{"schema_version":2,"canonical_url":"https://asc.understandingaccounting.org/asc/405/","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.","number":"405","title":"Liabilities","area":"Liabilities","group":null,"subtopics":[{"number":"405-10","topic":"405","title":"Overall","area":"Liabilities","paragraphs":6,"summary":"ASC 405-10 is the Overall subtopic of the Liabilities Topic; it functions as a navigational \"roadmap\" rather than a source of substantive measurement rules. It lists the other Subtopics within Topic 405 (Extinguishments of Liabilities, Insurance-Related Assessments, Joint and Several Liability Arrangements, Supplier Finance Programs) and points to the Topics elsewhere in the Codification that directly address recognition of particular liabilities.","concepts":["liabilities","recognition of liabilities","codification navigation","extinguishment of liabilities","contingencies","guarantees","distinguishing liabilities from equity","supplier finance programs"],"categories":["Recognition","Presentation","Contingencies and guarantees","Debt and equity"],"level":"introductory","topic_title":"Liabilities","sections":[{"number":"00","label":"00 Status","anchor":"00-status","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-10-00-1","para":"00-1","html":"
The following table identifies the changes made to this Subtopic.
Paragraph Action Accounting Standards Update Date
405-10-05-1 Amended Accounting Standards Update No. 2022-04 09/29/2022
405-10-05-1 Amended Maintenance Update 2014-20 (PDF) 09/29/2014
405-10-05-2 Amended Accounting Standards Update No. 2023-04 08/03/2023
405-10-05-2 Amended Accounting Standards Update No. 2014-09 05/28/2014
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The Liabilities Topic includes the following Subtopics:
  1. a
    Overall
  2. b
    Extinguishments of Liabilities
  3. c
    Insurance-Related Assessments
  4. d
    Obligations Resulting from Joint and Several Liability Arrangements
  5. e
    Supplier Finance Programs.
","snippet":"The Liabilities Topic includes the following Subtopics:\n(a) Overall\n(b) Extinguishments of Liabilities\n(c) Insurance-Related Assessments\n(d) Obligations Resulting from Joint and Several Liability Arrangements\n(e) Supplie…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8f24eaa56ea6c2f128269c266499f5104beceecbad300823441365a5dfd83aa2","downloaded_from":"2026-09-10T00:13:38.382Z","last_downloaded_at":"2026-09-10T00:13:38.382Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482703","source_sha256":"2b74ea4ead2f9af6bef45bae263ebaac73a21d20fc3be456ced24a755e8790da"}},{"citation":"405-10-05-2","para":"05-2","html":"
This Subtopic identifies the locations in the Codification that provide guidance for liabilities. The following Topics directly discuss the recognition of liabilities:
  1. a
    Asset Retirement and Environmental Obligations, see Topic 410
  2. b
    Exit or Disposal Cost Obligations, see Topic 420
  3. c
    Deferred Revenue and Contract Liabilities, see Topic 430
  4. d
    Commitments, see Topic 440
  5. e
    Contingencies, see Topic 450
  6. f
    Guarantees, see Topic 460
  7. g
    Debt, see Topic 470
  8. h
    Distinguishing Liabilities from Equity, see Topic 480.
","snippet":"This Subtopic identifies the locations in the Codification that provide guidance for liabilities. The following Topics directly discuss the recognition of liabilities:\n(a) Asset Retirement and Environmental Obligations, …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:cb8070a2c8312bd80096e642e565493da948936a383bd4767f6b156c800b66ff","downloaded_from":"2026-09-10T00:13:38.382Z","last_downloaded_at":"2026-09-10T00:13:38.382Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482703","source_sha256":"2b74ea4ead2f9af6bef45bae263ebaac73a21d20fc3be456ced24a755e8790da"}},{"citation":"405-10-05-3","para":"05-3","html":"
Other Topics, including industries, may contain guidance related to specific liabilities associated with those Topics.
","snippet":"Other Topics, including industries, may contain guidance related to specific liabilities associated with those Topics.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f3040b6856654242847b4ef5a492d6b8cc6007b82bcbb54286670d35ae324975","downloaded_from":"2026-09-10T00:13:38.382Z","last_downloaded_at":"2026-09-10T00:13:38.382Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482703","source_sha256":"2b74ea4ead2f9af6bef45bae263ebaac73a21d20fc3be456ced24a755e8790da"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:19caeafdc165261a285c16b7f03aa004ea7e67bd94197a4faa12e1ec893743ce","downloaded_from":"2026-09-10T00:13:38.382Z","last_downloaded_at":"2026-09-10T00:13:38.382Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482703","source_sha256":"2b74ea4ead2f9af6bef45bae263ebaac73a21d20fc3be456ced24a755e8790da"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:c987b2b9f551f7e97fc51ebee77f9197d58634cc3dc32eb71329bf2c0d8984a1","downloaded_from":"2026-09-10T00:13:38.382Z","last_downloaded_at":"2026-09-10T00:13:38.382Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482703","source_sha256":"2b74ea4ead2f9af6bef45bae263ebaac73a21d20fc3be456ced24a755e8790da"}},{"number":"S00","label":"SEC 00 Status","anchor":"sec-00-status","is_sec":true,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-10-S00-1","para":"S00-1","html":"
The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
405-10-S99-1AmendedAccounting Standards Update No. 2025-0203/18/2025
405-10-S99-1AddedAccounting Standards Update No. 2023-0408/03/2023
","snippet":"The following table identifies the changes made to this Subtopic.\nParagraph | Action | Accounting Standards Update | Date |\n| | | |\n405-10-S99-1 | Amended | Accounting Standards Update No. 2025-02 | 03/18/2025 |\n405-10-S…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:79b878e61c0c619f6c8e2e33bdc255f6ada8887653d43cac6c10e1304bff6347","downloaded_from":"2026-09-10T00:13:40.718Z","last_downloaded_at":"2026-09-10T00:13:40.718Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147476187","source_sha256":"ce6c9287e575c18f63eb873562e5c7fb2a8b17023011a47b37c92e75187a0f50"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f0e909a119d281e409121c7081f9a83867636b3f4fa786331b57c1cbd5fd9572","downloaded_from":"2026-09-10T00:13:40.718Z","last_downloaded_at":"2026-09-10T00:13:40.718Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147476187","source_sha256":"ce6c9287e575c18f63eb873562e5c7fb2a8b17023011a47b37c92e75187a0f50"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:fd902bdeb6a2ce7ef1b835e06bf0fc3c6c78439a2718def98f31798c22b007ab","downloaded_from":"2026-09-10T00:13:40.718Z","last_downloaded_at":"2026-09-10T00:13:40.718Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147476187","source_sha256":"ce6c9287e575c18f63eb873562e5c7fb2a8b17023011a47b37c92e75187a0f50"}},{"number":"S99","label":"SEC 99 SEC Materials","anchor":"sec-99-sec-materials","is_sec":true,"groups":[{"block":null,"heading":"SEC Staff Guidance","paragraphs":[{"citation":"405-10-S99-1","para":"S99-1","html":"
The following is the text of SAB Topic 5.FF.
Removed by SAB 122.
","snippet":"The following is the text of SAB Topic 5.FF.Removed by SAB 122.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:a87df6c650a530f55299aff00120759e21b02d1abd48b239491e136b8d79e119","downloaded_from":"2026-09-10T00:13:43.757Z","last_downloaded_at":"2026-09-10T00:13:43.757Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147476188","source_sha256":"212d3952f7178786b4f477a94c76c941d53e2bc5b29263bdb2d408a039f3dcfb"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:408bce967b31d17e3be53bb0b9fac26e2ad1218999889dc1d162d4767f71f8dd","downloaded_from":"2026-09-10T00:13:43.757Z","last_downloaded_at":"2026-09-10T00:13:43.757Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147476188","source_sha256":"212d3952f7178786b4f477a94c76c941d53e2bc5b29263bdb2d408a039f3dcfb"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:3a1c5963298a8a678a2951f77948660083eb74986eb6a6d1686ca36a6b956bee","downloaded_from":"2026-09-10T00:13:43.757Z","last_downloaded_at":"2026-09-10T00:13:43.757Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147476188","source_sha256":"212d3952f7178786b4f477a94c76c941d53e2bc5b29263bdb2d408a039f3dcfb"}}],"enrichment":{"summary":"ASC 405-10 is the Overall subtopic of the Liabilities Topic; it functions as a navigational \"roadmap\" rather than a source of substantive measurement rules. It lists the other Subtopics within Topic 405 (Extinguishments of Liabilities, Insurance-Related Assessments, Joint and Several Liability Arrangements, Supplier Finance Programs) and points to the Topics elsewhere in the Codification that directly address recognition of particular liabilities.","key_points":["Topic 405 comprises the Overall, Extinguishments of Liabilities, Insurance-Related Assessments, Obligations Resulting from Joint and Several Liability Arrangements, and Supplier Finance Programs Subtopics (405-10-05-1).","405-10 itself identifies where liability guidance is located in the Codification rather than establishing recognition or measurement criteria (405-10-05-2).","Topics that directly discuss recognition of liabilities include Topic 410 (asset retirement and environmental obligations), Topic 420 (exit or disposal cost obligations), Topic 430 (deferred revenue and contract liabilities), and Topic 440 (commitments) (405-10-05-2).","Recognition guidance also resides in Topic 450 (contingencies), Topic 460 (guarantees), Topic 470 (debt), and Topic 480 (distinguishing liabilities from equity) (405-10-05-2).","Other Topics, including industry-specific Topics, may contain guidance for liabilities associated with those Topics (405-10-05-3)."],"categories":["Recognition","Presentation","Contingencies and guarantees","Debt and equity"],"audience_level":"introductory","student_note":"Use 405-10 as an index: when a liability question arises, it tells you which Topic (410–480) actually governs. The common mistake is trying to find substantive recognition or measurement rules here — 405-10 contains none.","related_topics":["405-20","410","420","450","460","480"],"key_concepts":["liabilities","recognition of liabilities","codification navigation","extinguishment of liabilities","contingencies","guarantees","distinguishing liabilities from equity","supplier finance programs"],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:09f892a277271fa72695d058236751c79dbb42d3c29ab46284569007b6c98501","downloaded_from":"2026-09-10T00:13:36.711Z","last_downloaded_at":"2026-09-10T00:13:43.757Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},"related":[{"number":"405-40","title":"Obligations Resulting from Joint and Several Liability Arrangements","topic_title":"Liabilities","score":0.7607,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:36a2ab6073f97e6aaec168a0b6bfb2711f2fbba6fa2cd23e2f678f2534bd5d76","downloaded_from":"2026-09-10T00:14:46.909Z","last_downloaded_at":"2026-09-10T00:15:14.537Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"430-10","title":"Overall","topic_title":"Deferred Revenue","score":0.7537,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:b92338fed06fc4e065eff07fc4ad630176a27f58eb047f0d30147307d6cd1387","downloaded_from":"2026-09-10T00:23:26.626Z","last_downloaded_at":"2026-09-10T00:23:37.898Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"405-944","title":"Financial Services—Insurance","topic_title":"Liabilities","score":0.7512,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:29f01bb9e61cd54223a40e831463a0bbd53297828afc0afbe86481ea16de7033","downloaded_from":"2026-09-10T00:18:57.648Z","last_downloaded_at":"2026-09-10T00:19:09.841Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"405-946","title":"Financial Services—Investment Companies","topic_title":"Liabilities","score":0.7505,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:2b1cf616902507cfd18acbc87e110db4c07ca89748dc76ffe1a43ccf49047207","downloaded_from":"2026-09-10T00:19:12.218Z","last_downloaded_at":"2026-09-10T00:19:18.650Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"410-10","title":"Overall","topic_title":"Asset Retirement and Environmental Obligations","score":0.7424,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:9d505747f07a2ad74792608ef51799b33e577c2ec3822ae0600af80d0e23c474","downloaded_from":"2026-09-10T00:20:32.113Z","last_downloaded_at":"2026-09-10T00:20:38.088Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"450-10","title":"Overall","topic_title":"Contingencies","score":0.7372,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:6ee9c1538bb4503dfe76e786a78ea2eb89232f611189e2277c33d9266c036381","downloaded_from":"2026-09-10T00:26:49.502Z","last_downloaded_at":"2026-09-10T00:26:58.831Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}}],"prev":{"number":"360-980","title":"Regulated Operations","topic_title":"Property, Plant, and Equipment","provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f427aa201f159a90cf4f5345ec8af2054e872ddad305e355b9c04df852033943","downloaded_from":"2026-09-10T00:13:03.015Z","last_downloaded_at":"2026-09-10T00:13:32.748Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},"next":{"number":"405-20","title":"Extinguishments of Liabilities","topic_title":"Liabilities","provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:907d978a72abee3a6d43097109dacc428a0be263ae71abcd5d9ef49f1d7fb251","downloaded_from":"2026-09-10T00:13:46.142Z","last_downloaded_at":"2026-09-10T00:14:11.157Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f484b92d2086f65fe043d3851cda74cc92f241c7aeaaeed0522afec5ba335a09","downloaded_from":"2026-09-10T00:13:36.711Z","last_downloaded_at":"2026-09-10T00:13:43.757Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"405-20","topic":"405","title":"Extinguishments of Liabilities","area":"Liabilities","paragraphs":20,"summary":"ASC 405-20 governs when a debtor may derecognize a liability because it has been extinguished. Under 405-20-40-1, extinguishment occurs if and only if the debtor pays the creditor (cash, other financial assets, goods or services, or reacquisition of its own debt securities) and is relieved of the obligation, or the debtor is legally released as primary obligor judicially or by the creditor. The Subtopic also contains special derecognition (breakage) rules for liabilities from prepaid stored-value products and excludes debt conversions and troubled debt restructurings (see 470-20 and 470-60).","concepts":["extinguishment of liabilities","derecognition","legal release from primary obligor","in-substance defeasance","legal defeasance","prepaid stored-value products","breakage","guarantee obligation"],"categories":["Derecognition","Financial instruments","Debt and equity","Disclosure"],"level":"intermediate","topic_title":"Liabilities","sections":[{"number":"00","label":"00 Status","anchor":"00-status","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-20-00-1","para":"00-1","html":"
The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
Environmental CreditAddedAccounting Standards Update No. 2026-0205/19/2026
Environmental Credit ObligationAddedAccounting Standards Update No. 2026-0205/19/2026
ExchangeAddedAccounting Standards Update No. 2026-0205/19/2026
Financial AssetAddedAccounting Standards Update No. 2026-0205/19/2026
Income TaxesAddedAccounting Standards Update No. 2026-0205/19/2026
Nonfinancial AssetAddedAccounting Standards Update No. 2026-0205/19/2026
Nonreciprocal Transfer (1st def.)AddedAccounting Standards Update No. 2026-0205/19/2026
405-20-10-1SupersededAccounting Standards Update No. 2009-1612/23/2009
405-20-15-2AmendedAccounting Standards Update No. 2016-0403/08/2016
405-20-40-1AmendedAccounting Standards Update No. 2026-0205/19/2026
405-20-40-1AmendedAccounting Standards Update No. 2016-0403/08/2016
405-20-40-3AddedAccounting Standards Update No. 2016-0403/08/2016
405-20-40-4AddedAccounting Standards Update No. 2016-0403/08/2016
405-20-50-1AmendedAccounting Standards Update No. 2009-1612/23/2009
405-20-50-2AddedAccounting Standards Update No. 2016-0403/08/2016
405-20-55-2AmendedAccounting Standards Update No. 2012-0410/01/2012
405-20-55-4AmendedAccounting Standards Update No. 2015-1006/12/2015
405-20-55-4AmendedAccounting Standards Update No. 2012-0410/01/2012
405-20-55-6 through 55-8SupersededAccounting Standards Update No. 2009-1612/23/2009
405-20-65-1AddedAccounting Standards Update No. 2016-0403/08/2016
","snippet":"The following table identifies the changes made to this Subtopic.\nParagraph | Action | Accounting Standards Update | Date |\n| | | |\nEnvironmental Credit | Added | Accounting Standards Update No. 2026-02 | 05/19/2026 |\nEn…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:45b73ae06e6f57a6c4815df0458aabcb8867769dcd760c2495c3a0829a2bbc0b","downloaded_from":"2026-09-10T00:13:46.142Z","last_downloaded_at":"2026-09-10T00:13:46.142Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482677","source_sha256":"bbe3d8d9ded9aedb30ad6e9b4848a77c9217970e33c6e4174c44f45c903a5ac8"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:d8a5b06aa0bad039a5bb6dbce752c3b996da0b7390294255fc6811a9d24cca03","downloaded_from":"2026-09-10T00:13:46.142Z","last_downloaded_at":"2026-09-10T00:13:46.142Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482677","source_sha256":"bbe3d8d9ded9aedb30ad6e9b4848a77c9217970e33c6e4174c44f45c903a5ac8"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:dbe1690d361445d6362bdf37b4074ee8aaa1cdf6aac1d47f5d47a4368cb4679f","downloaded_from":"2026-09-10T00:13:46.142Z","last_downloaded_at":"2026-09-10T00:13:46.142Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482677","source_sha256":"bbe3d8d9ded9aedb30ad6e9b4848a77c9217970e33c6e4174c44f45c903a5ac8"}},{"number":"05","label":"05 Overview and Background","anchor":"05-overview-and-background","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-20-05-1","para":"05-1","html":"
This Subtopic addresses extinguishments of liabilities. This Subtopic does not address debt conversions or troubled debt restructurings. The accounting guidance for those areas is addressed in Subtopics 470-20 and 470-60.
","snippet":"This Subtopic addresses extinguishments of liabilities. This Subtopic does not address debt conversions or troubled debt restructurings. The accounting guidance for those areas is addressed in Subtopics 470-20 and 470-60…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:911eec93d65f0d4ba538756617fde537656aa29333fb8e10d5047a21eac8ba29","downloaded_from":"2026-09-10T00:13:49.419Z","last_downloaded_at":"2026-09-10T00:13:49.419Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482651","source_sha256":"c4c5e8b4bcb20f3860ec3e722ef57c3026beae6d48cd88e9e9a412ce1494802b"}},{"citation":"405-20-05-2","para":"05-2","html":"
An entity may settle a liability by transferring assets to the creditor or otherwise obtaining an unconditional release. Alternatively, an entity may enter into other arrangements designed to set aside assets dedicated to eventually settling a liability. Accounting for those arrangements has raised issues about when a liability should be considered extinguished. This Subtopic establishes standards for resolving those issues.
","snippet":"An entity may settle a liability by transferring assets to the creditor or otherwise obtaining an unconditional release. Alternatively, an entity may enter into other arrangements designed to set aside assets dedicated t…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:b7aa508549b769af1a65f0fe01353b69659d0c287c98d40ab1a74dbea160407e","downloaded_from":"2026-09-10T00:13:49.419Z","last_downloaded_at":"2026-09-10T00:13:49.419Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482651","source_sha256":"c4c5e8b4bcb20f3860ec3e722ef57c3026beae6d48cd88e9e9a412ce1494802b"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:2d9f5f33ba28dd6e3431e0133781c37f2f57848e84ce2a5a2a614d9109c6b802","downloaded_from":"2026-09-10T00:13:49.419Z","last_downloaded_at":"2026-09-10T00:13:49.419Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482651","source_sha256":"c4c5e8b4bcb20f3860ec3e722ef57c3026beae6d48cd88e9e9a412ce1494802b"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:7c6339656ddb86a4e8928326922bf2249f4072cc40df68764ed4c81575bc847e","downloaded_from":"2026-09-10T00:13:49.419Z","last_downloaded_at":"2026-09-10T00:13:49.419Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482651","source_sha256":"c4c5e8b4bcb20f3860ec3e722ef57c3026beae6d48cd88e9e9a412ce1494802b"}},{"number":"10","label":"10 Objectives","anchor":"10-objectives","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-20-10-1","para":"10-1","html":"
Paragraph superseded by Accounting Standards Update No. 2009-16.
","snippet":"Paragraph superseded by Accounting Standards Update No. 2009-16.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:37f7cf4a748a105830e80caeaf9812e314a6b4ed533798bede99c850f090dd8b","downloaded_from":"2026-09-10T00:13:53.385Z","last_downloaded_at":"2026-09-10T00:13:53.385Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482625","source_sha256":"0a23e16f79a638013d076915ccaa3ea360386c07f697f47a97c98035c0ab2032"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:b0f37e9010098c4e8fe65ec899901e1047f2652e02b87c6d08d1e63e7586a4c1","downloaded_from":"2026-09-10T00:13:53.385Z","last_downloaded_at":"2026-09-10T00:13:53.385Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482625","source_sha256":"0a23e16f79a638013d076915ccaa3ea360386c07f697f47a97c98035c0ab2032"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8dda5d2677303335ac11132da90d356069b5abb3aa8961afae1b5ea399695838","downloaded_from":"2026-09-10T00:13:53.385Z","last_downloaded_at":"2026-09-10T00:13:53.385Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482625","source_sha256":"0a23e16f79a638013d076915ccaa3ea360386c07f697f47a97c98035c0ab2032"}},{"number":"15","label":"15 Scope and Scope Exceptions","anchor":"15-scope-and-scope-exceptions","is_sec":false,"groups":[{"block":null,"heading":"Entities","paragraphs":[{"citation":"405-20-15-1","para":"15-1","html":"
The guidance in this Subtopic applies to all entities.
","snippet":"The guidance in this Subtopic applies to all entities.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8f64d0ad7a418993be76b9e75bbb912925b65e00746547ff54c5e657a328c676","downloaded_from":"2026-09-10T00:13:55.493Z","last_downloaded_at":"2026-09-10T00:13:55.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482600","source_sha256":"95723c1ba88fe1f96605816304eda015f03bf2821321d03ee933ec7836554aee"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f3a9d3695b54ef2b9221c5b85ac2a42630c940a0b7f505aaae91d4cb1851300f","downloaded_from":"2026-09-10T00:13:55.493Z","last_downloaded_at":"2026-09-10T00:13:55.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482600","source_sha256":"95723c1ba88fe1f96605816304eda015f03bf2821321d03ee933ec7836554aee"}},{"block":null,"heading":"Transactions","paragraphs":[{"citation":"405-20-15-2","para":"15-2","html":"
The guidance in this Subtopic applies to extinguishments of all liabilities, including both financial and nonfinancial liabilities, unless derecognition of a financial or nonfinancial liability is addressed in another Topic (for example, the derecognition guidance for gaming chips in Subtopic 924-405 on casinos or the breakage guidance in Topic 606 on revenue from contracts with customers). Derivative instruments that are nonfinancial liabilities (for example, a written commodity option) are included in the scope of this Subtopic.
","snippet":"The guidance in this Subtopic applies to extinguishments of all liabilities, including both financial and nonfinancial liabilities, unless derecognition of a financial or nonfinancial liability is addressed in another To…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:ddbb66d81b7824dad3af47f26d531b1a5073980f2d4588ef0bf832dd134fa673","downloaded_from":"2026-09-10T00:13:55.493Z","last_downloaded_at":"2026-09-10T00:13:55.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482600","source_sha256":"95723c1ba88fe1f96605816304eda015f03bf2821321d03ee933ec7836554aee"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:26c25dc894899b17004b69fad857bfd3dfa62b422eb3b785c8b9ca4470b13c79","downloaded_from":"2026-09-10T00:13:55.493Z","last_downloaded_at":"2026-09-10T00:13:55.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482600","source_sha256":"95723c1ba88fe1f96605816304eda015f03bf2821321d03ee933ec7836554aee"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:eb5e079e87133f032739db6575b4658dc95330799eae76747e76acf3a953438c","downloaded_from":"2026-09-10T00:13:55.493Z","last_downloaded_at":"2026-09-10T00:13:55.493Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482600","source_sha256":"95723c1ba88fe1f96605816304eda015f03bf2821321d03ee933ec7836554aee"}},{"number":"40","label":"40 Derecognition","anchor":"40-derecognition","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-20-40-1","para":"40-1","html":"
Unless addressed by other guidance (for example, paragraphs
405-20-40-3 through 40-4
or paragraphs
606-10-55-46 through 55-49
), a debtor shall derecognize a liability if and only if it has been extinguished. A liability has been extinguished if either of the following conditions is met:
  1. a
    The debtor pays the creditor and is relieved of its obligation for the liability. Paying the creditor includes the following:
    1. 1
      Delivery of cash
    2. 2
      Delivery of other financial assets
    3. 3
      Delivery of goods or services
    4. 4
      Reacquisition by the debtor of its outstanding debt securities whether the securities are cancelled or held as so-called treasury bonds.
