-35-2 for equity securities without readily determinable fair values shall disclose all of the following: - a
The carrying amount of investments without readily determinable fair values
- b
The amount of impairments and downward adjustments, if any, both annual and cumulative
- c
The amount of upward adjustments, if any, both annual and cumulative
- d
As of the date of the most recent statement of financial position, additional information (in narrative form) that is sufficient to permit financial statement users to understand the quantitative disclosures and the information that the entity considered in reaching the carrying amounts and upward or downward adjustments resulting from observable price changes.
(P) December 16, 2027; (N) December 16, 2028
270-10-65-1For interim and annual reporting periods, an entity that applies the guidance in paragraph 321-10-35-2 for equity securities without readily determinable fair values shall disclose all of the following: - a
The carrying amount of investments without readily determinable fair values
- b
The amount of impairments and downward adjustments, if any, both annual and cumulative
- c
The amount of upward adjustments, if any, both annual and cumulative
- d
As of the date of the most recent statement of financial position, additional information (in narrative form) that is sufficient to permit financial statement users to understand the quantitative disclosures and the information that the entity considered in reaching the carrying amounts and upward or downward adjustments resulting from observable price changes.
For each period for which the results of operations are presented, an entity shall disclose the portion of unrealized gains and losses for the period that relates to equity securities still held at the reporting date. The portion of unrealized gains and losses for the period related to equity securities still held at the reporting date is calculated as follows. ![](\"/asc-img/GUID-1A4DC97A-9EFD-453A-8AD5-2EFE5957EAC5-low.gif\")
Net gains and losses recognized during the period on equity securities $105 Less: Net gains and losses recognized during the period on equity securities sold during the period (80) Unrealized gains and losses recognized during the reporting period on equity securities still held at the reporting date $25
(P) December 16, 2027; (N) December 16, 2028
270-10-65-1For each interim and annual reporting period for which the results of operations are presented, an entity shall disclose the portion of unrealized gains and losses for the period that relates to equity securities still held at the reporting date. The portion of unrealized gains and losses for the period related to equity securities still held at the reporting date is calculated as follows. An entity should not look through the form of its investment to the nature of the securities held by an investee to determine whether the scope of this Topic applies.
To identify observable price changes, an entity should consider relevant transactions that occurred on or before the balance sheet date that are known or can reasonably be known. To identify price changes that can reasonably be known, the entity should make a reasonable effort (that is without expending undue cost and effort) to identify any observable transactions that it may not be readily aware of. The entity need not conduct an exhaustive search for all observable price changes.
The following table identifies the changes made to this Subtopic.
In determining whether an instrument is within the scope of this Subtopic, an entity shall not look through the form of its investment to the nature of the securities held by an investee. For example, an entity invests in a limited partnership interest (or a venture capital entity) that meets the definition of an equity security. However, substantially all of the partnership's assets consist of investments in debt securities. In the specific situation described, the investment would be considered an equity security.
This Subtopic does not specify methods to be used for measuring the amount of dividend income.