  2. b
    The debtor is legally released from being the primary obligor under the liability, either judicially or by the creditor. For purposes of applying this Subtopic, a sale and related assumption effectively accomplish a legal release if nonrecourse debt (such as certain mortgage loans) is assumed by a third party in conjunction with the sale of an asset that serves as sole collateral for that debt.
Transition date:(P) December 16, 2027; (N) December 16, 2028Transition guidance:
818-10-65-1Unless addressed by other guidance (for example, paragraphs
405-20-40-3 through 40-4
or paragraphs
606-10-55-46 through 55-49
), a debtor shall derecognize a liability if and only if it has been extinguished. A liability has been extinguished if either of the following conditions is met:
  1. a
    The debtor pays the creditor and is relieved of its obligation for the liability. Paying the creditor includes the following:
    1. 1
      Delivery of cash
    2. 2
      Delivery of other financial assets
    3. 3
      Delivery of goods or services
    4. 4
      Reacquisition by the debtor of its outstanding debt securities whether the securities are cancelled or held as so-called treasury bonds
    5. 5
      Delivery of environmental credits.
  2. b
    The debtor is legally released from being the primary obligor under the liability, either judicially or by the creditor. For purposes of applying this Subtopic, a sale and related assumption effectively accomplish a legal release if nonrecourse debt (such as certain mortgage loans) is assumed by a third party in conjunction with the sale of an asset that serves as sole collateral for that debt.
","snippet":"Unless addressed by other guidance (for example, paragraphs 405-20-40-3 through 40-4 or paragraphs 606-10-55-46 through 55-49), a debtor shall derecognize a liability if and only if it has been extinguished. A liability …","pending":true,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:22adfa6fd0ccbd30c5332e75963dcb8842d6abf4f020f80a1f23c8993449081e","downloaded_from":"2026-09-10T00:14:00.411Z","last_downloaded_at":"2026-09-10T00:14:00.411Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482580","source_sha256":"5a9b2ec6d14fc7fd862d1da1060cecfb7c92ac4a0fff80db2ed66192502e5aa0"}},{"citation":"405-20-40-2","para":"40-2","html":"
If a creditor releases a debtor from primary obligation on the condition that a third party assumes the obligation and that the original debtor becomes secondarily liable, that release extinguishes the original debtor's liability. However, in those circumstances, whether or not explicit consideration was paid for that guarantee, the original debtor becomes a guarantor. As a guarantor, it shall recognize a guarantee obligation in the same manner as would a guarantor that had never been primarily liable to that creditor, with due regard for the likelihood that the third party will carry out its obligations. The guarantee obligation shall be initially measured at fair value, and that amount reduces the gain or increases the loss recognized on extinguishment. See Topic 460 for accounting guidance related to guarantees.
","snippet":"If a creditor releases a debtor from primary obligation on the condition that a third party assumes the obligation and that the original debtor becomes secondarily liable, that release extinguishes the original debtor's …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:c6ee59aef484d22a891cc5cad915107c1c180392417f5322c61e5c7d4687b727","downloaded_from":"2026-09-10T00:14:00.411Z","last_downloaded_at":"2026-09-10T00:14:00.411Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482580","source_sha256":"5a9b2ec6d14fc7fd862d1da1060cecfb7c92ac4a0fff80db2ed66192502e5aa0"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:fde4aa2a132288c6201e9ad85476ac926bf94d1997f63a8f50e382e1e7750007","downloaded_from":"2026-09-10T00:14:00.411Z","last_downloaded_at":"2026-09-10T00:14:00.411Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482580","source_sha256":"5a9b2ec6d14fc7fd862d1da1060cecfb7c92ac4a0fff80db2ed66192502e5aa0"}},{"block":null,"heading":"Prepaid Stored-Value Products","paragraphs":[{"citation":"405-20-40-3","para":"40-3","html":"
Prepaid stored-value products are products in physical and digital forms with stored monetary values that are issued for the purpose of being commonly accepted as payment for goods or services. While the holder of a prepaid stored-value product also may be permitted to redeem the product for cash, prepaid stored-value products do not include products that only can be redeemed by the product holder for cash (for example, nonrecourse debt, bearer bonds, or trade payables). Examples of prepaid stored-value products include prepaid gift cards issued on a specific payment network and redeemable at network-accepting merchant locations, prepaid telecommunication cards, and traveler's checks. The derecognition guidance in paragraph 405-20-40-4 does not apply to liabilities related to either of the following:
  1. a
    Prepaid stored-value products (or portions of those products) for which any breakage (that is, the portion of the dollar value of prepaid stored-value products that ultimately is not redeemed by product holders for cash or not used to purchase goods and/or services) must be remitted in accordance with unclaimed property laws
  2. b
    Prepaid stored-value products that are attached to a segregated bank account like a customer depository account.
The guidance also does not apply to customer loyalty programs or transactions within the scope of other Topics (for example, Topic 606 on revenue from contracts with customers).
","snippet":"Prepaid stored-value products are products in physical and digital forms with stored monetary values that are issued for the purpose of being commonly accepted as payment for goods or services. While the holder of a prep…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:c23b8d69b3938c3116478cc5eeaf408381fe574a2c12cd1467ebc90408fe2857","downloaded_from":"2026-09-10T00:14:00.411Z","last_downloaded_at":"2026-09-10T00:14:00.411Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482580","source_sha256":"5a9b2ec6d14fc7fd862d1da1060cecfb7c92ac4a0fff80db2ed66192502e5aa0"}},{"citation":"405-20-40-4","para":"40-4","html":"
If an entity expects to be entitled to a breakage amount for a liability resulting from the sale of a prepaid stored-value product in the scope of paragraph 405-20-40-3, the entity shall derecognize the amount related to the expected breakage in proportion to the pattern of rights expected to be exercised by the product holder only to the extent that it is probable that a significant reversal of the recognized breakage amount will not subsequently occur. If an entity does not expect to be entitled to a breakage amount for prepaid stored-value products in the scope of paragraph 405-20-40-3, the entity shall derecognize the amount related to breakage when the likelihood of the product holder exercising its remaining rights becomes remote. At the end of each period, an entity shall update the estimated breakage amount to represent faithfully the circumstances present at the end of the period and the changes in circumstances during the period. Changes to an entity's estimated breakage amount shall be accounted for as a change in accounting estimate in accordance with paragraphs
250-10-45-17 through 45-20
.
","snippet":"If an entity expects to be entitled to a breakage amount for a liability resulting from the sale of a prepaid stored-value product in the scope of paragraph 405-20-40-3, the entity shall derecognize the amount related to…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:c464eef404add3306aef69e064b3d369c0eaaa2e163152dfda37c42af3b38a74","downloaded_from":"2026-09-10T00:14:00.411Z","last_downloaded_at":"2026-09-10T00:14:00.411Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482580","source_sha256":"5a9b2ec6d14fc7fd862d1da1060cecfb7c92ac4a0fff80db2ed66192502e5aa0"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:bf4829306cf6baa4c494858203c5763181eb49ad3108c0085019aedc1b782c24","downloaded_from":"2026-09-10T00:14:00.411Z","last_downloaded_at":"2026-09-10T00:14:00.411Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482580","source_sha256":"5a9b2ec6d14fc7fd862d1da1060cecfb7c92ac4a0fff80db2ed66192502e5aa0"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:435b87ffdac70b126a000c2873d20f2b54103f089f0e06a9165e4316e07fd208","downloaded_from":"2026-09-10T00:14:00.411Z","last_downloaded_at":"2026-09-10T00:14:00.411Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482580","source_sha256":"5a9b2ec6d14fc7fd862d1da1060cecfb7c92ac4a0fff80db2ed66192502e5aa0"}},{"number":"50","label":"50 Disclosure","anchor":"50-disclosure","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-20-50-1","para":"50-1","html":"
See paragraph 470-50-50-1 for a disclosure requirement for debt considered to be extinguished by in-substance defeasance. In addition, see paragraph 860-30-50-1A for disclosure requirements for assets that are set aside solely for the purpose of satisfying scheduled payments of a specific obligation.
","snippet":"See paragraph 470-50-50-1 for a disclosure requirement for debt considered to be extinguished by in-substance defeasance. In addition, see paragraph 860-30-50-1A for disclosure requirements for assets that are set aside …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:e763fd36172ab78893410f231faaea5b8f4ce472c30ce4b88caf0ba1c7e63792","downloaded_from":"2026-09-10T00:14:02.153Z","last_downloaded_at":"2026-09-10T00:14:02.153Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482555","source_sha256":"5b642958596184112cc514e685184875e62318889dee7f5afce1e9d6b6c0bd99"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:980b76f5eba8fdbb0017a378d42c7abb60b1f754f12951fb0c92d89621b10330","downloaded_from":"2026-09-10T00:14:02.153Z","last_downloaded_at":"2026-09-10T00:14:02.153Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482555","source_sha256":"5b642958596184112cc514e685184875e62318889dee7f5afce1e9d6b6c0bd99"}},{"block":null,"heading":"Prepaid Stored-Value Products","paragraphs":[{"citation":"405-20-50-2","para":"50-2","html":"
An entity that recognizes a breakage amount in accordance with paragraph 405-20-40-4 shall disclose the methodology used to recognize breakage and significant judgments made in applying the breakage methodology.
","snippet":"An entity that recognizes a breakage amount in accordance with paragraph 405-20-40-4 shall disclose the methodology used to recognize breakage and significant judgments made in applying the breakage methodology.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:33295625fa120095885fa814004e6b79e5dd4ffbe6dda3564e37e6a868732daa","downloaded_from":"2026-09-10T00:14:02.153Z","last_downloaded_at":"2026-09-10T00:14:02.153Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482555","source_sha256":"5b642958596184112cc514e685184875e62318889dee7f5afce1e9d6b6c0bd99"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:61b41c01271fc77b80fbdfb85686646a388c288a980c28d955a59959db11ffbe","downloaded_from":"2026-09-10T00:14:02.153Z","last_downloaded_at":"2026-09-10T00:14:02.153Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482555","source_sha256":"5b642958596184112cc514e685184875e62318889dee7f5afce1e9d6b6c0bd99"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:5d7d35a061dc7d1052f04654bfd8726b7aace1d123fc9517cb9321269f98a247","downloaded_from":"2026-09-10T00:14:02.153Z","last_downloaded_at":"2026-09-10T00:14:02.153Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482555","source_sha256":"5b642958596184112cc514e685184875e62318889dee7f5afce1e9d6b6c0bd99"}},{"number":"55","label":"55 Implementation Guidance and Illustrations","anchor":"55-implementation-guidance-and-illustrations","is_sec":false,"groups":[{"block":null,"heading":"Implementation Guidance","paragraphs":[{"citation":"405-20-55-1","para":"55-1","html":"
This Section provides implementation guidance related to the extinguishment of liabilities.
","snippet":"This Section provides implementation guidance related to the extinguishment of liabilities.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:4d872f65d2e7a95778068b7eac775791aa50fffbca68fa55c8d415aefcb8daeb","downloaded_from":"2026-09-10T00:14:05.784Z","last_downloaded_at":"2026-09-10T00:14:05.784Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482534","source_sha256":"24904f5dfb63de58ecf864fe29fb11db40509c23b08b9d8d9242fdb9eeb07e05"}},{"citation":"405-20-55-2","para":"55-2","html":"
The following provides guidance on the application of the liability extinguishment criteria, specifically related to the following:
  1. a
    In-substance defeasance transactions
  2. b
    Transfers of noncash financial assets in settlement of a creditor's receivable
  3. c
    Subparagraph superseded by Accounting Standards Update No. 2012-04.
  4. d
    Extinguishment via legal defeasance.
","snippet":"The following provides guidance on the application of the liability extinguishment criteria, specifically related to the following:\n(a) In-substance defeasance transactions\n(b) Transfers of noncash financial assets in se…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:7575356a42b7e8c3128a3cb8725aaac68815207356116254b11b2bd955faa586","downloaded_from":"2026-09-10T00:14:05.784Z","last_downloaded_at":"2026-09-10T00:14:05.784Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482534","source_sha256":"24904f5dfb63de58ecf864fe29fb11db40509c23b08b9d8d9242fdb9eeb07e05"}},{"citation":"405-20-55-3","para":"55-3","html":"
In an in-substance defeasance transaction, a debtor transfers essentially risk-free assets to an irrevocable defeasance trust and the cash flows from those assets approximate the scheduled interest and principal payments of the debt being extinguished.
","snippet":"In an in-substance defeasance transaction, a debtor transfers essentially risk-free assets to an irrevocable defeasance trust and the cash flows from those assets approximate the scheduled interest and principal payments…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:6199d24cf169987fbfb760e0d239b39337f4f54d6e8045797e54a19a1f68a74e","downloaded_from":"2026-09-10T00:14:05.784Z","last_downloaded_at":"2026-09-10T00:14:05.784Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482534","source_sha256":"24904f5dfb63de58ecf864fe29fb11db40509c23b08b9d8d9242fdb9eeb07e05"}},{"citation":"405-20-55-4","para":"55-4","html":"
An in-substance defeasance transaction does not meet the derecognition criteria in either Section 405-20-40 for the liability or in Section 860-10-40 for the asset. The transaction does not meet the criteria because of the following:
  1. a
    The debtor is not released from the debt by putting assets in the trust; if the assets in the trust prove insufficient, for example, because a default by the debtor accelerates its debt, the debtor must make up the difference.
  2. b
    The lender is not limited to the cash flows from the assets in trust.
  3. c
    The lender does not have the ability to dispose of the assets at will or to terminate the trust.
  4. d
    If the assets in the trust exceed what is necessary to meet scheduled principal and interest payments, the transferor can remove the assets.
  5. e
    Subparagraph superseded by Accounting Standards Update No. 2012-04.
  6. f
    The debtor does not surrender control of the benefits of the assets because those assets are still being used for the debtor's benefit, to extinguish its debt, and because no asset can be an asset of more than one entity, those benefits must still be the debtor's assets.
","snippet":"An in-substance defeasance transaction does not meet the derecognition criteria in either Section 405-20-40 for the liability or in Section 860-10-40 for the asset. The transaction does not meet the criteria because of t…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:190be3c7c63c240437e4d74f96b50e081f0300552439d0ab7833cabc1771b961","downloaded_from":"2026-09-10T00:14:05.784Z","last_downloaded_at":"2026-09-10T00:14:05.784Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482534","source_sha256":"24904f5dfb63de58ecf864fe29fb11db40509c23b08b9d8d9242fdb9eeb07e05"}},{"citation":"405-20-55-5","para":"55-5","html":"
A cash payment or conveyance of noncash financial assets from a debtor to a creditor results in full or partial settlement of the creditor's receivable from the debtor. Whether or not that settlement is an extinguishment is governed by paragraph 405-20-40-1. However, if a noncash financial asset was conveyed to the creditor in full or partial settlement of a creditor's receivable, it would be rare to conclude that debt has been extinguished if the criteria of paragraph 860-10-40-5 were not also met.
","snippet":"A cash payment or conveyance of noncash financial assets from a debtor to a creditor results in full or partial settlement of the creditor's receivable from the debtor. Whether or not that settlement is an extinguishment…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:230e71b1f139e4061d245c17862122042d439961b71857cb51ced34650f61cc8","downloaded_from":"2026-09-10T00:14:05.784Z","last_downloaded_at":"2026-09-10T00:14:05.784Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482534","source_sha256":"24904f5dfb63de58ecf864fe29fb11db40509c23b08b9d8d9242fdb9eeb07e05"}},{"citation":"405-20-55-6","para":"55-6","html":"
Paragraphs 405-20-55-6 through 55-8 superseded by Accounting Standards Update No. 2009-16.
","snippet":"Paragraphs 405-20-55-6 through 55-8 superseded by Accounting Standards Update No. 2009-16.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:98a3c525cadcb24cb1c30b27d2f591822aac96fb7e66a3bb318a80f2c2a2f831","downloaded_from":"2026-09-10T00:14:05.784Z","last_downloaded_at":"2026-09-10T00:14:05.784Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482534","source_sha256":"24904f5dfb63de58ecf864fe29fb11db40509c23b08b9d8d9242fdb9eeb07e05"}},{"citation":"405-20-55-9","para":"55-9","html":"
In a legal defeasance, generally the creditor legally releases the debtor from being the primary obligor under the liability. Liabilities are extinguished by legal defeasances if the condition in paragraph 405-20-40-1(b) is satisfied. Whether the debtor has in fact been released and the condition in that paragraph has been met is a matter of law. Conversely, in an in-substance defeasance, the debtor is not released from the debt by putting assets in the trust. For the reasons identified in paragraph 405-20-55-4, an in-substance defeasance is different from a legal defeasance and the liability is not extinguished.
","snippet":"In a legal defeasance, generally the creditor legally releases the debtor from being the primary obligor under the liability. Liabilities are extinguished by legal defeasances if the condition in paragraph 405-20-40-1(b)…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:6ee0556ad3276c60630ebad5097b24972930b648337f0747e64c90c159cba6fa","downloaded_from":"2026-09-10T00:14:05.784Z","last_downloaded_at":"2026-09-10T00:14:05.784Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482534","source_sha256":"24904f5dfb63de58ecf864fe29fb11db40509c23b08b9d8d9242fdb9eeb07e05"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:0313433484c3c8f12d824c8f571101c835eabbda2edc534686dcef4928f408ad","downloaded_from":"2026-09-10T00:14:05.784Z","last_downloaded_at":"2026-09-10T00:14:05.784Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482534","source_sha256":"24904f5dfb63de58ecf864fe29fb11db40509c23b08b9d8d9242fdb9eeb07e05"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:c97cfe4c446673c744a927b65812864950471527e70941e5e65ee3b362cf9a35","downloaded_from":"2026-09-10T00:14:05.784Z","last_downloaded_at":"2026-09-10T00:14:05.784Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482534","source_sha256":"24904f5dfb63de58ecf864fe29fb11db40509c23b08b9d8d9242fdb9eeb07e05"}},{"number":"65","label":"65 Transition and Open Effective Date Information","anchor":"65-transition-and-open-effective-date-information","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-20-65-1","para":"65-1","html":"
Paragraph superseded on 08/12/2020 after the end of the transition period stated in Accounting Standards Update No. 2016-04, Liabilities—Extinguishments of Liabilities (Subtopic 405-20): Recognition of Breakage for Certain Prepaid Stored-Value Products.
","snippet":"Paragraph superseded on 08/12/2020 after the end of the transition period stated in Accounting Standards Update No. 2016-04, Liabilities—Extinguishments of Liabilities (Subtopic 405-20): Recognition of Breakage for Certa…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:982478f6f51f48e76594a86dfb4294a8ac4df8fbe96df791a0069efb30f6e75f","downloaded_from":"2026-09-10T00:14:08.518Z","last_downloaded_at":"2026-09-10T00:14:08.518Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482702","source_sha256":"2c66ca240255dcb728add0ad6ca5ddcd18f873099b2cc7befe2790f091c0e303"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:ea1302d43e473390dd5dc50030f426c4055d73a1ceeafb3a08908d88994906f1","downloaded_from":"2026-09-10T00:14:08.518Z","last_downloaded_at":"2026-09-10T00:14:08.518Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482702","source_sha256":"2c66ca240255dcb728add0ad6ca5ddcd18f873099b2cc7befe2790f091c0e303"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:51b47c5bdd2917f593c7481e8ec070d2d180918f87600d19ef52ac49730740c3","downloaded_from":"2026-09-10T00:14:08.518Z","last_downloaded_at":"2026-09-10T00:14:08.518Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482702","source_sha256":"2c66ca240255dcb728add0ad6ca5ddcd18f873099b2cc7befe2790f091c0e303"}}],"enrichment":{"summary":"ASC 405-20 governs when a debtor may derecognize a liability because it has been extinguished. Under 405-20-40-1, extinguishment occurs if and only if the debtor pays the creditor (cash, other financial assets, goods or services, or reacquisition of its own debt securities) and is relieved of the obligation, or the debtor is legally released as primary obligor judicially or by the creditor. The Subtopic also contains special derecognition (breakage) rules for liabilities from prepaid stored-value products and excludes debt conversions and troubled debt restructurings (see 470-20 and 470-60).","key_points":["A debtor shall derecognize a liability if and only if it has been extinguished, meaning either payment with relief of the obligation or legal release as primary obligor (405-20-40-1); a sale plus assumption of nonrecourse debt by a third party in conjunction with sale of the sole collateral asset effectively accomplishes a legal release.","The Subtopic applies to all entities and to extinguishments of all financial and nonfinancial liabilities (including derivative nonfinancial liabilities such as a written commodity option) unless derecognition is addressed elsewhere, such as 924-405 gaming chips or Topic 606 breakage (405-20-15-1 through 15-2).","If a creditor releases the debtor conditioned on a third party assuming the obligation with the original debtor secondarily liable, the original liability is extinguished but the debtor recognizes a guarantee obligation at fair value, which reduces the gain or increases the loss on extinguishment (405-20-40-2; see Topic 460).","In-substance defeasance does not extinguish the liability because the debtor is not released, the lender is not limited to the trust assets, and the debtor retains control of the trust assets' benefits (405-20-55-3 through 55-4); a legal defeasance can extinguish the liability if 405-20-40-1(b) is met, which is a matter of law (405-20-55-9).","For prepaid stored-value products in scope, expected breakage is derecognized in proportion to the pattern of rights expected to be exercised, only to the extent a significant reversal is probable of not occurring; if no breakage is expected, derecognize when the likelihood of exercise becomes remote (405-20-40-4), with estimate updates treated as changes in accounting estimate under 250-10-45-17 through 45-20.","The breakage guidance does not apply to products whose breakage must be remitted under unclaimed property laws, products attached to a segregated bank account, customer loyalty programs, or transactions within other Topics such as 606 (405-20-40-3).","Entities recognizing breakage must disclose the methodology used and significant judgments made in applying it (405-20-50-2); see also 470-50-50-1 for in-substance defeasance disclosure and 860-30-50-1A for assets set aside to satisfy a specific obligation."],"categories":["Derecognition","Financial instruments","Debt and equity","Disclosure"],"audience_level":"intermediate","student_note":"The classic trap is thinking that setting aside dedicated assets (in-substance defeasance) removes the debt from the balance sheet — it does not; only payment with relief or a legal release works. Also remember that a released debtor who becomes secondarily liable must book a fair value guarantee liability that reduces the extinguishment gain.","related_topics":["470-20","470-60","470-50","860-10","460","606"],"key_concepts":["extinguishment of liabilities","derecognition","legal release from primary obligor","in-substance defeasance","legal defeasance","prepaid stored-value products","breakage","guarantee obligation"],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:69943a13636d03fd55b3064543700d496f973f27f3629de79b6a4670541832b2","downloaded_from":"2026-09-10T00:13:46.142Z","last_downloaded_at":"2026-09-10T00:14:11.157Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},"related":[{"number":"470-50","title":"Modifications and Extinguishments","topic_title":"Debt","score":0.7721,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:0e4d80675d064f2b6bdc2bd96ebf70ddca6e887468f3d38ec82e67f6a4178189","downloaded_from":"2026-09-10T00:32:44.546Z","last_downloaded_at":"2026-09-10T00:33:07.253Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"470-60","title":"Troubled Debt Restructurings by Debtors","topic_title":"Debt","score":0.7603,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:abba2f10479ae30c80e210dda1e61fe41316a4a4600f1072d71b6c0d475f6455","downloaded_from":"2026-09-10T00:33:11.172Z","last_downloaded_at":"2026-09-10T00:33:34.628Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"470-980","title":"Regulated Operations","topic_title":"Debt","score":0.7457,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:36ecc25e070cb9a5bb1e6d216241e8a60b965171642f957e5abf9af9a31eb738","downloaded_from":"2026-09-10T00:35:14.586Z","last_downloaded_at":"2026-09-10T00:35:24.744Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"410-20","title":"Asset Retirement Obligations","topic_title":"Asset Retirement and Environmental Obligations","score":0.7323,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:2095b5583ff6e6b6fe36743b57183b166ecbb47aa40afa5e99e5a71239c8083e","downloaded_from":"2026-09-10T00:20:40.400Z","last_downloaded_at":"2026-09-10T00:21:17.061Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"860-30","title":"Secured Borrowing and Collateral","topic_title":"Transfers and Servicing","score":0.729,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:3b4ce46c4d7409e53558c3574c6c37aa9abf6955792af37faf367555db9b3c0e","downloaded_from":"2026-09-10T02:06:50.852Z","last_downloaded_at":"2026-09-10T02:07:35.766Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"470-10","title":"Overall","topic_title":"Debt","score":0.7269,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:e8953d092da873da3326812646d23a318434d1d867172fc04cd009580981935a","downloaded_from":"2026-09-10T00:30:14.064Z","last_downloaded_at":"2026-09-10T00:31:04.047Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}}],"prev":{"number":"405-10","title":"Overall","topic_title":"Liabilities","provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:88f2e1b65329cc1e801c2b78bede055285bfa6d73a9de4b7c8194ba02e577a3e","downloaded_from":"2026-09-10T00:13:36.711Z","last_downloaded_at":"2026-09-10T00:13:43.757Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},"next":{"number":"405-30","title":"Insurance-Related Assessments","topic_title":"Liabilities","provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:544e748d2deb9ed2691cf49df01b66797287eb151417edbf0bbd83c227c0c953","downloaded_from":"2026-09-10T00:14:14.713Z","last_downloaded_at":"2026-09-10T00:14:44.711Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:68d4c8b3d328191691a82bd28ea1c5137c28f4f7cc45f5a0e94ffc7d6e0a5cfb","downloaded_from":"2026-09-10T00:13:46.142Z","last_downloaded_at":"2026-09-10T00:14:11.157Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"405-30","topic":"405","title":"Insurance-Related Assessments","area":"Liabilities","paragraphs":52,"summary":"ASC 405-30 governs when and how entities—insurers and self-insurers alike—accrue liabilities for statutory or regulatory insurance-related assessments such as state guaranty-fund assessments, insurance department administrative assessments, and workers' compensation second-injury fund assessments. A liability is recognized only when an assessment is probable, the obligating event has occurred by the balance sheet date, and the amount is reasonably estimable (405-30-25-1); the obligating event differs by assessment mechanism (retrospective vs. prospective vs. prefunded premium-based, and loss-based). Related recoveries via premium tax offsets or policy surcharges are recognized as assets when probable (405-30-25-8), but recoveries expected only through future premium rate structures are not (405-30-25-10).","concepts":["guaranty-fund assessment","obligating event","formal determination of insolvency","retrospective-premium-based assessment","prospective-premium-based assessment","loss-based assessment","premium tax offset","second-injury fund"],"categories":["Recognition","Subsequent measurement","Contingencies and guarantees","Industry-specific"],"level":"intermediate","topic_title":"Liabilities","sections":[{"number":"00","label":"00 Status","anchor":"00-status","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-30-00-1","para":"00-1","html":"
The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
ReinsuranceAddedAccounting Standards Update No. 2016-1912/14/2016
405-30-05-1AmendedAccounting Standards Update No. 2011-0607/21/2011
405-30-15-3AmendedAccounting Standards Update No. 2016-1912/14/2016
405-30-15-3AmendedAccounting Standards Update No. 2011-0607/21/2011
405-30-30-7AmendedAccounting Standards Update No. 2016-1912/14/2016
","snippet":"The following table identifies the changes made to this Subtopic.\nParagraph | Action | Accounting Standards Update | Date |\n| | | |\nReinsurance | Added | Accounting Standards Update No. 2016-19 | 12/14/2016 |\n| | | |\n405…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:ec36c4b6969a975bf7c5a5f949276ad84ceb50189b28bd9a7193c450a34dd4a3","downloaded_from":"2026-09-10T00:14:14.713Z","last_downloaded_at":"2026-09-10T00:14:14.713Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482653","source_sha256":"e968573df9eb5169cecb92f1f45b590c0500a265db38920b4d3d72672cc17f01"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:27184651173bdaf88a3e498b85ccd9267f26f0ade76bb657c29898dee70a2ee2","downloaded_from":"2026-09-10T00:14:14.713Z","last_downloaded_at":"2026-09-10T00:14:14.713Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482653","source_sha256":"e968573df9eb5169cecb92f1f45b590c0500a265db38920b4d3d72672cc17f01"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:37c2636d34d006e413bef2cb1215c0663b939a6ea1e976c65bab24bda31ad2d2","downloaded_from":"2026-09-10T00:14:14.713Z","last_downloaded_at":"2026-09-10T00:14:14.713Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482653","source_sha256":"e968573df9eb5169cecb92f1f45b590c0500a265db38920b4d3d72672cc17f01"}},{"number":"05","label":"05 Overview and Background","anchor":"05-overview-and-background","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-30-05-1","para":"05-1","html":"
Insurance entities as well as noninsurance entities are subject to a variety of assessments related to insurance activities, including those by state guaranty funds and workers' compensation second-injury funds. Some entities may be subject to insurance-related assessments because they self-insure against loss or liability. This Subtopic provides guidance on accounting for insurance-related assessments. The annual fee imposed on health insurers by the Patient Protection and Affordable Care Act as amended by the Health Care and Education Reconciliation Act (the Acts) is not considered an insurance-related assessment. The accounting for the Acts' fee is addressed in Subtopic 720-50.
","snippet":"Insurance entities as well as noninsurance entities are subject to a variety of assessments related to insurance activities, including those by state guaranty funds and workers' compensation second-injury funds. Some ent…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:5f2593e713bdb5cdc70288e190dfbb2b1e6a407321fc896f9a8adaad99bc66a9","downloaded_from":"2026-09-10T00:14:16.426Z","last_downloaded_at":"2026-09-10T00:14:16.426Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482629","source_sha256":"ae75d6f1d0a70d48ec1fc58b7bfe18e5a389807ae1d7034e65f37d20dae37134"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:ba132c04467d8386adaa4df1c3ce5c72fcbafed5a1df7af4f7159736da0e37d3","downloaded_from":"2026-09-10T00:14:16.426Z","last_downloaded_at":"2026-09-10T00:14:16.426Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482629","source_sha256":"ae75d6f1d0a70d48ec1fc58b7bfe18e5a389807ae1d7034e65f37d20dae37134"}},{"block":null,"heading":"State Guaranty Funds","paragraphs":[{"citation":"405-30-05-2","para":"05-2","html":"
States have enacted legislation establishing guaranty funds. The state guaranty funds assess entities licensed to sell insurance in the state to provide for the payment of covered claims or to meet other insurance obligations—subject to prescribed limits—of insolvent insurance entities. The assessments are generally based on premium volume for certain covered lines of business. Most state guaranty funds assess entities for costs related to a particular insolvency after the insolvency occurs. At least one state, however, assesses entities before insolvencies.
","snippet":"States have enacted legislation establishing guaranty funds. The state guaranty funds assess entities licensed to sell insurance in the state to provide for the payment of covered claims or to meet other insurance obliga…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:faf64a69824e3ba3c91fd51ffd4569e9ab133a707725eafdef93cbdb77be82e1","downloaded_from":"2026-09-10T00:14:16.426Z","last_downloaded_at":"2026-09-10T00:14:16.426Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482629","source_sha256":"ae75d6f1d0a70d48ec1fc58b7bfe18e5a389807ae1d7034e65f37d20dae37134"}},{"citation":"405-30-05-3","para":"05-3","html":"
State guaranty funds use a variety of methods for assessing entities. This Subtopic identifies the following four primary methods of guaranty-fund assessments:
  1. a
    Retrospective-premium-based assessments. Guaranty funds covering benefit payments of insolvent life, annuity, and health insurance entities typically assess entities based on premiums written or received in one or more years before the year of insolvency. Assessments in any year are generally limited to an established percentage of an entity's average premiums for the three years preceding the insolvency. Assessments for a given insolvency may take place over several years.
  2. b
    Prospective-premium-based assessments. Guaranty funds covering claims of insolvent property and casualty insurance entities typically assess entities based on premiums written in one or more years after the insolvency. Assessments in any year are generally limited to an established percentage of an entity's premiums written or received for the year preceding the assessment. Assessments for a given insolvency may take place over several years.
  3. c
    Prefunded-premium-based assessments. At least one state uses this kind of assessment to cover claims of insolvent property and casualty insurance entities. This kind of assessment is intended to prefund the costs of future insolvencies. Assessments are imposed before any particular insolvency and are based on the current level of written premiums. Rates to be applied to future premiums are adjusted as necessary.
  4. d
    Administrative-type assessments. These assessments are typically a flat (annual) amount per entity to fund operations of the guaranty association, regardless of the existence of an insolvency.
","snippet":"State guaranty funds use a variety of methods for assessing entities. This Subtopic identifies the following four primary methods of guaranty-fund assessments:\n(a) Retrospective-premium-based assessments. Guaranty funds …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:5552c32756d6ed4d94b5db52a93fa818c2498776d248e5342f39d8e32f72e6e3","downloaded_from":"2026-09-10T00:14:16.426Z","last_downloaded_at":"2026-09-10T00:14:16.426Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482629","source_sha256":"ae75d6f1d0a70d48ec1fc58b7bfe18e5a389807ae1d7034e65f37d20dae37134"}},{"citation":"405-30-05-4","para":"05-4","html":"
State laws often allow for recoveries of guaranty-fund assessments by entities subject to assessments through such mechanisms as premium tax offsets, policy surcharges, and future premium rate structures. The policy surcharges referred to in this Subtopic are those surcharges that are intended to provide an opportunity for assessed entities to recover some or all of the amounts assessed over a period of time.
","snippet":"State laws often allow for recoveries of guaranty-fund assessments by entities subject to assessments through such mechanisms as premium tax offsets, policy surcharges, and future premium rate structures. The policy surc…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:4c6c4576272a885575b26cac4211c183a071d9056f0b8b65486ca01e6e5fc440","downloaded_from":"2026-09-10T00:14:16.426Z","last_downloaded_at":"2026-09-10T00:14:16.426Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482629","source_sha256":"ae75d6f1d0a70d48ec1fc58b7bfe18e5a389807ae1d7034e65f37d20dae37134"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:b87778ba3493ace754f3f1a014cbc3a1dd2b2ec9b5d2b0b55579dfce74ae27e4","downloaded_from":"2026-09-10T00:14:16.426Z","last_downloaded_at":"2026-09-10T00:14:16.426Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482629","source_sha256":"ae75d6f1d0a70d48ec1fc58b7bfe18e5a389807ae1d7034e65f37d20dae37134"}},{"block":null,"heading":"Other Insurance-Related Assessments","paragraphs":[{"citation":"405-30-05-5","para":"05-5","html":"
Entities are subject to a variety of other insurance-related assessments. Many states and a number of local governmental units have established other funds supported by assessments. The two most prevalent uses for such assessments are as follows:
  1. a
    To fund operating expenses of state insurance regulatory bodies (for example, the state insurance department or workers' compensation board)
  2. b
    To fund second-injury funds, which provide reimbursement to insurance carriers or employers for workers' compensation claims when the cost of a second injury combined with a prior accident or disability is greater than what the second accident alone would have produced. The employer of an injured or handicapped worker is responsible only for the workers' compensation benefit for the most recent injury; the second-injury fund would cover the cost of any additional benefits for aggravation of a prior condition or injury. The intent of the fund is to help insure that employers are not made to suffer a greater monetary loss or increased insurance costs because of hiring previously injured or handicapped employees.
","snippet":"Entities are subject to a variety of other insurance-related assessments. Many states and a number of local governmental units have established other funds supported by assessments. The two most prevalent uses for such a…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:b1304c0fdfe3029e0f73679c62ec900d36e9f6581ee04f5d00d13d13ed6cc314","downloaded_from":"2026-09-10T00:14:16.426Z","last_downloaded_at":"2026-09-10T00:14:16.426Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482629","source_sha256":"ae75d6f1d0a70d48ec1fc58b7bfe18e5a389807ae1d7034e65f37d20dae37134"}},{"citation":"405-30-05-6","para":"05-6","html":"
The primary methods used to assess for these other insurance-related assessments are the following:
  1. a
    Premium-based. The assessing entity imposes the assessment based on the entity's written premiums. The assessing entity may be at the state, county, municipality, or other such level. The base year of premiums is generally either the current year or the year preceding the assessment.
  2. b
    Loss-based. The assessing entity imposes the assessment based on the entity's incurred losses or paid losses in relation to that amount for all entities subject to that assessment in the particular jurisdiction.
","snippet":"The primary methods used to assess for these other insurance-related assessments are the following:\n(a) Premium-based. The assessing entity imposes the assessment based on the entity's written premiums. The assessing ent…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8b033e43f1c7bf219f5b34d705460e7077660a6194eb7b5736f7d617fa0cf098","downloaded_from":"2026-09-10T00:14:16.426Z","last_downloaded_at":"2026-09-10T00:14:16.426Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482629","source_sha256":"ae75d6f1d0a70d48ec1fc58b7bfe18e5a389807ae1d7034e65f37d20dae37134"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:b3b26cd614a832e64405fb1cb2079c1386681db50da32b32a708675e2226fb56","downloaded_from":"2026-09-10T00:14:16.426Z","last_downloaded_at":"2026-09-10T00:14:16.426Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482629","source_sha256":"ae75d6f1d0a70d48ec1fc58b7bfe18e5a389807ae1d7034e65f37d20dae37134"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:3d3815466f5e5d5777787f745cfc24011b7336efe3d75b5d84177b28986b8fa5","downloaded_from":"2026-09-10T00:14:16.426Z","last_downloaded_at":"2026-09-10T00:14:16.426Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482629","source_sha256":"ae75d6f1d0a70d48ec1fc58b7bfe18e5a389807ae1d7034e65f37d20dae37134"}},{"number":"10","label":"10 Objectives","anchor":"10-objectives","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-30-10-1","para":"10-1","html":"
The objective of this Subtopic is to establish consistent accounting and disclosures for guaranty-fund and other insurance-related assessments to improve comparability of reported information.
","snippet":"The objective of this Subtopic is to establish consistent accounting and disclosures for guaranty-fund and other insurance-related assessments to improve comparability of reported information.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:5edaf5588ca1e1f950ac994d8e7965bd52ddf8288e225a2401143980861819a0","downloaded_from":"2026-09-10T00:14:18.183Z","last_downloaded_at":"2026-09-10T00:14:18.183Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482607","source_sha256":"026fe86c45140c1686a5cb13abc7174c27ecbc35198e1efce991a7cf7d7d9226"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:636d7aeed4e32770f033efc8b866c17bc062ed2f9c2f299cb38be35c8b4e88ed","downloaded_from":"2026-09-10T00:14:18.183Z","last_downloaded_at":"2026-09-10T00:14:18.183Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482607","source_sha256":"026fe86c45140c1686a5cb13abc7174c27ecbc35198e1efce991a7cf7d7d9226"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:16cbe4b0b6ccd7fe1ff2caee1a27482c70c84289447739f33c523b0bd89bfd08","downloaded_from":"2026-09-10T00:14:18.183Z","last_downloaded_at":"2026-09-10T00:14:18.183Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482607","source_sha256":"026fe86c45140c1686a5cb13abc7174c27ecbc35198e1efce991a7cf7d7d9226"}},{"number":"15","label":"15 Scope and Scope Exceptions","anchor":"15-scope-and-scope-exceptions","is_sec":false,"groups":[{"block":null,"heading":"Entities","paragraphs":[{"citation":"405-30-15-1","para":"15-1","html":"
The guidance in this Subtopic applies to all entities that are subject to guaranty-fund and other insurance-related assessments, including entities that are subject to insurance-related assessments because they self-insure against loss or liability. For example, one state specifies that self-insurers of workers' compensation should use as a base for assessment the amount of premium the self-insurer would have paid if it had insured its liability with an insurer for the previous calendar year.
","snippet":"The guidance in this Subtopic applies to all entities that are subject to guaranty-fund and other insurance-related assessments, including entities that are subject to insurance-related assessments because they self-insu…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:bf8ee50b34ade6d2a9c5c3dab295a689cd0b02e7c0d034662093fdf373867713","downloaded_from":"2026-09-10T00:14:22.271Z","last_downloaded_at":"2026-09-10T00:14:22.271Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482578","source_sha256":"448643e10d2a436c85dce85920636d8f043b73c78f59caa7a5fd0b7f6e8f374c"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:d6dffd783034e25f4826685f2622984d961c5d4e98b4e62374b6f2ff7a7a2862","downloaded_from":"2026-09-10T00:14:22.271Z","last_downloaded_at":"2026-09-10T00:14:22.271Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482578","source_sha256":"448643e10d2a436c85dce85920636d8f043b73c78f59caa7a5fd0b7f6e8f374c"}},{"block":null,"heading":"Transactions","paragraphs":[{"citation":"405-30-15-2","para":"15-2","html":"
The guidance in this Subtopic applies to assessments mandated by statute or regulatory authority that are related directly or indirectly to underwriting activities (including self-insurance), except for income taxes and premium taxes.
","snippet":"The guidance in this Subtopic applies to assessments mandated by statute or regulatory authority that are related directly or indirectly to underwriting activities (including self-insurance), except for income taxes and …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:06fdddf29444a58002d7a1da3253685f07a8050450bef6a5b6036d0d7e91a5f0","downloaded_from":"2026-09-10T00:14:22.271Z","last_downloaded_at":"2026-09-10T00:14:22.271Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482578","source_sha256":"448643e10d2a436c85dce85920636d8f043b73c78f59caa7a5fd0b7f6e8f374c"}},{"citation":"405-30-15-3","para":"15-3","html":"
The guidance in this Subtopic does not apply to the following transactions and activities:
  1. a
    Amounts payable or paid as a result of reinsurance contracts or arrangements that are in substance reinsurance, including assumed reinsurance activities and certain involuntary pools that are covered by Topic 944.
  2. b
    Assessments of depository institutions related to bank insurance and similar funds.
  3. c
    The annual fee imposed on health insurers by the Patient Protection and Affordable Care Act as amended by the Health Care and Education Reconciliation Act (the Acts). The accounting for the Acts' fee is addressed in Subtopic 720-50.
","snippet":"The guidance in this Subtopic does not apply to the following transactions and activities:\n(a) Amounts payable or paid as a result of reinsurance contracts or arrangements that are in substance reinsurance, including ass…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8534a9037f9a4cf6688df2e3733678b892a6e0ae0d87d49938286f3d6a714d79","downloaded_from":"2026-09-10T00:14:22.271Z","last_downloaded_at":"2026-09-10T00:14:22.271Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482578","source_sha256":"448643e10d2a436c85dce85920636d8f043b73c78f59caa7a5fd0b7f6e8f374c"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:fe6c37ee02fa3be8097013181cd7a2b540965821ffb8b55907b9d02847e6a752","downloaded_from":"2026-09-10T00:14:22.271Z","last_downloaded_at":"2026-09-10T00:14:22.271Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482578","source_sha256":"448643e10d2a436c85dce85920636d8f043b73c78f59caa7a5fd0b7f6e8f374c"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:a1ba8bf5f08cd30d76e2c7614179e1157585fd41bce4175238600febcef64130","downloaded_from":"2026-09-10T00:14:22.271Z","last_downloaded_at":"2026-09-10T00:14:22.271Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482578","source_sha256":"448643e10d2a436c85dce85920636d8f043b73c78f59caa7a5fd0b7f6e8f374c"}},{"number":"25","label":"25 Recognition","anchor":"25-recognition","is_sec":false,"groups":[{"block":null,"heading":"Reporting Liabilities","paragraphs":[{"citation":"405-30-25-1","para":"25-1","html":"
Entities subject to assessments shall recognize liabilities for insurance-related assessments when all of the following conditions are met:
  1. a
    Probability of assessment. An assessment has been imposed or information available before the financial statements are issued or are available to be issued (as discussed in Section 855-10-25) indicates it is probable that an assessment will be imposed.
  2. b
    Obligating event. The event obligating an entity to pay (underlying cause of) an imposed or probable assessment has occurred on or before the date of the financial statements.
  3. c
    Ability to reasonably estimate. The amount of the assessment can be reasonably estimated.
See Examples 1 through 3 (paragraphs
405-30-55-1 through 55-15
) for illustrations of the computation of assessment liabilities.
","snippet":"Entities subject to assessments shall recognize liabilities for insurance-related assessments when all of the following conditions are met:\n(a) Probability of assessment. An assessment has been imposed or information ava…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:4b9f7865795685db142b3431f61ebdfc632c9682124f6b8cc606a6b404a94880","downloaded_from":"2026-09-10T00:14:28.313Z","last_downloaded_at":"2026-09-10T00:14:28.313Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482530","source_sha256":"9bf45f7f7fd6d7731daf3c5f572aaa3529c44d524eb6f0b68f87d734d348642f"}},{"citation":"405-30-25-2","para":"25-2","html":"
Premium-based guaranty-fund assessments, except those that are prefunded, are presumed probable when a formal determination of insolvency occurs, and presumed not probable before a formal determination of insolvency. For purposes of this Subtopic, a formal determination of insolvency occurs when an entity meets a state's (ordinarily the state of domicile of the insolvent insurer) statutory definition of an insolvent insurer. In most states, the entity must be declared to be financially insolvent by a court of competent jurisdiction. In some states, there must also be a final order of liquidation.
","snippet":"Premium-based guaranty-fund assessments, except those that are prefunded, are presumed probable when a formal determination of insolvency occurs, and presumed not probable before a formal determination of insolvency. For…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:3866355760c1e97cfdb1f84952e6666be7a8c8439703ceb5836a4f186f2edc99","downloaded_from":"2026-09-10T00:14:28.313Z","last_downloaded_at":"2026-09-10T00:14:28.313Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482530","source_sha256":"9bf45f7f7fd6d7731daf3c5f572aaa3529c44d524eb6f0b68f87d734d348642f"}},{"citation":"405-30-25-3","para":"25-3","html":"
Prefunded guaranty-fund assessments and premium-based administrative-type assessments, as defined in paragraph 405-30-05-3, are presumed probable when the premiums on which the assessments are expected to be based are written. Loss-based administrative-type and second-injury fund assessments are presumed probable when the losses on which the assessments are expected to be based are incurred.
","snippet":"Prefunded guaranty-fund assessments and premium-based administrative-type assessments, as defined in paragraph 405-30-05-3, are presumed probable when the premiums on which the assessments are expected to be based are wr…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:65256ffce3ea46e07e2d3b55d12d7b53cac82e080deee063c4e2ea1dfba43f93","downloaded_from":"2026-09-10T00:14:28.313Z","last_downloaded_at":"2026-09-10T00:14:28.313Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482530","source_sha256":"9bf45f7f7fd6d7731daf3c5f572aaa3529c44d524eb6f0b68f87d734d348642f"}},{"citation":"405-30-25-4","para":"25-4","html":"
Because of the fundamental differences in how assessment mechanisms operate, the event that makes an assessment probable (for example, an insolvency) may not be the event that obligates an entity. The following defines the event that obligates an entity to pay an assessment for each kind of assessment identified in this Subtopic:
  1. a
    For premium-based assessments, the event that obligates the entity is generally writing the premiums or becoming obligated to write or renew (such as multiple-year, noncancelable policies) the premiums on which the assessments are expected to be based. Some states, through law or regulatory practice, provide that an insurance entity cannot avoid paying a particular assessment even if that insurance entity reduces its premium writing in the future. In such circumstances, the event that obligates the entity is a formal determination of insolvency or similar triggering event. For example, in certain states, an insurance entity may remain liable for assessments even though the insurance entity discontinues the writing of premiums. In this circumstance, the underlying cause of the liability is not the writing of the premium, but the insolvency. Regulatory practice would be determined based on the stated intentions or prior history of the insurance regulators.
  2. b
    For loss-based assessments, the event that obligates an entity is an entity's incurring the losses on which the assessments are expected to be based.
","snippet":"Because of the fundamental differences in how assessment mechanisms operate, the event that makes an assessment probable (for example, an insolvency) may not be the event that obligates an entity. The following defines t…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:671d82e9e299ad2627b38300fd0d456bf5f860d401f5e8dd2393d5718a824d6f","downloaded_from":"2026-09-10T00:14:28.313Z","last_downloaded_at":"2026-09-10T00:14:28.313Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482530","source_sha256":"9bf45f7f7fd6d7731daf3c5f572aaa3529c44d524eb6f0b68f87d734d348642f"}},{"citation":"405-30-25-5","para":"25-5","html":"
One of the conditions (see paragraph 450-20-25-2(b)) for recognition of a liability is that the amount can be reasonably estimated. Paragraph 450-20-25-5 provides that some amount of loss can be reasonably estimated when available information indicates that the estimated amount of the loss is within a range of amounts. Paragraph 450-20-30-1 explains that, if no amount within the range is a better estimate than any other amount, the minimum amount in the range should be accrued.
","snippet":"One of the conditions (see paragraph 450-20-25-2(b)) for recognition of a liability is that the amount can be reasonably estimated. Paragraph 450-20-25-5 provides that some amount of loss can be reasonably estimated when…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:11abafc5c6a360412796341cb3200467b396286d215b3d5d654d562c2b7f545e","downloaded_from":"2026-09-10T00:14:28.313Z","last_downloaded_at":"2026-09-10T00:14:28.313Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482530","source_sha256":"9bf45f7f7fd6d7731daf3c5f572aaa3529c44d524eb6f0b68f87d734d348642f"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:37efcdac50c3055fde8454aba0355285f35471c366af974ca9659da46abaf292","downloaded_from":"2026-09-10T00:14:28.313Z","last_downloaded_at":"2026-09-10T00:14:28.313Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482530","source_sha256":"9bf45f7f7fd6d7731daf3c5f572aaa3529c44d524eb6f0b68f87d734d348642f"}},{"block":null,"heading":"Applying the Recognition Criteria","paragraphs":[{"citation":"405-30-25-6","para":"25-6","html":"
Application of the recognition criteria in paragraphs
405-30-25-1 through 25-5
to the methods used to address guaranty-fund assessments and other insurance-related assessments, as described in paragraphs
405-30-05-3 through 05-6
, is as follows:
  1. a
    Retrospective-premium-based guaranty-fund assessments. An assessment is probable of being imposed when a formal determination of insolvency occurs. At that time, the premium that obligates the entity for the assessment liability has already been written. Accordingly, an entity that has the ability to reasonably estimate the amount of the assessment shall recognize a liability for the entire amount of future assessments related to a particular insolvency when a formal determination of insolvency is rendered.
  2. b
    Prospective-premium-based guaranty-fund assessments. The event that obligates the entity for the assessment liability generally is the writing of, or becoming obligated to write or renew, the premiums on which the expected future assessments are to be based (for example, multiple-year contracts under which an insurance entity has no discretion to avoid writing future premiums). Therefore, the event that obligates the entity generally will not have occurred at the time of the insolvency. Law or regulatory practice affects the event that obligates the entity in either of the following ways:
    1. 1
      In states that, through law or regulatory practice, provide that an entity cannot avoid paying a particular assessment in the future (even if the entity reduces premium writings in the future), the event that obligates the entity is a formal determination of insolvency or a similar event. An entity that has the ability to reasonably estimate the amount of the assessment shall recognize a liability for the entire amount of future assessments that cannot be avoided related to a particular insolvency when a formal determination of insolvency occurs.
    2. 2
      In states without such a law or regulatory practice, the event that obligates the entity is the writing of, or becoming obligated to write, the premiums on which the expected future assessments are to be based. An entity that has the ability to reasonably estimate the amount of the assessments shall recognize a liability when the related premiums are written or when the entity becomes obligated to write the premiums.
  3. c
    Prefunded-premium-based guaranty-fund assessments. A liability for an assessment arises when premiums are written. Accordingly, an entity that has the ability to reasonably estimate the amount of the assessment shall recognize a liability as the related premiums are written.
  4. d
    Other premium-based assessments. Other premium-based assessments, as described in paragraph 405-30-05-5, would be accounted for in the same manner as prefunded-premium-based guaranty-fund assessments.
  5. e
    Loss-based assessments. An assessment is probable of being asserted when the loss occurs. The obligating event of the assessment also has occurred when the loss occurs. Accordingly, an entity that has the ability to reasonably estimate the amount of the assessment shall recognize a liability as the related loss is incurred.
","snippet":"Application of the recognition criteria in paragraphs 405-30-25-1 through 25-5 to the methods used to address guaranty-fund assessments and other insurance-related assessments, as described in paragraphs 405-30-05-3 thro…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:b35fae3faf1e838bcbd2454ab0189caa7e285620e5b9db133e10b491236e339f","downloaded_from":"2026-09-10T00:14:28.313Z","last_downloaded_at":"2026-09-10T00:14:28.313Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482530","source_sha256":"9bf45f7f7fd6d7731daf3c5f572aaa3529c44d524eb6f0b68f87d734d348642f"}},{"citation":"405-30-25-7","para":"25-7","html":"
Administrative-type assessments are generally expensed in the period assessed.
","snippet":"Administrative-type assessments are generally expensed in the period assessed.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f7fda36aa8f851f68805dcfc5bb33f3a23f01f1231d79ca13842578ea2a3081c","downloaded_from":"2026-09-10T00:14:28.313Z","last_downloaded_at":"2026-09-10T00:14:28.313Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482530","source_sha256":"9bf45f7f7fd6d7731daf3c5f572aaa3529c44d524eb6f0b68f87d734d348642f"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:dbc32862d59e93d658666b92f042df9ede2b4c98a8e2957399eba3916cf68202","downloaded_from":"2026-09-10T00:14:28.313Z","last_downloaded_at":"2026-09-10T00:14:28.313Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482530","source_sha256":"9bf45f7f7fd6d7731daf3c5f572aaa3529c44d524eb6f0b68f87d734d348642f"}},{"block":null,"heading":"Asset for Premium Tax Offsets and Policy Surcharges","paragraphs":[{"citation":"405-30-25-8","para":"25-8","html":"
When it is probable that a paid or accrued assessment will result in an amount that is recoverable from premium tax offsets or policy surcharges, an asset shall be recognized for that recovery.
","snippet":"When it is probable that a paid or accrued assessment will result in an amount that is recoverable from premium tax offsets or policy surcharges, an asset shall be recognized for that recovery.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:e75b30d950d07ff81d394b7b0c70fab6ec39be603efbe4d583810c6f638bc6eb","downloaded_from":"2026-09-10T00:14:28.313Z","last_downloaded_at":"2026-09-10T00:14:28.313Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482530","source_sha256":"9bf45f7f7fd6d7731daf3c5f572aaa3529c44d524eb6f0b68f87d734d348642f"}},{"citation":"405-30-25-9","para":"25-9","html":"
For retrospective-premium-based assessments, to the extent that it is probable that paid or accrued assessments will result in a recoverable amount in a future period from business currently in force considering appropriate persistency rates for long-duration contracts (see paragraph 405-30-30-11), an asset shall be recognized at the time the liability is recorded.
","snippet":"For retrospective-premium-based assessments, to the extent that it is probable that paid or accrued assessments will result in a recoverable amount in a future period from business currently in force considering appropri…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:782c5d372ff98c8b15dc33f61e15da646f9563eddbceed7e6c2cdf834688dda5","downloaded_from":"2026-09-10T00:14:28.313Z","last_downloaded_at":"2026-09-10T00:14:28.313Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482530","source_sha256":"9bf45f7f7fd6d7731daf3c5f572aaa3529c44d524eb6f0b68f87d734d348642f"}},{"citation":"405-30-25-10","para":"25-10","html":"
An asset shall not be established for paid or accrued assessments that are recoverable through future premium rate structures.
","snippet":"An asset shall not be established for paid or accrued assessments that are recoverable through future premium rate structures.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:9076338f21299560ed186ae447a1ae7f2cd23ff27e809901338ef78c9b823a98","downloaded_from":"2026-09-10T00:14:28.313Z","last_downloaded_at":"2026-09-10T00:14:28.313Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482530","source_sha256":"9bf45f7f7fd6d7731daf3c5f572aaa3529c44d524eb6f0b68f87d734d348642f"}},{"citation":"405-30-25-11","para":"25-11","html":"
Policy surcharges that are required as a pass-through to the state or other regulatory bodies shall be accounted for in a manner such that amounts collected or receivable are not recorded as revenues and amounts due or paid are not expensed (meaning, similar to accounting for sales tax).
","snippet":"Policy surcharges that are required as a pass-through to the state or other regulatory bodies shall be accounted for in a manner such that amounts collected or receivable are not recorded as revenues and amounts due or p…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:457c184cb13488b747629acbd2eeeee8c282dc9d4102cddcd3360a5e65dc48bb","downloaded_from":"2026-09-10T00:14:28.313Z","last_downloaded_at":"2026-09-10T00:14:28.313Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482530","source_sha256":"9bf45f7f7fd6d7731daf3c5f572aaa3529c44d524eb6f0b68f87d734d348642f"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:53cebb4924f9b2632b22b06ee4b1e876e5d5411bf4be3a2c69a41bf0084d3c48","downloaded_from":"2026-09-10T00:14:28.313Z","last_downloaded_at":"2026-09-10T00:14:28.313Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482530","source_sha256":"9bf45f7f7fd6d7731daf3c5f572aaa3529c44d524eb6f0b68f87d734d348642f"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:35a21475052ae1f4c1556917b08ce270264b4eb9b15779a9b6584e54c3f422d3","downloaded_from":"2026-09-10T00:14:28.313Z","last_downloaded_at":"2026-09-10T00:14:28.313Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482530","source_sha256":"9bf45f7f7fd6d7731daf3c5f572aaa3529c44d524eb6f0b68f87d734d348642f"}},{"number":"30","label":"30 Initial Measurement","anchor":"30-initial-measurement","is_sec":false,"groups":[{"block":null,"heading":"Estimating the Liability","paragraphs":[{"citation":"405-30-30-1","para":"30-1","html":"
Entities subject to assessments may be able to obtain information to assist in estimating the total guaranty-fund cost or the following years' assessments, as appropriate, for an insolvency from entities such as the state guaranty fund associations, the National Organization of Life and Health Insurance Guaranty Associations, and the National Conference of Insurance Guaranty Funds.
","snippet":"Entities subject to assessments may be able to obtain information to assist in estimating the total guaranty-fund cost or the following years' assessments, as appropriate, for an insolvency from entities such as the stat…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:d77e87949b75a420f24aaac05077377788e0d5a46610c8e0a81a05dc91b6f620","downloaded_from":"2026-09-10T00:14:32.244Z","last_downloaded_at":"2026-09-10T00:14:32.244Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482698","source_sha256":"9017493a8aa97d88bf0bffe1b392da9e0ab8a2b88c172d42ef680e169416cadc"}},{"citation":"405-30-30-2","para":"30-2","html":"
An entity need not be able to compute the exact amounts of the assessments or be formally notified of such assessments by a guaranty fund to make a reasonable estimate of its liability. Entities subject to assessments may have to make assumptions about future events, such as when the fund will incur costs and pay claims that will determine the amounts and the timing of assessments.
","snippet":"An entity need not be able to compute the exact amounts of the assessments or be formally notified of such assessments by a guaranty fund to make a reasonable estimate of its liability. Entities subject to assessments ma…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:4161bbad6346dcf834b30b69f1cabed1b98e9cddd0815b8f1a1e6fccf9cf6066","downloaded_from":"2026-09-10T00:14:32.244Z","last_downloaded_at":"2026-09-10T00:14:32.244Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482698","source_sha256":"9017493a8aa97d88bf0bffe1b392da9e0ab8a2b88c172d42ef680e169416cadc"}},{"citation":"405-30-30-3","para":"30-3","html":"
The best available information about market share or premiums by state and premiums by line of business shall be used to estimate the amount of an insurance entity's future assessments.
","snippet":"The best available information about market share or premiums by state and premiums by line of business shall be used to estimate the amount of an insurance entity's future assessments.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:c7209dda12210a710b3e7119365fa26325dc2cb3a3a7fd4504744a134170f5bf","downloaded_from":"2026-09-10T00:14:32.244Z","last_downloaded_at":"2026-09-10T00:14:32.244Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482698","source_sha256":"9017493a8aa97d88bf0bffe1b392da9e0ab8a2b88c172d42ef680e169416cadc"}},{"citation":"405-30-30-4","para":"30-4","html":"
If a noninsurance entity's assessments are based on premiums, it may be necessary to consider the amount of premium the self-insurer would have paid if it had insured its liability with an insurer. If a noninsurance entity's assessments are based on losses, it shall consider the losses that have been incurred by the entity when determining the liability. Most often, assessments that have an impact on noninsurance entities that self-insure workers' compensation obligations are for second-injury funds. Second-injury funds generally assess insurance entities and self-insurers based on paid losses.
","snippet":"If a noninsurance entity's assessments are based on premiums, it may be necessary to consider the amount of premium the self-insurer would have paid if it had insured its liability with an insurer. If a noninsurance enti…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:81e352f23b3f5b692986b85e6007566ba13a660f502bd6b0b6bb897fdb4a7855","downloaded_from":"2026-09-10T00:14:32.244Z","last_downloaded_at":"2026-09-10T00:14:32.244Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482698","source_sha256":"9017493a8aa97d88bf0bffe1b392da9e0ab8a2b88c172d42ef680e169416cadc"}},{"citation":"405-30-30-5","para":"30-5","html":"
A noninsurance entity may develop an accrual for its second-injury liability based on any of the following:
  1. a
    The ratio of the entity's prior period paid workers' compensation claims to aggregate workers' compensation claims in the state that was used as a basis for previous assessments
  2. b
    Total fund assessments in prior periods
  3. c
    Known changes in the current period to either the number of employees self-insured by the entity or the number of workers who are the subject of recoveries from the second-injury fund that might alter total fund assessments and the entity's proportion of the total fund assessments.
","snippet":"A noninsurance entity may develop an accrual for its second-injury liability based on any of the following:\n(a) The ratio of the entity's prior period paid workers' compensation claims to aggregate workers' compensation …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:d43e81158166da5c5781bbf95327770f87c6b02764bd6473e9a29dcda906a7e3","downloaded_from":"2026-09-10T00:14:32.244Z","last_downloaded_at":"2026-09-10T00:14:32.244Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482698","source_sha256":"9017493a8aa97d88bf0bffe1b392da9e0ab8a2b88c172d42ef680e169416cadc"}},{"citation":"405-30-30-6","para":"30-6","html":"
Estimates of loss-based assessments shall be consistent with estimates of the underlying incurred losses and shall be developed based on enacted laws or regulations and expected assessment rates.
","snippet":"Estimates of loss-based assessments shall be consistent with estimates of the underlying incurred losses and shall be developed based on enacted laws or regulations and expected assessment rates.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f46330a13319e276f14ca6a07d0986249a10170129d6b2806d9fa9d6887211d2","downloaded_from":"2026-09-10T00:14:32.244Z","last_downloaded_at":"2026-09-10T00:14:32.244Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482698","source_sha256":"9017493a8aa97d88bf0bffe1b392da9e0ab8a2b88c172d42ef680e169416cadc"}},{"citation":"405-30-30-7","para":"30-7","html":"
Estimates of some insurance-related assessment liabilities may be difficult to derive. The development or determination of estimates is particularly difficult for guaranty-fund assessments because of uncertainties about the cost of the insolvency to the guaranty fund and the portion that will be recovered through assessment. Examples of uncertainties include the following:
  1. a
    Limitations, as provided by statute, on the amount of individual contract liabilities that the guaranty fund will assume, that cause the guaranty fund associations' liability to be less than the amount by which the entity is insolvent
  2. b
    Contract provisions (for example, credited rates) that may be modified at the time of the insolvency or alternative payout options that may be offered to contract holders that affect the level and payout of the guaranty fund's liability
  3. c
    The extent and timing of available reinsurance recoveries, which may be subject to significant uncertainties
  4. d
    Alternative strategies for the liquidation of assets of the insolvent entity that affect the timing and level of assessments
  5. e
    Certain liabilities of the insolvent insurer that may be particularly difficult to estimate (for example, asbestos or environmental liabilities).
","snippet":"Estimates of some insurance-related assessment liabilities may be difficult to derive. The development or determination of estimates is particularly difficult for guaranty-fund assessments because of uncertainties about …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:70d08640ac5b044e3eb8d7a83f26b058afd82b9a0c09a28c47bb3b857a62f4e1","downloaded_from":"2026-09-10T00:14:32.244Z","last_downloaded_at":"2026-09-10T00:14:32.244Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482698","source_sha256":"9017493a8aa97d88bf0bffe1b392da9e0ab8a2b88c172d42ef680e169416cadc"}},{"citation":"405-30-30-8","para":"30-8","html":"
Because of the uncertainties surrounding some insurance-related assessments, the range of assessment liability may have to be reevaluated regularly during the assessment process. For some ranges, there may be amounts that appear to be better estimates than any other within the range. If this is the case, the liability recorded shall be based on the best estimate within the range. For ranges in which there is no such best estimate, the liability that should be recorded shall be based on the amount representing the minimum amount in the range.
","snippet":"Because of the uncertainties surrounding some insurance-related assessments, the range of assessment liability may have to be reevaluated regularly during the assessment process. For some ranges, there may be amounts tha…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:581d8088826f3b403a56b0c471649879e03ab317b87d5ccb1e41ae7c2c9ddd61","downloaded_from":"2026-09-10T00:14:32.244Z","last_downloaded_at":"2026-09-10T00:14:32.244Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482698","source_sha256":"9017493a8aa97d88bf0bffe1b392da9e0ab8a2b88c172d42ef680e169416cadc"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:2c399873a054956a28a1aaf70476090e40ef46948a9d963ff604e4a544faa7d0","downloaded_from":"2026-09-10T00:14:32.244Z","last_downloaded_at":"2026-09-10T00:14:32.244Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482698","source_sha256":"9017493a8aa97d88bf0bffe1b392da9e0ab8a2b88c172d42ef680e169416cadc"}},{"block":null,"heading":"Present Value Measurement of the Obligation","paragraphs":[{"citation":"405-30-30-9","para":"30-9","html":"
Current practice in the insurance industry is to allow, but not require (with limited exceptions, such as pensions and postretirement benefits), the discounting of liabilities to reflect the time value of money when the aggregate amount of the obligation and the amount and timing of the cash payments are fixed or reliably determinable for a particular liability.
","snippet":"Current practice in the insurance industry is to allow, but not require (with limited exceptions, such as pensions and postretirement benefits), the discounting of liabilities to reflect the time value of money when the …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:6613dbdfc72e2448a5d89cda8695545eb9ceecbfd16974e295d71e1c5f3689f2","downloaded_from":"2026-09-10T00:14:32.244Z","last_downloaded_at":"2026-09-10T00:14:32.244Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482698","source_sha256":"9017493a8aa97d88bf0bffe1b392da9e0ab8a2b88c172d42ef680e169416cadc"}},{"citation":"405-30-30-10","para":"30-10","html":"
Similarly, for assessments that meet those criteria, the liability may be recorded at its present value by discounting the estimated future cash flows at an appropriate interest rate.
","snippet":"Similarly, for assessments that meet those criteria, the liability may be recorded at its present value by discounting the estimated future cash flows at an appropriate interest rate.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f51f0bdd8fe63073f46da5000bc8df5845fc5390671ca35568e1d07581c1d1d6","downloaded_from":"2026-09-10T00:14:32.244Z","last_downloaded_at":"2026-09-10T00:14:32.244Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482698","source_sha256":"9017493a8aa97d88bf0bffe1b392da9e0ab8a2b88c172d42ef680e169416cadc"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:9c7b2733c7dc83d13964f747ab32b3c79b3f7244be3b9dfbcfbae8070a867876","downloaded_from":"2026-09-10T00:14:32.244Z","last_downloaded_at":"2026-09-10T00:14:32.244Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482698","source_sha256":"9017493a8aa97d88bf0bffe1b392da9e0ab8a2b88c172d42ef680e169416cadc"}},{"block":null,"heading":"Asset for Premium Tax Offsets and Policy Surcharges","paragraphs":[{"citation":"405-30-30-11","para":"30-11","html":"
The asset recognized under paragraph 405-30-25-8 shall be measured based on current laws and projections of future premium collections or policy surcharges from in-force policies. In determining the asset to be recorded, in-force policies do not include expected renewals of short-duration contracts but do include assumptions as to persistency rates for long-duration contracts.
","snippet":"The asset recognized under paragraph 405-30-25-8 shall be measured based on current laws and projections of future premium collections or policy surcharges from in-force policies. In determining the asset to be recorded,…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:108848b8b922df53ba14a09499a267972b33779d4d814b733480e9eaf3569f6d","downloaded_from":"2026-09-10T00:14:32.244Z","last_downloaded_at":"2026-09-10T00:14:32.244Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482698","source_sha256":"9017493a8aa97d88bf0bffe1b392da9e0ab8a2b88c172d42ef680e169416cadc"}},{"citation":"405-30-30-12","para":"30-12","html":"
The time value of money need not be considered in the determination of the recorded amount of a potential recovery if the liability is not discounted. In instances in which the recovery period for an asset is substantially longer than the payout period for the liability, it may be appropriate to record the asset on a discounted basis regardless of whether the liability is discounted.
","snippet":"The time value of money need not be considered in the determination of the recorded amount of a potential recovery if the liability is not discounted. In instances in which the recovery period for an asset is substantial…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:07eb4a854e63e41771cc571643e81af1a36842233c1b113c012d7caf62985c70","downloaded_from":"2026-09-10T00:14:32.244Z","last_downloaded_at":"2026-09-10T00:14:32.244Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482698","source_sha256":"9017493a8aa97d88bf0bffe1b392da9e0ab8a2b88c172d42ef680e169416cadc"}},{"citation":"405-30-30-13","para":"30-13","html":"
The recognition of such assets related to prospective-premium-based assessments is limited to the amount of premium an entity has written or is obligated to write and to the amounts recoverable over the life of the in-force policies. The expected premium tax offset or policy surcharge asset related to the accrual of prospective-premium-based assessments shall be based on and limited to the amount recoverable as a result of premiums the insurer has written or is obligated to write.
","snippet":"The recognition of such assets related to prospective-premium-based assessments is limited to the amount of premium an entity has written or is obligated to write and to the amounts recoverable over the life of the in-fo…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:5c81ecde68e55e7724b244782e37dcba53d967c0f02ef0a7e36834c1f2ddc018","downloaded_from":"2026-09-10T00:14:32.244Z","last_downloaded_at":"2026-09-10T00:14:32.244Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482698","source_sha256":"9017493a8aa97d88bf0bffe1b392da9e0ab8a2b88c172d42ef680e169416cadc"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:c88cb695ef003d0fe9af3a662ff0c1e6ea31537e00965a70e493cfb844149c94","downloaded_from":"2026-09-10T00:14:32.244Z","last_downloaded_at":"2026-09-10T00:14:32.244Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482698","source_sha256":"9017493a8aa97d88bf0bffe1b392da9e0ab8a2b88c172d42ef680e169416cadc"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:4c411d998530b8ac9c69422ed2351a5a7220c488bf0db11fc8500834667d17fa","downloaded_from":"2026-09-10T00:14:32.244Z","last_downloaded_at":"2026-09-10T00:14:32.244Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482698","source_sha256":"9017493a8aa97d88bf0bffe1b392da9e0ab8a2b88c172d42ef680e169416cadc"}},{"number":"35","label":"35 Subsequent Measurement","anchor":"35-subsequent-measurement","is_sec":false,"groups":[{"block":null,"heading":"Asset for Premium Tax Offsets and Policy Surcharges","paragraphs":[{"citation":"405-30-35-1","para":"35-1","html":"
The asset recorded under paragraph 405-30-25-8 for premium tax offsets and policy surcharges shall be subject to a valuation allowance to reflect any portion of the asset that is no longer probable of realization. Considering expected future premiums other than on in-force policies in evaluating the recoverability of premium tax offsets or policy surcharges is not appropriate.
","snippet":"The asset recorded under paragraph 405-30-25-8 for premium tax offsets and policy surcharges shall be subject to a valuation allowance to reflect any portion of the asset that is no longer probable of realization. Consid…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:a60dee53e81cef37d02bbdef0e171dfd8dd8f909a2327c0c54e1ed0010da993e","downloaded_from":"2026-09-10T00:14:35.204Z","last_downloaded_at":"2026-09-10T00:14:35.204Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482672","source_sha256":"51249e2ce55dd36f4ee4fee844fa4cba2dd55156ae878705c843cece70b0a2af"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:0cd67c0faee2e44ea18557aa5a3ea1ae298d61bb9f50d41da77fda8d1167d47d","downloaded_from":"2026-09-10T00:14:35.204Z","last_downloaded_at":"2026-09-10T00:14:35.204Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482672","source_sha256":"51249e2ce55dd36f4ee4fee844fa4cba2dd55156ae878705c843cece70b0a2af"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:19656d9ed34b4ace8d1e45749d2064ebb6dd8a8a5e9a90a003fe822726c1c972","downloaded_from":"2026-09-10T00:14:35.204Z","last_downloaded_at":"2026-09-10T00:14:35.204Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482672","source_sha256":"51249e2ce55dd36f4ee4fee844fa4cba2dd55156ae878705c843cece70b0a2af"}},{"number":"50","label":"50 Disclosure","anchor":"50-disclosure","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-30-50-1","para":"50-1","html":"
Sections 275-10-50 and 450-20-55 address disclosures related to loss contingencies. That guidance is applicable to assessments covered by this Subtopic. Additionally, if amounts have been discounted, the entity shall disclose in the financial statements the undiscounted amounts of the liability and any related asset for premium tax offsets or policy surcharges as well as the discount rate used. If amounts have not been discounted, the entity shall disclose in the financial statements the amounts of the liability, any related asset for premium tax offsets or policy surcharges, the periods over which the assessments are expected to be paid, and the period over which the recorded premium tax offsets or policy surcharges are expected to be realized.
","snippet":"Sections 275-10-50 and 450-20-55 address disclosures related to loss contingencies. That guidance is applicable to assessments covered by this Subtopic. Additionally, if amounts have been discounted, the entity shall dis…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:ac2c409f6b6c1dbf80b8aef7a4dbd6efe932e8db16b81dfd341bf0720378f962","downloaded_from":"2026-09-10T00:14:38.049Z","last_downloaded_at":"2026-09-10T00:14:38.049Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482645","source_sha256":"29710918806cc98826d032022f39d941764ac952761750f980850bb0d2d6668b"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f7290ffc1c7912cea3d6d1fa449e0c8888bef89166cfcfa8bce3f2ef689442cb","downloaded_from":"2026-09-10T00:14:38.049Z","last_downloaded_at":"2026-09-10T00:14:38.049Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482645","source_sha256":"29710918806cc98826d032022f39d941764ac952761750f980850bb0d2d6668b"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:a9c9316aed506364d894d118e816860c3b16a348493221c0a25188efabc312bd","downloaded_from":"2026-09-10T00:14:38.049Z","last_downloaded_at":"2026-09-10T00:14:38.049Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482645","source_sha256":"29710918806cc98826d032022f39d941764ac952761750f980850bb0d2d6668b"}},{"number":"55","label":"55 Implementation Guidance and Illustrations","anchor":"55-implementation-guidance-and-illustrations","is_sec":false,"groups":[{"block":null,"heading":"Illustrations","paragraphs":[{"citation":"405-30-55-1","para":"55-1","html":"
This Example illustrates application of the recognition and measurement guidance in this Subtopic to a prospective-premium-based assessment. This kind of assessment is considered prospective because the assessment relates to premium written after the insolvency. As a result of insolvencies in prior years, ABC Property & Liability Insurance Company (ABC) expects to be assessed in the future by the guaranty fund in a state where it writes premiums. Any such assessments will be limited to 2 percent of premium writings in the prior year and are recoverable through premium tax offsets on a ratable basis over the 5-year period following the year of each assessment.
","snippet":"This Example illustrates application of the recognition and measurement guidance in this Subtopic to a prospective-premium-based assessment. This kind of assessment is considered prospective because the assessment relate…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f1065cbc3bbdb4bdf9fc317740587fe18caa3750ff6d5e3a87584522e5e75094","downloaded_from":"2026-09-10T00:14:40.851Z","last_downloaded_at":"2026-09-10T00:14:40.851Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482619","source_sha256":"0dd69d46134c4590a6b04e2351532092a66188f315fc620135b6e949c90531e0"}},{"citation":"405-30-55-2","para":"55-2","html":"
Although it does not expect to do so, ABC is free to cease writing the lines of business that are subject to the guaranty-fund assessments.
","snippet":"Although it does not expect to do so, ABC is free to cease writing the lines of business that are subject to the guaranty-fund assessments.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:b8ea4f5365ab7c12b11ce1e234f59d8051d2cf4aa38d9ed6aa7245804a1f8343","downloaded_from":"2026-09-10T00:14:40.851Z","last_downloaded_at":"2026-09-10T00:14:40.851Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482619","source_sha256":"0dd69d46134c4590a6b04e2351532092a66188f315fc620135b6e949c90531e0"}},{"citation":"405-30-55-3","para":"55-3","html":"
As of December 31, 19X0, ABC has neither paid nor received a notice of an assessment related to the insolvencies. Based on communications from the state guaranty association, ABC expects to receive an assessment in 19X1, which is allocated among entities based on 19X0 market share, for at least 1 percent of 19X0 premiums that are subject to the assessment. A best estimate cannot be determined, and no amount within the range of estimates (meaning, from 1 to 2 percent of 19X0 premiums) is a better estimate than any other amount, therefore the minimum amount in the range shall be accrued.
","snippet":"As of December 31, 19X0, ABC has neither paid nor received a notice of an assessment related to the insolvencies. Based on communications from the state guaranty association, ABC expects to receive an assessment in 19X1,…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:a4f7799704535e13c9e3c8e05f8bbcd355acbb5b9261b6444d0a3ff9b9bd407d","downloaded_from":"2026-09-10T00:14:40.851Z","last_downloaded_at":"2026-09-10T00:14:40.851Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482619","source_sha256":"0dd69d46134c4590a6b04e2351532092a66188f315fc620135b6e949c90531e0"}},{"citation":"405-30-55-4","para":"55-4","html":"
As of December 31, 19X0, ABC should recognize a liability equal to 1 percent of the premiums written in 19X0 that are subject to the assessment. No additional liability should be recognized, and no asset related to the premium tax offset should be recognized. Disclosure of the loss contingency of up to an additional 1 percent of the subject premiums should be considered.
","snippet":"As of December 31, 19X0, ABC should recognize a liability equal to 1 percent of the premiums written in 19X0 that are subject to the assessment. No additional liability should be recognized, and no asset related to the p…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:6bf0ba30de2bd3cd2bec74ed2cc3adcabbfee87e216ab9e0cc582891454d1db0","downloaded_from":"2026-09-10T00:14:40.851Z","last_downloaded_at":"2026-09-10T00:14:40.851Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482619","source_sha256":"0dd69d46134c4590a6b04e2351532092a66188f315fc620135b6e949c90531e0"}},{"citation":"405-30-55-5","para":"55-5","html":"
ABC would recognize a liability only for those future assessments it is obligated to pay as a result of the premiums written. Because ABC is not obligated to write any future premiums, its liability is limited to that related to premiums written in 19X0. Because no amount within the range of estimates is a better estimate than any other amount, the minimum amount in the range is accrued. Further, because the premium tax offset is realizable only on business that will be written in the future (that is, 19X2 and subsequent years), no asset or receivable is recognized as of December 31, 19X0.
","snippet":"ABC would recognize a liability only for those future assessments it is obligated to pay as a result of the premiums written. Because ABC is not obligated to write any future premiums, its liability is limited to that re…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:5ae79943577373e60c5af65944c6a82060311712f306ebdd5a3026481fd4a2af","downloaded_from":"2026-09-10T00:14:40.851Z","last_downloaded_at":"2026-09-10T00:14:40.851Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482619","source_sha256":"0dd69d46134c4590a6b04e2351532092a66188f315fc620135b6e949c90531e0"}},{"citation":"405-30-55-6","para":"55-6","html":"
This Example illustrates application of the recognition and measurement guidance in this Subtopic to a retrospective-premium-based assessment. As a result of an insolvency that occurred during 19X0, DEF Life and Health Insurance Company (DEF) expects to be assessed in the future by the guaranty fund in a state where it has written business. Any such assessment will be based on DEF's average market share, determined based on premiums that are subject to the assessment for the three years before the insolvency, and limited to 2 percent of the average annual subject premiums for the three years before the insolvency. Further, such assessments are recoverable through premium tax offsets over the five-year period following the year of payment for each assessment.
","snippet":"This Example illustrates application of the recognition and measurement guidance in this Subtopic to a retrospective-premium-based assessment. As a result of an insolvency that occurred during 19X0, DEF Life and Health I…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:05b5b2106eeed3be8810501ff509542959a694e6c4cddcf4193e55d036e5eff8","downloaded_from":"2026-09-10T00:14:40.851Z","last_downloaded_at":"2026-09-10T00:14:40.851Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482619","source_sha256":"0dd69d46134c4590a6b04e2351532092a66188f315fc620135b6e949c90531e0"}},{"citation":"405-30-55-7","para":"55-7","html":"
As of December 31, 19X0, DEF has not paid or received a notice of an assessment related to the insolvency. Based on initial input from the National Organization of Life and Health Insurance Guaranty Associations and experience with other insolvencies, DEF assumes that the first assessment will not be made until 19X3 and that it will take three to five annual assessments for the guaranty fund to be able to meet its obligations. Based on the estimated nationwide cost of the insolvency and the distribution of the insolvent entity's business, DEF estimates that its assessment will be at least 1 percent of the average annual premiums that are subject to the assessment. No amount within the range of estimates (meaning, from 1 to 2 percent of the average annual premiums for 3 to 5 years) is a better estimate than any other amount, therefore the minimum amount in the range shall be accrued.
","snippet":"As of December 31, 19X0, DEF has not paid or received a notice of an assessment related to the insolvency. Based on initial input from the National Organization of Life and Health Insurance Guaranty Associations and expe…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:7a62c80adc3436aa8c44cdb392193fafeeeb2fe0394220c4b7ab51113232c258","downloaded_from":"2026-09-10T00:14:40.851Z","last_downloaded_at":"2026-09-10T00:14:40.851Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482619","source_sha256":"0dd69d46134c4590a6b04e2351532092a66188f315fc620135b6e949c90531e0"}},{"citation":"405-30-55-8","para":"55-8","html":"
As of December 31, 19X0, DEF should recognize a liability for 3 years of assessments at 1 percent of the average annual premiums that are subject to the assessment (that is, the assessments expected in 19X3, 19X4, and 19X5). Disclosure of the loss contingency for additional assessments (meaning, in 19X6 and 19X7) or assessment of greater than 1 percent of the average annual premiums that are subject to the assessment should be considered. An asset related to premium tax offsets that are available on accrued assessments would be recorded provided there were sufficient premium taxes based on business in force at December 31, 19X0 (with assumed levels of policy retention), to allow realization of the asset.
","snippet":"As of December 31, 19X0, DEF should recognize a liability for 3 years of assessments at 1 percent of the average annual premiums that are subject to the assessment (that is, the assessments expected in 19X3, 19X4, and 19…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:d7f0735eb7db43963c26dfcd360471988bfba89bf1d8cbbe1cd291eaf55efeaf","downloaded_from":"2026-09-10T00:14:40.851Z","last_downloaded_at":"2026-09-10T00:14:40.851Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482619","source_sha256":"0dd69d46134c4590a6b04e2351532092a66188f315fc620135b6e949c90531e0"}},{"citation":"405-30-55-9","para":"55-9","html":"
The resulting recognized liability and asset are as follows (shown on both a discounted and undiscounted basis, based on paragraphs
405-30-30-9 through 30-12
, discounting is optional), assuming average annual subject premiums of $100,000 for the 3 years before the insolvency.
","snippet":"The resulting recognized liability and asset are as follows (shown on both a discounted and undiscounted basis, based on paragraphs 405-30-30-9 through 30-12, discounting is optional), assuming average annual subject pre…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:9cc4c9a68a2044e5e01888bdf64b627eb428f895aa920907d3b5034f84cce5d4","downloaded_from":"2026-09-10T00:14:40.851Z","last_downloaded_at":"2026-09-10T00:14:40.851Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482619","source_sha256":"0dd69d46134c4590a6b04e2351532092a66188f315fc620135b6e949c90531e0"}},{"citation":"405-30-55-10","para":"55-10","html":"
DEF would record a liability for all future assessments related to the insolvency. Because no amount within the range of estimates (meaning, from 1 to 2 percent of the average annual premiums for 3 to 5 years) is a better estimate than any other amount, the minimum amount in the range (meaning, 1 percent per year for 3 years of assessments) is accrued.
","snippet":"DEF would record a liability for all future assessments related to the insolvency. Because no amount within the range of estimates (meaning, from 1 to 2 percent of the average annual premiums for 3 to 5 years) is a bette…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f098ab1a49b36e788a7102988b470be6bcc4567bd7bbf09f49bacaf5d926f380","downloaded_from":"2026-09-10T00:14:40.851Z","last_downloaded_at":"2026-09-10T00:14:40.851Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482619","source_sha256":"0dd69d46134c4590a6b04e2351532092a66188f315fc620135b6e949c90531e0"}},{"citation":"405-30-55-11","para":"55-11","html":"
Since it is assumed that based on the anticipated levels of policy retention from the business in force at December 31, 19X0, there will be sufficient premium to realize the premium tax offset, the premium tax offset is recorded.
","snippet":"Since it is assumed that based on the anticipated levels of policy retention from the business in force at December 31, 19X0, there will be sufficient premium to realize the premium tax offset, the premium tax offset is …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:27025bd1482058c2aa329a1bbd7e5e24864e52a4516df14f0dd708e0b41fc880","downloaded_from":"2026-09-10T00:14:40.851Z","last_downloaded_at":"2026-09-10T00:14:40.851Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482619","source_sha256":"0dd69d46134c4590a6b04e2351532092a66188f315fc620135b6e949c90531e0"}},{"citation":"405-30-55-12","para":"55-12","html":"
This Example illustrates application of the recognition and measurement guidance in this Subtopic to a loss-based assessment. GHI Industrial Company (GHI) is self-insured for workers' compensation and therefore participates in the second injury fund in the state where it conducts operations. GHI is entitled to recover from the fund some or all of the indemnity claims for previously injured workers. GHI is also subject to annual assessments (maximum of 1 percent per year) on indemnity claims paid each year.
","snippet":"This Example illustrates application of the recognition and measurement guidance in this Subtopic to a loss-based assessment. GHI Industrial Company (GHI) is self-insured for workers' compensation and therefore participa…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:5d78bbe52798ebdf8c2408b955489947fc5cbde45abee16ac3820f1b59a77ff7","downloaded_from":"2026-09-10T00:14:40.851Z","last_downloaded_at":"2026-09-10T00:14:40.851Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482619","source_sha256":"0dd69d46134c4590a6b04e2351532092a66188f315fc620135b6e949c90531e0"}},{"citation":"405-30-55-13","para":"55-13","html":"
Assessment rates have been climbing steadily, from 0.6 percent 5 years previous to 0.75 percent in 19X0.
","snippet":"Assessment rates have been climbing steadily, from 0.6 percent 5 years previous to 0.75 percent in 19X0.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:51c87ac9020645eb109e2b78ca4a1457214b92bf3f729e625d84aed702702233","downloaded_from":"2026-09-10T00:14:40.851Z","last_downloaded_at":"2026-09-10T00:14:40.851Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482619","source_sha256":"0dd69d46134c4590a6b04e2351532092a66188f315fc620135b6e949c90531e0"}},{"citation":"405-30-55-14","para":"55-14","html":"
As of December 31, 19X0, GHI should have an assessment liability recognized for 0.75 percent of its liability for the payment of future indemnity claims, unless there was information to support the assessment rate being reduced or the assessments being eliminated in the future. Disclosure of the loss contingency of up to an additional 0.25 percent of the liability for the payment of future indemnity claims should be considered.
","snippet":"As of December 31, 19X0, GHI should have an assessment liability recognized for 0.75 percent of its liability for the payment of future indemnity claims, unless there was information to support the assessment rate being …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:fd4eee4df5abf4809d551dfebde8be2ab6a3a9237e374c95e342e2c1975f514b","downloaded_from":"2026-09-10T00:14:40.851Z","last_downloaded_at":"2026-09-10T00:14:40.851Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482619","source_sha256":"0dd69d46134c4590a6b04e2351532092a66188f315fc620135b6e949c90531e0"}},{"citation":"405-30-55-15","para":"55-15","html":"
GHI would recognize a liability based on the current assessment rate, unless there was clear evidence that the rate would change. The liability would be based on the entire liability base that was subject to the assessment.
","snippet":"GHI would recognize a liability based on the current assessment rate, unless there was clear evidence that the rate would change. The liability would be based on the entire liability base that was subject to the assessme…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:c670f6e8a655df39dd75de6d111bfa86021117361147fc837d43eea36433e6e2","downloaded_from":"2026-09-10T00:14:40.851Z","last_downloaded_at":"2026-09-10T00:14:40.851Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482619","source_sha256":"0dd69d46134c4590a6b04e2351532092a66188f315fc620135b6e949c90531e0"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:9e7a6dc2b0262398327328b079ceb830e0444679ba69f12008ce425382136809","downloaded_from":"2026-09-10T00:14:40.851Z","last_downloaded_at":"2026-09-10T00:14:40.851Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482619","source_sha256":"0dd69d46134c4590a6b04e2351532092a66188f315fc620135b6e949c90531e0"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:d562420c8e6ae520c715ff380f46b6acd6edb724b86ffc842d0398697bf66ece","downloaded_from":"2026-09-10T00:14:40.851Z","last_downloaded_at":"2026-09-10T00:14:40.851Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482619","source_sha256":"0dd69d46134c4590a6b04e2351532092a66188f315fc620135b6e949c90531e0"}}],"enrichment":{"summary":"ASC 405-30 governs when and how entities—insurers and self-insurers alike—accrue liabilities for statutory or regulatory insurance-related assessments such as state guaranty-fund assessments, insurance department administrative assessments, and workers' compensation second-injury fund assessments. A liability is recognized only when an assessment is probable, the obligating event has occurred by the balance sheet date, and the amount is reasonably estimable (405-30-25-1); the obligating event differs by assessment mechanism (retrospective vs. prospective vs. prefunded premium-based, and loss-based). Related recoveries via premium tax offsets or policy surcharges are recognized as assets when probable (405-30-25-8), but recoveries expected only through future premium rate structures are not (405-30-25-10).","key_points":["A liability is accrued only when all three conditions are met: probability of assessment, occurrence of the obligating event on or before the financial statement date, and ability to reasonably estimate the amount (405-30-25-1).","Premium-based guaranty-fund assessments (other than prefunded) are presumed probable upon a formal determination of insolvency and presumed not probable before it; prefunded and premium-based administrative assessments are probable when the underlying premiums are written, and loss-based assessments when the losses are incurred (405-30-25-2 through 25-3).","The obligating event for premium-based assessments is generally writing (or becoming obligated to write or renew) the premiums, but is the insolvency itself where state law or regulatory practice means the entity cannot avoid the assessment by ceasing to write premiums; for loss-based assessments it is incurring the losses (405-30-25-4).","For retrospective-premium-based assessments the entire estimated future assessment for an insolvency is accrued upon formal determination of insolvency, because the obligating premium has already been written (405-30-25-6(a)); prospective-premium-based assessments are accrued as premiums are written unless unavoidable (405-30-25-6(b)).","If the estimate is a range with no better estimate within it, the minimum amount is accrued; if a best estimate exists, that amount is recorded (405-30-25-5; 405-30-30-8).","An asset for premium tax offsets or policy surcharges is recognized when probable, measured on current laws and in-force policies (excluding expected renewals of short-duration contracts but reflecting persistency for long-duration contracts), subject to a valuation allowance; no asset is recorded for recovery through future premium rate structures (405-30-25-8 through 25-10; 405-30-30-11; 405-30-35-1).","Discounting of the liability (and asset) is optional where the amount and timing of cash flows are fixed or reliably determinable; disclosure of discounted vs. undiscounted amounts, discount rate, and expected payment/realization periods is required (405-30-30-9 through 30-12; 405-30-50-1)."],"categories":["Recognition","Subsequent measurement","Contingencies and guarantees","Industry-specific"],"audience_level":"intermediate","student_note":"The exam trap is conflating the event that makes an assessment probable (usually the insolvency) with the event that obligates the entity (usually writing the premium)—for prospective-premium-based assessments an insurer that can stop writing business accrues only for premiums already written, whereas a retrospective assessment is accrued in full at insolvency. Also remember the recovery asymmetry: premium tax offsets and policy surcharges can be assets, but expected recovery through future premium rate structures cannot.","related_topics":["450-20","944","720-50","275-10","855-10","405-20"],"key_concepts":["guaranty-fund assessment","obligating event","formal determination of insolvency","retrospective-premium-based assessment","prospective-premium-based assessment","loss-based assessment","premium tax offset","second-injury fund"],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:1ffd4a4304ceeb09f2500b14ee4b210b1c92b137f576ab8fedd8fac8a05cee0a","downloaded_from":"2026-09-10T00:14:14.713Z","last_downloaded_at":"2026-09-10T00:14:44.711Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},"related":[{"number":"944-40","title":"Claim Costs and Liabilities for Future Policy Benefits","topic_title":"Financial Services—Insurance","score":0.7896,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f80a72b1e8debc4dbab32b8c708a464b3f967044e5973d1e5099c3d7028c5245","downloaded_from":"2026-09-10T02:16:26.116Z","last_downloaded_at":"2026-09-10T02:17:13.308Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"605-944","title":"Financial Services—Insurance","topic_title":"Revenue Recognition","score":0.7622,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:a4e0573398c11189be489606fa68e1367cd9b3b706ebfb8baba64f16eda4bde5","downloaded_from":"2026-09-10T00:49:17.918Z","last_downloaded_at":"2026-09-10T00:49:46.481Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"720-20","title":"Insurance Costs","topic_title":"Other Expenses","score":0.7489,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:22cc9d9435d664669953d03a9834d2d4a16e8c4079d7173fcd750824d3c70693","downloaded_from":"2026-09-10T01:07:18.243Z","last_downloaded_at":"2026-09-10T01:07:45.379Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"450-20","title":"Loss Contingencies","topic_title":"Contingencies","score":0.7382,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:217b6fc9ee893d17ad371c04435f2842982ae258a647ff62028c07b8126dbe09","downloaded_from":"2026-09-10T00:27:01.778Z","last_downloaded_at":"2026-09-10T00:27:44.704Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"805-944","title":"Financial Services—Insurance","topic_title":"Business Combinations","score":0.7295,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f60eee6ef6480fda6fa3646b4f06c3691466bc031e7dc278232ceb4a0ca2cf5a","downloaded_from":"2026-09-10T01:26:39.788Z","last_downloaded_at":"2026-09-10T01:27:09.747Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"944-60","title":"Premium Deficiency and Loss Recognition","topic_title":"Financial Services—Insurance","score":0.7274,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8b58f562076bac13728b8c48565dbb5ab783a7654007df698df97909a6dacc80","downloaded_from":"2026-09-10T02:17:42.336Z","last_downloaded_at":"2026-09-10T02:18:05.734Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}}],"prev":{"number":"405-20","title":"Extinguishments of Liabilities","topic_title":"Liabilities","provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:907d978a72abee3a6d43097109dacc428a0be263ae71abcd5d9ef49f1d7fb251","downloaded_from":"2026-09-10T00:13:46.142Z","last_downloaded_at":"2026-09-10T00:14:11.157Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},"next":{"number":"405-40","title":"Obligations Resulting from Joint and Several Liability Arrangements","topic_title":"Liabilities","provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:0db06949290c945450169572d6c05eacaaf9809abce35003e5b9487f69b793fb","downloaded_from":"2026-09-10T00:14:46.909Z","last_downloaded_at":"2026-09-10T00:15:14.537Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:ba259c1644f033f5eb4b0ced62929390aee1e93231e19f8023ced225eda49eb1","downloaded_from":"2026-09-10T00:14:14.713Z","last_downloaded_at":"2026-09-10T00:14:44.711Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"405-40","topic":"405","title":"Obligations Resulting from Joint and Several Liability Arrangements","area":"Liabilities","paragraphs":12,"summary":"ASC 405-40 governs how an entity recognizes, measures, and discloses obligations arising from joint and several liability arrangements when the total amount of the obligation is fixed at the reporting date (e.g., debt with co-obligors, settled litigation shared with other defendants). The core measurement rule is that the reporting entity records the amount it agreed to pay under its arrangement with co-obligors plus any additional amount it expects to pay on behalf of those co-obligors. Scope excludes obligations already covered by Topics 410, 450, 460, 715, and 740.","concepts":["joint and several liability","co-obligors","fixed total obligation","measurement uncertainty","expected additional amount","recourse provisions","corresponding entry","range of estimates"],"categories":["Recognition","Initial measurement","Subsequent measurement","Disclosure"],"level":"intermediate","topic_title":"Liabilities","sections":[{"number":"00","label":"00 Status","anchor":"00-status","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-40-00-1","para":"00-1","html":"
The following table identifies the changes made to this Subtopic.
Paragraph Action Accounting Standards Update Date
Conduit Debt Security Added Maintenance Update 2014-20 (PDF) 09/29/2014
Nonpublic Entity (Def. 1) Amended Maintenance Update 2014-20 (PDF) 09/29/2014
Nonpublic Entity Added Accounting Standards Update No. 2013-04 02/28/2013
405-40-05-1 Added Accounting Standards Update No. 2013-04 02/28/2013
405-40-15-1 Added Accounting Standards Update No. 2013-04 02/28/2013
405-40-15-2 Added Accounting Standards Update No. 2016-19 12/14/2016
405-40-25-1 Added Accounting Standards Update No. 2013-04 02/28/2013
405-40-25-2 Added Accounting Standards Update No. 2013-04 02/28/2013
405-40-30-1 Added Accounting Standards Update No. 2013-04 02/28/2013
405-40-30-2 Added Accounting Standards Update No. 2013-04 02/28/2013
405-40-35-1 Added Accounting Standards Update No. 2013-04 02/28/2013
405-40-50-1 Added Accounting Standards Update No. 2013-04 02/28/2013
405-40-50-2 Added Accounting Standards Update No. 2013-04 02/28/2013
405-40-65-1 Added Accounting Standards Update No. 2013-04 02/28/2013
","snippet":"The following table identifies the changes made to this Subtopic.\nParagraph | Action | Accounting Standards Update | Date |\n| | | |\nConduit Debt Security | Added | Maintenance Update 2014-20 | 09/29/2014 |\nNonpublic Enti…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:e7142e80d5732a46b7b150e992160e2df69e4023239831c81ff14766f43727b7","downloaded_from":"2026-09-10T00:14:46.909Z","last_downloaded_at":"2026-09-10T00:14:46.909Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479481","source_sha256":"6b190d67809d106761c3c260baba5e43379ade30f4c697c50eba5349d28f08a8"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:9471b655b8521878cefcfeca8a400ce06194168a2661f072753500ba9671ad50","downloaded_from":"2026-09-10T00:14:46.909Z","last_downloaded_at":"2026-09-10T00:14:46.909Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479481","source_sha256":"6b190d67809d106761c3c260baba5e43379ade30f4c697c50eba5349d28f08a8"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:e29df78b7620bca80d91132c93ae4bfe5f1e02e8e9adea4a500be3b0ac3cdc5e","downloaded_from":"2026-09-10T00:14:46.909Z","last_downloaded_at":"2026-09-10T00:14:46.909Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479481","source_sha256":"6b190d67809d106761c3c260baba5e43379ade30f4c697c50eba5349d28f08a8"}},{"number":"05","label":"05 Overview and Background","anchor":"05-overview-and-background","is_sec":false,"groups":[{"block":null,"heading":"Overall Guidance","paragraphs":[{"citation":"405-40-05-1","para":"05-1","html":"
This Subtopic addresses the recognition, measurement, and disclosure of obligations resulting from joint and several liability arrangements.
","snippet":"This Subtopic addresses the recognition, measurement, and disclosure of obligations resulting from joint and several liability arrangements.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:95303ce2a7edbae960e427ec33ee13fbde3cb28c2b1ea1c96bdb6a4f06d12cda","downloaded_from":"2026-09-10T00:14:50.279Z","last_downloaded_at":"2026-09-10T00:14:50.279Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479450","source_sha256":"d3aed69420d9bd9b5ea30356ce062171e049f02155d90f6267ebe5a7cb8bef7d"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:1acff1ea4c4aa99d72a9a424b04e59beead63f26cb8cd95bf86b9d220f25c6f8","downloaded_from":"2026-09-10T00:14:50.279Z","last_downloaded_at":"2026-09-10T00:14:50.279Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479450","source_sha256":"d3aed69420d9bd9b5ea30356ce062171e049f02155d90f6267ebe5a7cb8bef7d"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:e55cb078c4f64c0098a55664c93a6691ade6e005e99179fd7c74951e49169d85","downloaded_from":"2026-09-10T00:14:50.279Z","last_downloaded_at":"2026-09-10T00:14:50.279Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479450","source_sha256":"d3aed69420d9bd9b5ea30356ce062171e049f02155d90f6267ebe5a7cb8bef7d"}},{"number":"15","label":"15 Scope and Scope Exceptions","anchor":"15-scope-and-scope-exceptions","is_sec":false,"groups":[{"block":null,"heading":"Overall Guidance","paragraphs":[{"citation":"405-40-15-1","para":"15-1","html":"
The guidance in this Subtopic applies to obligations resulting from joint and several liability arrangements for which the total amount under the arrangement is fixed at the reporting date, except for obligations otherwise accounted for under the following Topics:
  1. a
    Asset Retirement and Environmental Obligations, see Topic 410
  2. b
    Contingencies, see Topic 450
  3. c
    Guarantees, see Topic 460
  4. d
    Compensation—Retirement Benefits, see Topic 715
  5. e
    Income Taxes, see Topic 740.
For the total amount of an obligation under an arrangement to be considered fixed at the reporting date there can be no measurement uncertainty at the reporting date relating to the total amount of the obligation within the scope of this Subtopic. However, the total amount of the obligation may change subsequently because of factors that are unrelated to measurement uncertainty. For example, the amount may be fixed at the reporting date but change in future periods because an additional amount was borrowed under a line of credit for which an entity is jointly and severally liable or because the interest rate on a joint and several liability arrangement changed.
","snippet":"The guidance in this Subtopic applies to obligations resulting from joint and several liability arrangements for which the total amount under the arrangement is fixed at the reporting date, except for obligations otherwi…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:0cd5fe5459139d6efcd999d73950137d04ac239cdc174514db099f91d35ecb76","downloaded_from":"2026-09-10T00:14:53.557Z","last_downloaded_at":"2026-09-10T00:14:53.557Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477126","source_sha256":"41a8ce727bd041bb08176257779069b704b6357f0566280591f7f55d795cd4f7"}},{"citation":"405-40-15-2","para":"15-2","html":"
Although the total amount of the obligation of the entity and its co-obligors must be fixed at the reporting date to be within the scope of this Subtopic, the amount that the entity expects to pay on behalf of its co-obligors may be uncertain at the reporting date.
","snippet":"Although the total amount of the obligation of the entity and its co-obligors must be fixed at the reporting date to be within the scope of this Subtopic, the amount that the entity expects to pay on behalf of its co-obl…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:a6a2b4252569f7864a4be77675fc5610b7323fd4ea717c38baa7a4c37332d11a","downloaded_from":"2026-09-10T00:14:53.557Z","last_downloaded_at":"2026-09-10T00:14:53.557Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477126","source_sha256":"41a8ce727bd041bb08176257779069b704b6357f0566280591f7f55d795cd4f7"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:619762c99394e4bea71a353874f73f69351770695cad48358e0d2b0b14cbf1fa","downloaded_from":"2026-09-10T00:14:53.557Z","last_downloaded_at":"2026-09-10T00:14:53.557Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477126","source_sha256":"41a8ce727bd041bb08176257779069b704b6357f0566280591f7f55d795cd4f7"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:143f8d838c85fd9eb53c67d1e272142dca4be0495b4e97b027e31605f15e52bc","downloaded_from":"2026-09-10T00:14:53.557Z","last_downloaded_at":"2026-09-10T00:14:53.557Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477126","source_sha256":"41a8ce727bd041bb08176257779069b704b6357f0566280591f7f55d795cd4f7"}},{"number":"25","label":"25 Recognition","anchor":"25-recognition","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-40-25-1","para":"25-1","html":"
An entity shall recognize obligations resulting from joint and several liability arrangements when the arrangement is included in the scope of this Subtopic. In some circumstances, the arrangement is included in the scope of this Subtopic at the inception of the arrangement (for example, a debt arrangement); in other circumstances, the arrangement is included in the scope of this Subtopic after the inception of the arrangement (for example, when the total amount of the obligation becomes fixed, consistent with paragraph 405-40-15-1).
","snippet":"An entity shall recognize obligations resulting from joint and several liability arrangements when the arrangement is included in the scope of this Subtopic. In some circumstances, the arrangement is included in the scop…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:973760e90aecca74dec623ba11e2e62c8633777a9347242f3a27afb35c1ca602","downloaded_from":"2026-09-10T00:14:59.218Z","last_downloaded_at":"2026-09-10T00:14:59.218Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477116","source_sha256":"abe2bb3ce87c8599fe81197091d14860a4e02bdcabdda16a8c26ab5bf49a5ef9"}},{"citation":"405-40-25-2","para":"25-2","html":"
The corresponding entry or entries shall depend on facts and circumstances of the obligation. Examples of corresponding entries include the following:
  1. a
    Cash for proceeds from a debt arrangement
  2. b
    An expense for a legal settlement
  3. c
    A receivable (that is assessed for impairment) for a contractual right
  4. d
    An equity transaction with an entity under common control.
","snippet":"The corresponding entry or entries shall depend on facts and circumstances of the obligation. Examples of corresponding entries include the following:\n(a) Cash for proceeds from a debt arrangement\n(b) An expense for a le…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:43837b7d03e3358d1246cfdfabb0c651f67986c939f77180c76d044061362606","downloaded_from":"2026-09-10T00:14:59.218Z","last_downloaded_at":"2026-09-10T00:14:59.218Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477116","source_sha256":"abe2bb3ce87c8599fe81197091d14860a4e02bdcabdda16a8c26ab5bf49a5ef9"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:0febd8fc64ae5bdf351a279f8f81ba579bf97f6fcb1062e22c681403266c7a1c","downloaded_from":"2026-09-10T00:14:59.218Z","last_downloaded_at":"2026-09-10T00:14:59.218Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477116","source_sha256":"abe2bb3ce87c8599fe81197091d14860a4e02bdcabdda16a8c26ab5bf49a5ef9"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:ecb72b5a25001777c2fbd507bbd11690fe756feb0d1683f6bd0526cacf52c326","downloaded_from":"2026-09-10T00:14:59.218Z","last_downloaded_at":"2026-09-10T00:14:59.218Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477116","source_sha256":"abe2bb3ce87c8599fe81197091d14860a4e02bdcabdda16a8c26ab5bf49a5ef9"}},{"number":"30","label":"30 Initial Measurement","anchor":"30-initial-measurement","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-40-30-1","para":"30-1","html":"
Obligations resulting from joint and several liability arrangements included in the scope of this Subtopic initially shall be measured as the sum of the following:
  1. a
    The amount the reporting entity agreed to pay on the basis of its arrangement among its co-obligors.
  2. b
    Any additional amount the reporting entity expects to pay on behalf of its co-obligors. If some amount within a range of the additional amount the reporting entity expects to pay is a better estimate than any other amount within the range, that amount shall be the additional amount included in the measurement of the obligation. If no amount within the range is a better estimate than any other amount, then the minimum amount in the range shall be the additional amount included in the measurement of the obligation.
","snippet":"Obligations resulting from joint and several liability arrangements included in the scope of this Subtopic initially shall be measured as the sum of the following:\n(a) The amount the reporting entity agreed to pay on the…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:cae52a089f7b2fb69a313b27eaff0d3227460c70c09366e836ab27916c1d51bd","downloaded_from":"2026-09-10T00:15:01.041Z","last_downloaded_at":"2026-09-10T00:15:01.041Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477109","source_sha256":"7c9813f585e95b8d0585ea41323a816c099b8fe6afecbf8f4d39575b1900113d"}},{"citation":"405-40-30-2","para":"30-2","html":"
The corresponding entry or entries shall depend on the facts and circumstances of the obligation.
","snippet":"The corresponding entry or entries shall depend on the facts and circumstances of the obligation.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:9c965fed66541ae54351b87b8fdca10870f879e8f28d9b268b03b24368c9c018","downloaded_from":"2026-09-10T00:15:01.041Z","last_downloaded_at":"2026-09-10T00:15:01.041Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477109","source_sha256":"7c9813f585e95b8d0585ea41323a816c099b8fe6afecbf8f4d39575b1900113d"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:7d5053eb03b3e2c8fe924ba87b27b95dac2bf465b913844627fb1430794b0288","downloaded_from":"2026-09-10T00:15:01.041Z","last_downloaded_at":"2026-09-10T00:15:01.041Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477109","source_sha256":"7c9813f585e95b8d0585ea41323a816c099b8fe6afecbf8f4d39575b1900113d"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:81eaaedd0b6deb6119cb3805207302a8799d0734d516ea38a724ffe5e7166912","downloaded_from":"2026-09-10T00:15:01.041Z","last_downloaded_at":"2026-09-10T00:15:01.041Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477109","source_sha256":"7c9813f585e95b8d0585ea41323a816c099b8fe6afecbf8f4d39575b1900113d"}},{"number":"35","label":"35 Subsequent Measurement","anchor":"35-subsequent-measurement","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-40-35-1","para":"35-1","html":"
Obligations resulting from joint and several liability arrangements included in the scope of this Subtopic subsequently shall be measured using the guidance in Section 405-40-30.
","snippet":"Obligations resulting from joint and several liability arrangements included in the scope of this Subtopic subsequently shall be measured using the guidance in Section 405-40-30.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:18ad428b952efa373d8231e5fe85a04f7b1574773d18c2d50c72314a7c249eed","downloaded_from":"2026-09-10T00:15:05.063Z","last_downloaded_at":"2026-09-10T00:15:05.063Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477101","source_sha256":"9d7c3d88971ce1f6ef08aa044f2fb37b2b6806e48f375ad5c260d122ad36f6c9"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:6e723eba2ebc40df0b89a935ad125736ba7b8c58f758f36062fc9e9f40569da1","downloaded_from":"2026-09-10T00:15:05.063Z","last_downloaded_at":"2026-09-10T00:15:05.063Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477101","source_sha256":"9d7c3d88971ce1f6ef08aa044f2fb37b2b6806e48f375ad5c260d122ad36f6c9"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:52d3f5afb57f3073b134d0f2a63f684f768958f5aff65388bc43fe08da3711b3","downloaded_from":"2026-09-10T00:15:05.063Z","last_downloaded_at":"2026-09-10T00:15:05.063Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477101","source_sha256":"9d7c3d88971ce1f6ef08aa044f2fb37b2b6806e48f375ad5c260d122ad36f6c9"}},{"number":"50","label":"50 Disclosure","anchor":"50-disclosure","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-40-50-1","para":"50-1","html":"
An entity shall disclose the following information about each obligation, or each group of similar obligations, resulting from joint and several liability arrangements included in the scope of this Subtopic:
  1. a
    The nature of the arrangement, including:
    1. 1
      How the liability arose
    2. 2
      The relationship with other co-obligors
    3. 3
      The terms and conditions of the arrangement.
  2. b
    The total outstanding amount under the arrangement, which shall not be reduced by the effect of any amounts that may be recoverable from other entities
  3. c
    The carrying amount, if any, of an entity's liability and the carrying amount of a receivable recognized, if any
  4. d
    The nature of any recourse provisions that would enable recovery from other entities of the amounts paid, including any limitations on the amounts that might be recovered
  5. e
    In the period the liability is initially recognized and measured or in a period the measurement changes significantly:
    1. 1
      The corresponding entry
    2. 2
      Where the entry was recorded in the financial statements.
","snippet":"An entity shall disclose the following information about each obligation, or each group of similar obligations, resulting from joint and several liability arrangements included in the scope of this Subtopic:\n(a) The natu…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:d870a44c7c86c7fe185448d46c678b439788e8060a7c36f1e8a5fe661b00fb2a","downloaded_from":"2026-09-10T00:15:09.160Z","last_downloaded_at":"2026-09-10T00:15:09.160Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477092","source_sha256":"07e332100b6bab194e601cf510b1fcebe4f18d2f24d0c0b095ae3c4398bed8fb"}},{"citation":"405-40-50-2","para":"50-2","html":"
The disclosures required by this Section do not affect the related-party disclosure requirements in Topic 850. The disclosure requirements in this Section are incremental to those requirements.
","snippet":"The disclosures required by this Section do not affect the related-party disclosure requirements in Topic 850. The disclosure requirements in this Section are incremental to those requirements.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:cb130c6039680222634e3893a4c4df7df5fd42f05bd69b7caa07d90c03303f3e","downloaded_from":"2026-09-10T00:15:09.160Z","last_downloaded_at":"2026-09-10T00:15:09.160Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477092","source_sha256":"07e332100b6bab194e601cf510b1fcebe4f18d2f24d0c0b095ae3c4398bed8fb"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:36aaabd497e26fc03c963805748c312d976f82345b20c6a533eb935aca3c1209","downloaded_from":"2026-09-10T00:15:09.160Z","last_downloaded_at":"2026-09-10T00:15:09.160Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477092","source_sha256":"07e332100b6bab194e601cf510b1fcebe4f18d2f24d0c0b095ae3c4398bed8fb"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:65abfe92278c79200cd16fd66a47b221cc51684ed3ae231eef41eaf6d65ae8bf","downloaded_from":"2026-09-10T00:15:09.160Z","last_downloaded_at":"2026-09-10T00:15:09.160Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477092","source_sha256":"07e332100b6bab194e601cf510b1fcebe4f18d2f24d0c0b095ae3c4398bed8fb"}},{"number":"65","label":"65 Transition and Open Effective Date Information","anchor":"65-transition-and-open-effective-date-information","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-40-65-1","para":"65-1","html":"
Paragraph superseded on 07/08/2016 after the end of the transition period stated in Accounting Standards Update No. 2013-04, Liabilities (Topic 405): Obligations Resulting from Joint and Several Liability Arrangements for Which the Total Amount of the Obligation Is Fixed at the Reporting Date.
","snippet":"Paragraph superseded on 07/08/2016 after the end of the transition period stated in Accounting Standards Update No. 2013-04, Liabilities (Topic 405): Obligations Resulting from Joint and Several Liability Arrangements fo…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:d56802dd7457e6394cd232e442c0597c5299b7a3693c0048f5704f572b017ef0","downloaded_from":"2026-09-10T00:15:11.947Z","last_downloaded_at":"2026-09-10T00:15:11.947Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477087","source_sha256":"e042769f619914e0c65eb638a9d43f65ed4f0d2371f4403657fab61e2ba8c9ba"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:d05f29956294b873ab8989ed43f96f51e46fb6c0529c64489ce9e273dce87075","downloaded_from":"2026-09-10T00:15:11.947Z","last_downloaded_at":"2026-09-10T00:15:11.947Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477087","source_sha256":"e042769f619914e0c65eb638a9d43f65ed4f0d2371f4403657fab61e2ba8c9ba"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:58e2b0fc864c9534ccee9910749d0b8196977fc70eea8f3bad2d08070fa764d5","downloaded_from":"2026-09-10T00:15:11.947Z","last_downloaded_at":"2026-09-10T00:15:11.947Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477087","source_sha256":"e042769f619914e0c65eb638a9d43f65ed4f0d2371f4403657fab61e2ba8c9ba"}}],"enrichment":{"summary":"ASC 405-40 governs how an entity recognizes, measures, and discloses obligations arising from joint and several liability arrangements when the total amount of the obligation is fixed at the reporting date (e.g., debt with co-obligors, settled litigation shared with other defendants). The core measurement rule is that the reporting entity records the amount it agreed to pay under its arrangement with co-obligors plus any additional amount it expects to pay on behalf of those co-obligors. Scope excludes obligations already covered by Topics 410, 450, 460, 715, and 740.","key_points":["The Subtopic applies only when the total amount of the obligation is fixed at the reporting date, meaning no measurement uncertainty exists as to the total, though the total may later change for reasons unrelated to measurement uncertainty such as additional borrowings or interest rate changes (405-40-15-1).","Obligations accounted for under Topic 410 (asset retirement/environmental), Topic 450 (contingencies), Topic 460 (guarantees), Topic 715 (retirement benefits), and Topic 740 (income taxes) are scoped out (405-40-15-1).","The amount the entity expects to pay on behalf of co-obligors may be uncertain even though the total obligation is fixed (405-40-15-2).","Recognition occurs when the arrangement enters the Subtopic's scope, which may be at inception (e.g., a debt arrangement) or later, when the total obligation becomes fixed (405-40-25-1).","Initial measurement equals the amount the entity agreed to pay under the co-obligor arrangement plus any additional amount it expects to pay on behalf of co-obligors; within a range, use the best estimate, or the minimum of the range if no amount is a better estimate (405-40-30-1).","The corresponding entry depends on facts and circumstances — examples include cash for debt proceeds, an expense for a legal settlement, a receivable assessed for impairment for a contractual right, or an equity transaction with a common-control entity (405-40-25-2).","Required disclosures include the nature of the arrangement, the total outstanding amount not reduced by amounts recoverable from others, carrying amounts of the liability and any receivable, recourse provisions, and the corresponding entry and where it was recorded in the period of initial recognition or significant remeasurement (405-40-50-1); these are incremental to Topic 850 related-party disclosures (405-40-50-2)."],"categories":["Recognition","Initial measurement","Subsequent measurement","Disclosure"],"audience_level":"intermediate","student_note":"This Subtopic filled a gap where entities inconsistently reported only their allocated share of jointly owed debt or settlements; the common misunderstanding is thinking the entity records only its agreed share \\u2014 it must add amounts it expects to pay for co-obligors and must disclose the full outstanding amount without offsetting expected recoveries.","related_topics":["410","450","460","715","740","850"],"key_concepts":["joint and several liability","co-obligors","fixed total obligation","measurement uncertainty","expected additional amount","recourse provisions","corresponding entry","range of 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timestamps"}},{"number":"440-10","title":"Overall","topic_title":"Commitments","score":0.7156,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:7ace5a6503a52a958862ec25588d0779ce32a6743aff2d7681af7fd130ad98be","downloaded_from":"2026-09-10T00:25:16.890Z","last_downloaded_at":"2026-09-10T00:25:37.457Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"210-20","title":"Offsetting","topic_title":"Balance Sheet","score":0.7026,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:71d312da628fb519f13caf5212e900de6ed55de46714fdafc7f853e21e959b30","downloaded_from":"2026-09-09T22:59:04.667Z","last_downloaded_at":"2026-09-09T22:59:32.460Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"450-10","title":"Overall","topic_title":"Contingencies","score":0.7011,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:1a572fa5fcce9f11c3b92fd079c887dbaaf14c1f8323fc206a253af5db0348d0","downloaded_from":"2026-09-10T00:26:49.502Z","last_downloaded_at":"2026-09-10T00:26:58.831Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"405-954","title":"Health Care Entities","topic_title":"Liabilities","score":0.6937,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:42fb522543e4de163b7eb442d851dd75e5a048d127678b5c40f3ae5cd658710e","downloaded_from":"2026-09-10T00:19:21.041Z","last_downloaded_at":"2026-09-10T00:19:37.991Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"410-20","title":"Asset Retirement Obligations","topic_title":"Asset Retirement and Environmental Obligations","score":0.6832,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:eadcfdba370f824b3d3a584c7b3473194ae4c09cb6ec03f77ed0ba80ee93f125","downloaded_from":"2026-09-10T00:20:40.400Z","last_downloaded_at":"2026-09-10T00:21:17.061Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}}],"prev":{"number":"405-30","title":"Insurance-Related Assessments","topic_title":"Liabilities","provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:544e748d2deb9ed2691cf49df01b66797287eb151417edbf0bbd83c227c0c953","downloaded_from":"2026-09-10T00:14:14.713Z","last_downloaded_at":"2026-09-10T00:14:44.711Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},"next":{"number":"405-50","title":"Liabilities—Supplier Finance Programs","topic_title":"Liabilities","provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:9fa81059778ed610fec6c6bda8860ec906fa8eda124fad427cd256bbdc726c83","downloaded_from":"2026-09-10T00:15:18.657Z","last_downloaded_at":"2026-09-10T00:15:40.809Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:67eb03e66f32ef81003873160da986f5b10ab557b17074f49b3acc9059697c11","downloaded_from":"2026-09-10T00:14:46.909Z","last_downloaded_at":"2026-09-10T00:15:14.537Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"405-50","topic":"405","title":"Liabilities—Supplier Finance Programs","area":"Liabilities","paragraphs":18,"summary":"ASC 405-50 is a disclosure-only subtopic requiring the buyer in a supplier finance program (also called reverse factoring, payables finance, or structured payables) to disclose qualitative and quantitative information about the program. A supplier finance program exists when the buyer agrees with a finance provider or intermediary, confirms supplier invoices as valid to that party, and the supplier can request early payment from a party other than the buyer (405-50-15-2). The subtopic does not address recognition, measurement, or balance sheet presentation of the obligation, or the accounting by other parties (405-50-10-2).","concepts":["supplier finance program","reverse factoring","confirmed invoice","finance provider or intermediary","rollforward disclosure","trade payables","interim disclosure","balance sheet presentation"],"categories":["Disclosure","Presentation","Financial statement presentation","Debt and equity"],"level":"intermediate","topic_title":"Liabilities","sections":[{"number":"00","label":"00 Status","anchor":"00-status","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-50-00-1","para":"00-1","html":"
The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
405-50-05-1AddedAccounting Standards Update No. 2022-0409/29/2022
405-50-10-1AddedAccounting Standards Update No. 2022-0409/29/2022
405-50-10-2AddedAccounting Standards Update No. 2022-0409/29/2022
405-50-15-1 through 15-4
AddedAccounting Standards Update No. 2022-0409/29/2022
405-50-50-1 through 50-4
AddedAccounting Standards Update No. 2022-0409/29/2022
405-50-55-1 through 55-5
AddedAccounting Standards Update No. 2022-0409/29/2022
405-50-65-1AddedAccounting Standards Update No. 2022-0409/29/2022
","snippet":"The following table identifies the changes made to this Subtopic.\nParagraph | Action | Accounting Standards Update | Date |\n| | | |\n405-50-05-1 | Added | Accounting Standards Update No. 2022-04 | 09/29/2022 |\n405-50-10-1…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:6e75694c86a661991fafb4a6af40df2a565aa83749bcc04a7eaaddf111ea1a54","downloaded_from":"2026-09-10T00:15:18.657Z","last_downloaded_at":"2026-09-10T00:15:18.657Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479621","source_sha256":"cf454e33a9fba34218cafdfedede517abec69289e9db1cb76a78d2b0b56c7610"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:fcc8d07e7b633bf115bce920b04447c69cacc438c6329e1b5c8e277a17e94468","downloaded_from":"2026-09-10T00:15:18.657Z","last_downloaded_at":"2026-09-10T00:15:18.657Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479621","source_sha256":"cf454e33a9fba34218cafdfedede517abec69289e9db1cb76a78d2b0b56c7610"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:cc05a60a85fb933f48887cfae91123ed99452ea50958fe145ea80f17651d74e4","downloaded_from":"2026-09-10T00:15:18.657Z","last_downloaded_at":"2026-09-10T00:15:18.657Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479621","source_sha256":"cf454e33a9fba34218cafdfedede517abec69289e9db1cb76a78d2b0b56c7610"}},{"number":"05","label":"05 Overview and Background","anchor":"05-overview-and-background","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-50-05-1","para":"05-1","html":"
This Subtopic addresses the disclosures applicable for an entity that uses a supplier finance program in connection with the purchase of goods and services (the buyer in a supplier finance program). A supplier finance program also may be referred to as a reverse factoring, payables finance, or structured payables arrangement.
","snippet":"This Subtopic addresses the disclosures applicable for an entity that uses a supplier finance program in connection with the purchase of goods and services (the buyer in a supplier finance program). A supplier finance pr…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:c3bee2a551e2be7c5a6505e9e9fdc970372e20cd64df2ad83159fe8306c758bd","downloaded_from":"2026-09-10T00:15:22.160Z","last_downloaded_at":"2026-09-10T00:15:22.160Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479591","source_sha256":"f722799239ac741f45424179e7a09e411465a7a2d9e70e2b1c8a40fa16bd60f4"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:eee33774dff0c24cc72b27ef738156b5d3adc66d717b12147284b465c93d9fad","downloaded_from":"2026-09-10T00:15:22.160Z","last_downloaded_at":"2026-09-10T00:15:22.160Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479591","source_sha256":"f722799239ac741f45424179e7a09e411465a7a2d9e70e2b1c8a40fa16bd60f4"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:6f0ecafb167b61b31b391bb492e77987581ead01d353062a6aff9cff03c822ba","downloaded_from":"2026-09-10T00:15:22.160Z","last_downloaded_at":"2026-09-10T00:15:22.160Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479591","source_sha256":"f722799239ac741f45424179e7a09e411465a7a2d9e70e2b1c8a40fa16bd60f4"}},{"number":"10","label":"10 Objectives","anchor":"10-objectives","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-50-10-1","para":"10-1","html":"
The objective of this Subtopic is to establish disclosures that enhance the transparency of a supplier finance program used by an entity in connection with the purchase of goods and services (the buyer in a supplier finance program).
","snippet":"The objective of this Subtopic is to establish disclosures that enhance the transparency of a supplier finance program used by an entity in connection with the purchase of goods and services (the buyer in a supplier fina…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:a459802c86131739f703de60214b2efe32b9cb4dd0cc30cdb1c57a56a9673905","downloaded_from":"2026-09-10T00:15:24.411Z","last_downloaded_at":"2026-09-10T00:15:24.411Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479560","source_sha256":"4b6d279b8ac31192466d008140c11bd0fbd4438fd0b25eadeb8151fe822d9fe5"}},{"citation":"405-50-10-2","para":"10-2","html":"
This Subtopic does not address either of the following:
  1. a
    A buyer’s recognition, measurement, or financial statement presentation of an obligation in connection with a supplier finance program
  2. b
    The accounting and disclosure for other parties involved in a supplier finance program.
","snippet":"This Subtopic does not address either of the following:\n(a) A buyer’s recognition, measurement, or financial statement presentation of an obligation in connection with a supplier finance program\n(b) The accounting and di…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:943a319230de66246bc74aedb5dc57b4b722ce16d34aab40e12a5ed484d95ced","downloaded_from":"2026-09-10T00:15:24.411Z","last_downloaded_at":"2026-09-10T00:15:24.411Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479560","source_sha256":"4b6d279b8ac31192466d008140c11bd0fbd4438fd0b25eadeb8151fe822d9fe5"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:9f05e09a160d1ceeb453b71fc194e10f1df4ed32809f3d5630654bf44ead2c72","downloaded_from":"2026-09-10T00:15:24.411Z","last_downloaded_at":"2026-09-10T00:15:24.411Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479560","source_sha256":"4b6d279b8ac31192466d008140c11bd0fbd4438fd0b25eadeb8151fe822d9fe5"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:e1fb71b49b81f01dbf2092a58c7374942aabacdd8735850d2caa6ae04564531b","downloaded_from":"2026-09-10T00:15:24.411Z","last_downloaded_at":"2026-09-10T00:15:24.411Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479560","source_sha256":"4b6d279b8ac31192466d008140c11bd0fbd4438fd0b25eadeb8151fe822d9fe5"}},{"number":"15","label":"15 Scope and Scope Exceptions","anchor":"15-scope-and-scope-exceptions","is_sec":false,"groups":[{"block":null,"heading":"Entities","paragraphs":[{"citation":"405-50-15-1","para":"15-1","html":"
The guidance in this Subtopic applies to all entities that use supplier finance programs in connection with the purchase of goods and services (buyers in a supplier finance program).
","snippet":"The guidance in this Subtopic applies to all entities that use supplier finance programs in connection with the purchase of goods and services (buyers in a supplier finance program).","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:c7c740dbe0f1d0d7d83db02807065a68ef56081d6ab75e1888d5ead448f27885","downloaded_from":"2026-09-10T00:15:27.496Z","last_downloaded_at":"2026-09-10T00:15:27.496Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479528","source_sha256":"b7b6e1d921e8402fee9135175cd497ac00de389a194196ca940845c7dd8e4fa8"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:11e8ca8e41d12f5002abdb9ef75a2c8c7cc3084f66c43a1d0d38622a58c26949","downloaded_from":"2026-09-10T00:15:27.496Z","last_downloaded_at":"2026-09-10T00:15:27.496Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479528","source_sha256":"b7b6e1d921e8402fee9135175cd497ac00de389a194196ca940845c7dd8e4fa8"}},{"block":null,"heading":"Transactions","paragraphs":[{"citation":"405-50-15-2","para":"15-2","html":"
The guidance in this Subtopic applies to obligations in connection with supplier finance programs. A supplier finance program is an arrangement that has all the following characteristics:
  1. a
    An entity enters into an agreement with a finance provider or an intermediary.
  2. b
    The entity confirms supplier invoices as valid to the finance provider or intermediary under the agreement described in (a).
  3. c
    The entity’s supplier has the option to request early payment from a party other than the entity for invoices that the entity has confirmed as valid.
","snippet":"The guidance in this Subtopic applies to obligations in connection with supplier finance programs. A supplier finance program is an arrangement that has all the following characteristics:\n(a) An entity enters into an agr…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:2ae812d914491168ad5ebe9bd389d99ddaf08becc64170d73f85b6034ea308d6","downloaded_from":"2026-09-10T00:15:27.496Z","last_downloaded_at":"2026-09-10T00:15:27.496Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479528","source_sha256":"b7b6e1d921e8402fee9135175cd497ac00de389a194196ca940845c7dd8e4fa8"}},{"citation":"405-50-15-3","para":"15-3","html":"
Although not determinative, an indicator that an entity may have a supplier finance program is the commitment to pay a party other than the supplier for a confirmed invoice without offset, deduction, or any other defenses to payment.
","snippet":"Although not determinative, an indicator that an entity may have a supplier finance program is the commitment to pay a party other than the supplier for a confirmed invoice without offset, deduction, or any other defense…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:4e80d3026606ca1e916391314abd92a62185b9639d590a8fc8756a7e8baa4eab","downloaded_from":"2026-09-10T00:15:27.496Z","last_downloaded_at":"2026-09-10T00:15:27.496Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479528","source_sha256":"b7b6e1d921e8402fee9135175cd497ac00de389a194196ca940845c7dd8e4fa8"}},{"citation":"405-50-15-4","para":"15-4","html":"
In determining whether an entity has established a supplier finance program and, therefore, is subject to the disclosures required by this Subtopic, all available evidence shall be considered, including arrangements between the entity and its finance provider or intermediary and between the entity and its suppliers whose invoices the entity has confirmed as valid to the finance provider or intermediary.
","snippet":"In determining whether an entity has established a supplier finance program and, therefore, is subject to the disclosures required by this Subtopic, all available evidence shall be considered, including arrangements betw…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:acde2bb918a820e2a988c677b10f430d3ef3f46a7314e8832c13f6110dc40be7","downloaded_from":"2026-09-10T00:15:27.496Z","last_downloaded_at":"2026-09-10T00:15:27.496Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479528","source_sha256":"b7b6e1d921e8402fee9135175cd497ac00de389a194196ca940845c7dd8e4fa8"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:2c45a3dc6e6c58ba14d65dba736a6eb52a0720d868a5575a81f496368f1906b5","downloaded_from":"2026-09-10T00:15:27.496Z","last_downloaded_at":"2026-09-10T00:15:27.496Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479528","source_sha256":"b7b6e1d921e8402fee9135175cd497ac00de389a194196ca940845c7dd8e4fa8"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:6ce4b7a63776818b7cdee8cd0484b7b22725b5a336a119ab03c27bca928dae4c","downloaded_from":"2026-09-10T00:15:27.496Z","last_downloaded_at":"2026-09-10T00:15:27.496Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479528","source_sha256":"b7b6e1d921e8402fee9135175cd497ac00de389a194196ca940845c7dd8e4fa8"}},{"number":"50","label":"50 Disclosure","anchor":"50-disclosure","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-50-50-1","para":"50-1","html":"
The objective of the requirements in this Subtopic is for an entity to disclose sufficient information to enable users of financial statements to understand the nature, activity during the period, changes from period to period, and potential magnitude of the entity’s supplier finance programs. To achieve that objective, an entity shall disclose qualitative and quantitative information about its supplier finance programs.
","snippet":"The objective of the requirements in this Subtopic is for an entity to disclose sufficient information to enable users of financial statements to understand the nature, activity during the period, changes from period to …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:c4d63a3f6a24c0186e4409a83fbb9ed142aae4461cf4b308de31bf6c3e196fe9","downloaded_from":"2026-09-10T00:15:33.286Z","last_downloaded_at":"2026-09-10T00:15:33.286Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479468","source_sha256":"87b0873afc32ec3f9f5e07a1aca1f9cf1589d9531f56a92711caa1312c3363ab"}},{"citation":"405-50-50-2","para":"50-2","html":"
An entity shall consider the level of detail necessary to satisfy the disclosure objective. If an entity uses more than one supplier finance program, the entity may aggregate disclosures, but not to the extent that useful information is obscured by the aggregation of programs that have substantially different characteristics.
","snippet":"An entity shall consider the level of detail necessary to satisfy the disclosure objective. If an entity uses more than one supplier finance program, the entity may aggregate disclosures, but not to the extent that usefu…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:331101834776d17022378510f8d08d534154e7988d9b25575c4912ce176c03d8","downloaded_from":"2026-09-10T00:15:33.286Z","last_downloaded_at":"2026-09-10T00:15:33.286Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479468","source_sha256":"87b0873afc32ec3f9f5e07a1aca1f9cf1589d9531f56a92711caa1312c3363ab"}},{"citation":"405-50-50-3","para":"50-3","html":"
In each annual reporting period, an entity shall disclose all the following information about its supplier finance programs:
  1. a
    The key terms of the program, including, but not limited to:
    1. 1
      A description of the payment terms, including payment timing and the basis for its determination
    2. 2
      Assets pledged as security or other forms of guarantees provided for the committed payment to the finance provider or intermediary.
    See paragraphs
    405-50-55-1 through 55-3
    for an illustrative example.
  2. b
    The amount of obligations outstanding at the end of the reporting period that the entity has confirmed as valid to the finance provider or intermediary under the program (that is, the amount of obligations confirmed under the program that remains unpaid by the entity) and the following information about those obligations:
    1. 1
      Where those obligations are presented in the balance sheet. If those obligations are presented in more than one balance sheet line item, then the entity shall disclose the amount outstanding at the end of the reporting period in each line item.
    2. 2
      A rollforward of those obligations showing, at a minimum, all the following:
      1. i
        The amount of those obligations outstanding at the beginning of the reporting period
      2. ii
        The amount of those obligations added to the program during the reporting period
      3. iii
        The amount of those obligations settled during the reporting period
      4. iv
        The amount of those obligations outstanding at the end of the reporting period.
","snippet":"In each annual reporting period, an entity shall disclose all the following information about its supplier finance programs:\n(a) The key terms of the program, including, but not limited to:\n(1) A description of the payme…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:1e7edcd551bb4f65aa05c9fcef4de41d451a9ba0fb0b04a0c20b09fb642e238a","downloaded_from":"2026-09-10T00:15:33.286Z","last_downloaded_at":"2026-09-10T00:15:33.286Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479468","source_sha256":"87b0873afc32ec3f9f5e07a1aca1f9cf1589d9531f56a92711caa1312c3363ab"}},{"citation":"405-50-50-4","para":"50-4","html":"
In each interim reporting period, an entity shall disclose the amount of obligations outstanding that the entity has confirmed as valid to the finance provider or intermediary under the supplier finance program at the end of the reporting period.
","snippet":"In each interim reporting period, an entity shall disclose the amount of obligations outstanding that the entity has confirmed as valid to the finance provider or intermediary under the supplier finance program at the en…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:5b8f19ff85cd6cfc2d86b86cfa7680210a7c227dc14dd2ce72b10d75ddb40e8a","downloaded_from":"2026-09-10T00:15:33.286Z","last_downloaded_at":"2026-09-10T00:15:33.286Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479468","source_sha256":"87b0873afc32ec3f9f5e07a1aca1f9cf1589d9531f56a92711caa1312c3363ab"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:1165e6bf10cd1ac532f2636194707fc4985346b2c8ad5e9d7e3a3a54fb39e0d3","downloaded_from":"2026-09-10T00:15:33.286Z","last_downloaded_at":"2026-09-10T00:15:33.286Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479468","source_sha256":"87b0873afc32ec3f9f5e07a1aca1f9cf1589d9531f56a92711caa1312c3363ab"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:5cd487b2ec05542f2b4678529cedb394a1515f8df9decf8e41411fb0fc24404f","downloaded_from":"2026-09-10T00:15:33.286Z","last_downloaded_at":"2026-09-10T00:15:33.286Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479468","source_sha256":"87b0873afc32ec3f9f5e07a1aca1f9cf1589d9531f56a92711caa1312c3363ab"}},{"number":"55","label":"55 Implementation Guidance and Illustrations","anchor":"55-implementation-guidance-and-illustrations","is_sec":false,"groups":[{"block":null,"heading":"Illustrations","paragraphs":[{"citation":"405-50-55-1","para":"55-1","html":"
Based on the limited facts and hypothetical fact pattern described in paragraph 405-50-55-2, this Example illustrates how an entity might apply the guidance in paragraph 405-50-50-3(a) to disclose the key terms of a supplier finance program, including a description of the payment terms (which includes payment timing and basis for its determination) and the assets pledged as security or other forms of guarantees provided for the committed payment to the finance provider or intermediary. This Example is not intended to illustrate every aspect of the key terms of a program that should be disclosed by a buyer entity. Identifying the key terms of a supplier finance program is a matter of judgment, based upon the facts of the arrangement.
","snippet":"Based on the limited facts and hypothetical fact pattern described in paragraph 405-50-55-2, this Example illustrates how an entity might apply the guidance in paragraph 405-50-50-3(a) to disclose the key terms of a supp…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:94ba8d2cd70e1af27ff3b9e8888f24f48c43b5322224f421e5be8b1fefe7b078","downloaded_from":"2026-09-10T00:15:36.231Z","last_downloaded_at":"2026-09-10T00:15:36.231Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477128","source_sha256":"0b7ed804b731fb728ef09b4f42cee8abe73a62a52f2be987b31aae658375e96c"}},{"citation":"405-50-55-2","para":"55-2","html":"
Entity A enters into a supplier finance program with Bank B in which Entity A agrees to pay Bank B on the invoice maturity dates the stated amount of invoices that Entity A has confirmed on Bank B’s supplier finance platform. Entity A pays Bank B an annual subscription fee for the supplier finance platform and a service fee for related support. Entity A or Bank B may terminate the agreement upon at least 90 days’ notice. The agreement with Bank B does not require that Entity A provide assets pledged as security or other forms of guarantees for the supplier finance program. Bank B does not advise Entity A of the maximum size of the program. Bank B also enters into a separate arrangement with Entity A’s suppliers and provides them with the option to request early payment from Bank B for invoices confirmed by Entity A. Entity A does not determine the terms or conditions of the arrangement between Bank B and Entity A’s suppliers. Entity A does not participate in the transactions between its suppliers and Bank B. The supplier invoices that have been confirmed as valid under the program require payment in full within 90 days of the invoice date.
","snippet":"Entity A enters into a supplier finance program with Bank B in which Entity A agrees to pay Bank B on the invoice maturity dates the stated amount of invoices that Entity A has confirmed on Bank B’s supplier finance plat…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8f84c75659e8071cce24c7c901c46fc76d67c39f46de26a6813b086491176fc1","downloaded_from":"2026-09-10T00:15:36.231Z","last_downloaded_at":"2026-09-10T00:15:36.231Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477128","source_sha256":"0b7ed804b731fb728ef09b4f42cee8abe73a62a52f2be987b31aae658375e96c"}},{"citation":"405-50-55-3","para":"55-3","html":"
Entity A determined that it should disclose the following information on the key terms of its supplier finance program:
  • Under a supplier finance program, Entity A agrees to pay a bank the stated amount of confirmed invoices from its designated suppliers on the original maturity dates of the invoices, an annual subscription fee for the supplier finance platform, and service fees for related support. Entity A or the bank may terminate the agreement upon at least 90 days’ notice. The supplier invoices that have been confirmed as valid under the program require payment in full within 90 days of the invoice date.
","snippet":"Entity A determined that it should disclose the following information on the key terms of its supplier finance program:\nUnder a supplier finance program, Entity A agrees to pay a bank the stated amount of confirmed invoi…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:bfdb1582a77838e26e45fbf3b0fd72c28bc5826c4734994755cdf718a40c1169","downloaded_from":"2026-09-10T00:15:36.231Z","last_downloaded_at":"2026-09-10T00:15:36.231Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477128","source_sha256":"0b7ed804b731fb728ef09b4f42cee8abe73a62a52f2be987b31aae658375e96c"}},{"citation":"405-50-55-4","para":"55-4","html":"
This Example provides an illustration of the guidance in paragraph 405-50-50-3(b)(2) based on the assumptions that Entity A provides one comparative balance sheet and that its supplier finance program is denominated in Entity A’s reporting currency.
","snippet":"This Example provides an illustration of the guidance in paragraph 405-50-50-3(b)(2) based on the assumptions that Entity A provides one comparative balance sheet and that its supplier finance program is denominated in E…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:62b0fa53a2cd6e32d421ce0f4e850f99f6912460f0d7a8df4d005be618cbc1b5","downloaded_from":"2026-09-10T00:15:36.231Z","last_downloaded_at":"2026-09-10T00:15:36.231Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477128","source_sha256":"0b7ed804b731fb728ef09b4f42cee8abe73a62a52f2be987b31aae658375e96c"}},{"citation":"405-50-55-5","para":"55-5","html":"
The following illustrates the disclosures in a tabular format.
  • The rollforwards of Entity A’s outstanding obligations confirmed as valid under its supplier finance program for years ended December 31, 20X2, and 20X1, are as follows (in thousands):
  • 20X2 20X1 Confirmed obligations outstanding at the beginning of the year $ 733 $ 712 Invoices confirmed during the year \"2,435 \" \"2,278 \" Confirmed invoices paid during the year \"(2,315)\" \"(2,257)\" Confirmed obligations outstanding at the end of the year $ 853
","snippet":"The following illustrates the disclosures in a tabular format.\nThe rollforwards of Entity A’s outstanding obligations confirmed as valid under its supplier finance program for years ended December 31, 20X2, and 20X1, are…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f4f34a5a0b5dd1208481e1c24399a2ad7d211b10ceabb2d5109bc7f3869f3219","downloaded_from":"2026-09-10T00:15:36.231Z","last_downloaded_at":"2026-09-10T00:15:36.231Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477128","source_sha256":"0b7ed804b731fb728ef09b4f42cee8abe73a62a52f2be987b31aae658375e96c"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:7cb92d708d06ddef1a164a1e8ff9eb58f18a9ee3edb1293c47a1b253a518ceeb","downloaded_from":"2026-09-10T00:15:36.231Z","last_downloaded_at":"2026-09-10T00:15:36.231Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477128","source_sha256":"0b7ed804b731fb728ef09b4f42cee8abe73a62a52f2be987b31aae658375e96c"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:531807bbdcccacf3234784d690774c988633768d7a36e41ffce89f639ae0c486","downloaded_from":"2026-09-10T00:15:36.231Z","last_downloaded_at":"2026-09-10T00:15:36.231Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477128","source_sha256":"0b7ed804b731fb728ef09b4f42cee8abe73a62a52f2be987b31aae658375e96c"}},{"number":"65","label":"65 Transition and Open Effective Date Information","anchor":"65-transition-and-open-effective-date-information","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-50-65-1","para":"65-1","html":"
Paragraph superseded on 07/02/2026 after the end of the transition period stated in Accounting Standards Update No. 2022-04, Liabilities—Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations.
","snippet":"Paragraph superseded on 07/02/2026 after the end of the transition period stated in Accounting Standards Update No. 2022-04, Liabilities—Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:93a8b45ca22108289a7439c1033513ee4e81657de5bc923ce4b53198d6406235","downloaded_from":"2026-09-10T00:15:38.064Z","last_downloaded_at":"2026-09-10T00:15:38.064Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477123","source_sha256":"bcbafa0d9afd4e9261f9dea0fabd973b8c2aa376929d9411d172858eb9e4dab4"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:df8409f152ac978979a10efee3b4f3f03e58907e6dceb1fc8ff61f1bbeb87646","downloaded_from":"2026-09-10T00:15:38.064Z","last_downloaded_at":"2026-09-10T00:15:38.064Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477123","source_sha256":"bcbafa0d9afd4e9261f9dea0fabd973b8c2aa376929d9411d172858eb9e4dab4"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:b90753a0cb58c9448a222972cf68df9d21467918ded2c3ac16c1d0a887e9cc0c","downloaded_from":"2026-09-10T00:15:38.064Z","last_downloaded_at":"2026-09-10T00:15:38.064Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477123","source_sha256":"bcbafa0d9afd4e9261f9dea0fabd973b8c2aa376929d9411d172858eb9e4dab4"}}],"enrichment":{"summary":"ASC 405-50 is a disclosure-only subtopic requiring the buyer in a supplier finance program (also called reverse factoring, payables finance, or structured payables) to disclose qualitative and quantitative information about the program. A supplier finance program exists when the buyer agrees with a finance provider or intermediary, confirms supplier invoices as valid to that party, and the supplier can request early payment from a party other than the buyer (405-50-15-2). The subtopic does not address recognition, measurement, or balance sheet presentation of the obligation, or the accounting by other parties (405-50-10-2).","key_points":["Scope: applies to all buyers using arrangements with the three characteristics in 405-50-15-2 — an agreement with a finance provider/intermediary, buyer confirmation of supplier invoices as valid, and the supplier's option to request early payment from a party other than the buyer.","An indicator (not determinative) of a supplier finance program is a commitment to pay a party other than the supplier for a confirmed invoice without offset, deduction, or other defenses to payment (405-50-15-3); all available evidence, including buyer-supplier arrangements, must be considered (405-50-15-4).","The subtopic is disclosure-only: it does not address the buyer's recognition, measurement, or financial statement presentation of the obligation, nor accounting by other parties to the program (405-50-10-2).","Disclosure objective is to let users understand the nature, activity during the period, changes from period to period, and potential magnitude of the programs (405-50-50-1); multiple programs may be aggregated unless aggregation obscures useful information about programs with substantially different characteristics (405-50-50-2).","Annually, disclose key terms — payment terms including payment timing and the basis for its determination, and assets pledged as security or other forms of guarantees for the committed payment (405-50-50-3(a)).","Annually, disclose the amount of obligations confirmed as valid and unpaid at period-end, where they are presented in the balance sheet (by line item if more than one), and a rollforward showing beginning balance, additions, settlements, and ending balance (405-50-50-3(b)).","In each interim reporting period, disclose the amount of confirmed obligations outstanding at the end of the period (405-50-50-4)."],"categories":["Disclosure","Presentation","Financial statement presentation","Debt and equity"],"audience_level":"intermediate","student_note":"This is a transparency rule born of concerns that reverse factoring lets companies stretch payment terms while still classifying the obligation as a trade payable rather than debt; the common misunderstanding is thinking ASC 405-50 dictates that classification — it does not, it only requires the buyer to disclose where the obligation is presented and how it moved during the period.","related_topics":["470","860","230","270","405-40"],"key_concepts":["supplier finance program","reverse factoring","confirmed invoice","finance provider or intermediary","rollforward disclosure","trade payables","interim disclosure","balance sheet 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When a pooling marketing cooperative's board assigns amounts to unprocessed products received from patrons, those assigned amounts must approximate estimated net realizable value and are credited to amounts due patrons, creating a short-term liability. Excess of pool revenues over assigned amounts and operating costs is paid or allocated to patrons pro rata, and retained allocated equities may be mandatorily redeemable instruments requiring liability classification under Subtopic 480-10.","concepts":["agricultural cooperative","pooling cooperative","amounts due patrons","assigned amounts","estimated net realizable value","per-unit retains","retained allocated equities","mandatorily redeemable financial instruments"],"categories":["Recognition","Initial measurement","Industry-specific","Debt and equity"],"level":"intermediate","topic_title":"Liabilities","sections":[{"number":"00","label":"00 Status","anchor":"00-status","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-905-00-1","para":"00-1","html":"
The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
Agricultural CooperativeAddedAccounting Standards Update No. 2014-0603/14/2014
CooperativesSupersededAccounting Standards Update No. 2014-0603/14/2014
Member of an Agricultural CooperativeAddedAccounting Standards Update No. 2014-0603/14/2014
Net Realizable ValueAddedAccounting Standards Update No. 2015-1107/22/2015
Nonmember of an Agricultural CooperativeAddedAccounting Standards Update No. 2014-0603/14/2014
PatronsAmendedAccounting Standards Update No. 2014-0603/14/2014
905-405-05-1AmendedAccounting Standards Update No. 2014-0603/14/2014
905-405-05-2AmendedAccounting Standards Update No. 2014-0603/14/2014
905-405-15-2AmendedAccounting Standards Update No. 2014-0603/14/2014
905-405-25-1AmendedAccounting Standards Update No. 2015-1107/22/2015
905-405-25-1AmendedAccounting Standards Update No. 2014-0603/14/2014
905-405-30-1AmendedAccounting Standards Update No. 2014-0603/14/2014
905-405-30-3AmendedAccounting Standards Update No. 2014-0603/14/2014
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This Subtopic addresses liabilities for entities in the agricultural industry. The guidance for accounting by agricultural cooperatives is presented in the Cooperatives Subsections.
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The Cooperatives Subsections provide guidance for agricultural cooperatives accounting for product deliveries from patrons.
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This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see the General Subsection of Section 905-10-15.
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The Cooperatives Subsections follow the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see the Cooperatives Subsection of Section 905-10-15.
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If the boards of directors of agricultural marketing cooperatives operating on a pooling basis with no obligation to pay patrons fixed prices (pooling cooperatives) assign amounts that approximate estimated net realizable value to unprocessed products received from patrons, the assigned amounts shall be credited to amounts due patrons. When assigned amounts are used, they should approximate estimated net realizable value of unprocessed products delivered by patrons (an example of inventories at lower of cost and net realizable value is provided in Example 1 (see paragraph 905-330-55-1)).
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The cooperative estimates a liability to patrons equal to the assigned amount for the delivered product, and it usually pays this liability on a short-term basis. The excess of revenues over the assigned amounts and operating costs at the end of a pool period, which may be a week, a month, a year, or longer, is paid or allocated to patrons. Assets equal to that excess may be distributed to the patrons or retained by the cooperative.
","snippet":"The cooperative estimates a liability to patrons equal to the assigned amount for the delivered product, and it usually pays this liability on a short-term basis. The excess of revenues over the assigned amounts and oper…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:3a56870ab6cafa53ad699f5b43c5841b293a2bf5b5c41863ac673b2af1583f33","downloaded_from":"2026-09-10T00:15:59.322Z","last_downloaded_at":"2026-09-10T00:15:59.322Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478826","source_sha256":"6ae7917e2fb977d66d072a9c9264a6111b9bd92860927aa8f422e1b9ef3d5c36"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:36bbcc3f37a6514538cccba7bbeff070eb6ac83bb59904280b82b3661f0e25cf","downloaded_from":"2026-09-10T00:15:59.322Z","last_downloaded_at":"2026-09-10T00:15:59.322Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478826","source_sha256":"6ae7917e2fb977d66d072a9c9264a6111b9bd92860927aa8f422e1b9ef3d5c36"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:0e131a9efd3086750bfdf265ab7c352919d1ca5ff46a1c928f235e37ac54f3e4","downloaded_from":"2026-09-10T00:15:59.322Z","last_downloaded_at":"2026-09-10T00:15:59.322Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478826","source_sha256":"6ae7917e2fb977d66d072a9c9264a6111b9bd92860927aa8f422e1b9ef3d5c36"}},{"number":"30","label":"30 Initial Measurement","anchor":"30-initial-measurement","is_sec":false,"groups":[{"block":"Cooperatives","heading":null,"paragraphs":[{"citation":"405-905-30-1","para":"30-1","html":"
Many marketing cooperatives commingle patrons' fungible products in pools. The excess of revenues over costs for each pool is allocated to patrons on the basis of their pro rata contributions to the pool, which may be determined by the number of units delivered, the volume of product delivered, or another equitable method.
","snippet":"Many marketing cooperatives commingle patrons' fungible products in pools. The excess of revenues over costs for each pool is allocated to patrons on the basis of their pro rata contributions to the pool, which may be de…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:6dd67bd28b7c8f646e38019ca9940ca9a6c72849992d06fcc71ae341f003bb49","downloaded_from":"2026-09-10T00:16:03.076Z","last_downloaded_at":"2026-09-10T00:16:03.076Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478062","source_sha256":"45b296ca8c73606d3b67502599cd7a12267377a824ab313202685b0d90dbb017"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:be5a6b710c1f993601c5e6cbc240cc58d34c7d54a4489b19230164b28bee75b0","downloaded_from":"2026-09-10T00:16:03.076Z","last_downloaded_at":"2026-09-10T00:16:03.076Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478062","source_sha256":"45b296ca8c73606d3b67502599cd7a12267377a824ab313202685b0d90dbb017"}},{"block":"Cooperatives","heading":"Retains","paragraphs":[{"citation":"405-905-30-2","para":"30-2","html":"
Marketing cooperatives often deduct per-unit retains from the estimated proceeds due producers. Per-unit retains are based on the quantity of product delivered by the producer and are a method of financing for the cooperative. See the Cooperatives—Patrons Subsection of Section 905-325-30 for treatment of retains by cooperative patrons.
","snippet":"Marketing cooperatives often deduct per-unit retains from the estimated proceeds due producers. Per-unit retains are based on the quantity of product delivered by the producer and are a method of financing for the cooper…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:11c8be9c0d3e86cab402d4a39f0b39654fc92285e9a9983570f616f6ea84947a","downloaded_from":"2026-09-10T00:16:03.076Z","last_downloaded_at":"2026-09-10T00:16:03.076Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478062","source_sha256":"45b296ca8c73606d3b67502599cd7a12267377a824ab313202685b0d90dbb017"}},{"citation":"405-905-30-3","para":"30-3","html":"
When agricultural cooperatives have retained allocated equities, they are usually repaid to cooperative patrons over a specific number of years. These retained allocated equities may meet the definition of mandatorily redeemable financial instruments under Subtopic 480-10 and as such may have to be classified as liabilities.
","snippet":"When agricultural cooperatives have retained allocated equities, they are usually repaid to cooperative patrons over a specific number of years. These retained allocated equities may meet the definition of mandatorily re…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:9db89eeca1cd7c9a369843f4b45e8ee5328340e856a0e5856ac728644aee825b","downloaded_from":"2026-09-10T00:16:03.076Z","last_downloaded_at":"2026-09-10T00:16:03.076Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478062","source_sha256":"45b296ca8c73606d3b67502599cd7a12267377a824ab313202685b0d90dbb017"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:5b444a12ee66607986896ec9b17b079775da6bbeeb254e841c7cb76960b77fb0","downloaded_from":"2026-09-10T00:16:03.076Z","last_downloaded_at":"2026-09-10T00:16:03.076Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478062","source_sha256":"45b296ca8c73606d3b67502599cd7a12267377a824ab313202685b0d90dbb017"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:a314f60d1bf2c3c6f28883f7a06999ffa6fce6981d195669f7beaab9c654aec3","downloaded_from":"2026-09-10T00:16:03.076Z","last_downloaded_at":"2026-09-10T00:16:03.076Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478062","source_sha256":"45b296ca8c73606d3b67502599cd7a12267377a824ab313202685b0d90dbb017"}}],"enrichment":{"summary":"ASC 405-905 governs liabilities of agricultural entities, with Cooperatives Subsections addressing how agricultural cooperatives account for product deliveries from patrons. When a pooling marketing cooperative's board assigns amounts to unprocessed products received from patrons, those assigned amounts must approximate estimated net realizable value and are credited to amounts due patrons, creating a short-term liability. Excess of pool revenues over assigned amounts and operating costs is paid or allocated to patrons pro rata, and retained allocated equities may be mandatorily redeemable instruments requiring liability classification under Subtopic 480-10.","key_points":["Pooling cooperatives (marketing cooperatives operating on a pooling basis with no obligation to pay patrons fixed prices) that assign amounts to unprocessed products received from patrons must credit those assigned amounts to amounts due patrons, and the assigned amounts should approximate estimated net realizable value (405-905-25-1).","The cooperative estimates a liability to patrons equal to the assigned amount for delivered product and usually pays it on a short-term basis (405-905-25-2).","At the end of a pool period (a week, month, year, or longer), the excess of revenues over assigned amounts and operating costs is paid or allocated to patrons, and assets equal to that excess may be distributed or retained by the cooperative (405-905-25-2).","Where patrons' fungible products are commingled in pools, the excess of revenues over costs for each pool is allocated to patrons pro rata based on units delivered, volume delivered, or another equitable method (405-905-30-1).","Per-unit retains, deducted from estimated proceeds due producers and based on quantity delivered, are a financing method for the cooperative; patron-side treatment is in the Cooperatives—Patrons Subsection of Section 905-325-30 (405-905-30-2).","Retained allocated equities, usually repaid to patrons over a specified number of years, may meet the definition of mandatorily redeemable financial instruments under Subtopic 480-10 and may have to be classified as liabilities (405-905-30-3).","Scope follows the General and Cooperatives Subsections of Section 905-10-15 (405-905-15-1 and 15-2)."],"categories":["Recognition","Initial measurement","Industry-specific","Debt and equity"],"audience_level":"intermediate","student_note":"Tested rarely but a clean illustration of substance-over-form: a cooperative's obligation to its patron-owners is a liability measured at assigned amounts approximating NRV, not equity. The common misunderstanding is assuming all patron equities are equity — retained allocated equities repayable over a set number of years may be mandatorily redeemable and thus liabilities under ASC 480-10.","related_topics":["905-10","905-330","905-325","480-10","905-505"],"key_concepts":["agricultural cooperative","pooling cooperative","amounts due patrons","assigned amounts","estimated net realizable value","per-unit retains","retained allocated equities","mandatorily redeemable financial instruments"],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:764c8f529ae9f86ed5de2055817d3e10c0d43e91f9f74b30709f309a393e51dc","downloaded_from":"2026-09-10T00:15:44.426Z","last_downloaded_at":"2026-09-10T00:16:03.076Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},"related":[{"number":"310-905","title":"Agriculture","topic_title":"Receivables","score":0.8067,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:835d9aceeafc85508b33d980454773246f4a2dd4f987af6693d018fff27669f9","downloaded_from":"2026-09-09T23:27:49.582Z","last_downloaded_at":"2026-09-09T23:28:04.502Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"330-905","title":"Agriculture","topic_title":"Inventory","score":0.8019,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:68e7b13fea707f4163e46a12fad71955cb0438aed817d80e54cdaceca658badd","downloaded_from":"2026-09-09T23:51:23.210Z","last_downloaded_at":"2026-09-09T23:51:52.923Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"325-905","title":"Agriculture","topic_title":"Investments—Other","score":0.7973,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:146ff99d557edd565f2719c4eb6a13a58d2a898cd827eb90dbcff01b4dc1263b","downloaded_from":"2026-09-09T23:45:01.186Z","last_downloaded_at":"2026-09-09T23:45:25.642Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"605-905","title":"Agriculture","topic_title":"Revenue Recognition","score":0.794,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:6dfb6288c796bb97d35580525eedc62b204d670f6daf9acb0b104daa9080f9de","downloaded_from":"2026-09-10T00:45:40.215Z","last_downloaded_at":"2026-09-10T00:45:59.310Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"705-905","title":"Agriculture","topic_title":"Cost of Sales and Services","score":0.7905,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:ff2254d54b95b85e04f6d7042b0a650b714579219f00234bdb2c1d60d1d62443","downloaded_from":"2026-09-10T00:56:04.703Z","last_downloaded_at":"2026-09-10T00:56:11.435Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not 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Every paragraph in the subtopic — Sections 05, 15, 45, and 50 — was superseded by ASU 2014-09 (Revenue from Contracts with Customers). As a result, the subtopic contains no operative guidance; contract liabilities of construction contractors are now addressed under ASC 606 (and contract costs under ASC 340-40).","concepts":["superseded guidance","construction contractors","contract liability","billings in excess of costs","revenue from contracts with customers","codification research"],"categories":["Presentation","Disclosure","Revenue","Transition and effective dates"],"level":"intermediate","topic_title":"Liabilities","sections":[{"number":"00","label":"00 Status","anchor":"00-status","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-910-00-1","para":"00-1","html":"
The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
910-405-05-1SupersededAccounting Standards Update No. 2014-0905/28/2014
910-405-15-1SupersededAccounting Standards Update No. 2014-0905/28/2014
910-405-45-1SupersededAccounting Standards Update No. 2014-0905/28/2014
910-405-45-2SupersededAccounting Standards Update No. 2014-0905/28/2014
910-405-50-1SupersededAccounting Standards Update No. 2014-0905/28/2014
910-405-50-2SupersededAccounting Standards Update No. 2014-0905/28/2014
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Every paragraph in the subtopic — Sections 05, 15, 45, and 50 — was superseded by ASU 2014-09 (Revenue from Contracts with Customers). As a result, the subtopic contains no operative guidance; contract liabilities of construction contractors are now addressed under ASC 606 (and contract costs under ASC 340-40).","key_points":["All content of ASC 405-910 was superseded by Accounting Standards Update No. 2014-09, including 405-910-05-1, 405-910-15-1, 405-910-45-1 and 45-2, and 405-910-50-1 and 50-2.","Because Sections 05 (Overview and Background), 15 (Scope), 45 (Other Presentation Matters), and 50 (Disclosure) are all superseded, the subtopic imposes no current recognition, presentation, or disclosure requirements.","Contractor obligations arising from customer contracts (for example, amounts billed or consideration received in advance of performance) are now accounted for as contract liabilities under ASC 606, with presentation guidance in 606-10-45-1 through 45-5.","Legacy construction-contractor liability guidance formerly linked to ASC 605-35 should not be applied for periods after the adoption of ASU 2014-09.","Researchers encountering citations to 405-910 in pre-2014-09 literature must map them to the corresponding ASC 606 (revenue) or ASC 340-40 (contract cost) guidance."],"categories":["Presentation","Disclosure","Revenue","Transition and effective dates"],"audience_level":"intermediate","student_note":"The only thing to know here is that this subtopic is entirely empty post-ASU 2014-09 — a common exam trap is citing legacy construction-contractor liability rules that no longer exist; go to ASC 606 for contract liabilities and ASC 340-40 for contract costs instead.","related_topics":["606","340-40","605-35","606-10","405-20"],"key_concepts":["superseded guidance","construction contractors","contract liability","billings in excess of costs","revenue from contracts with customers","codification 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Costs","score":0.8564,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:087846200cdbaa5b8c0c61a2a8abc4d1791a6283a67e2a631c1b430bf71e8833","downloaded_from":"2026-09-09T23:56:37.773Z","last_downloaded_at":"2026-09-09T23:56:47.153Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"605-910","title":"Contractors—Construction","topic_title":"Revenue Recognition","score":0.8282,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:4b7bd93bf13fdf0803783c5d22ed66f875d4327d4462eff48fe25beff191a179","downloaded_from":"2026-09-10T00:46:12.096Z","last_downloaded_at":"2026-09-10T00:46:24.233Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not 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Sheet","score":0.8099,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:0a3f04be324cdd4db2632c8d2cd360d06c86eae03a29a664984cd0d79c531d59","downloaded_from":"2026-09-09T22:59:35.983Z","last_downloaded_at":"2026-09-09T22:59:51.511Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"235-910","title":"Contractors—Construction","topic_title":"Notes to Financial Statements","score":0.7963,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:cb3dc9b47912018fd55222ff748ec1463c21ae6c8ce959db34a58b93edbdfb3e","downloaded_from":"2026-09-09T23:14:39.794Z","last_downloaded_at":"2026-09-09T23:14:49.098Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"235-912","title":"Contractors—Federal Government","topic_title":"Notes to Financial 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retrieval timestamps"}},{"number":"405-912","topic":"405","title":"Contractors—Federal Government","area":"Liabilities","paragraphs":16,"summary":"ASC 405-912 tells federal government contractors how to present and disclose liabilities arising from terminated contracts and from progress/advance payments. Termination loans (even if government-guaranteed) are third-party liabilities shown as current liabilities with cross-reference to the related claim; unliquidated advance payments on a terminated contract are deducted from the claim receivable. Progress and advance payments accounted for as borrowings under 912-310-25-7 are reported as cash received from financing activities.","concepts":["termination claim","termination loans","advance payments","progress payments as financing","cost-plus-fixed-fee contract","subcontractors' claims","government contractor","financing activities"],"categories":["Presentation","Disclosure","Cash flows","Industry-specific"],"level":"intermediate","topic_title":"Liabilities","sections":[{"number":"00","label":"00 Status","anchor":"00-status","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-912-00-1","para":"00-1","html":"
The following table identifies the changes made to this Subtopic.
Paragraph Action Accounting Standards Update Date
912-405-05-1 Amended Accounting Standards Update No. 2014-09 05/28/2014
912-405-25-1 Superseded Accounting Standards Update No. 2014-09 05/28/2014
912-405-25-2 Superseded Accounting Standards Update No. 2014-09 05/28/2014
912-405-45-1 Superseded Accounting Standards Update No. 2014-09 05/28/2014
912-405-45-2 Superseded Accounting Standards Update No. 2014-09 05/28/2014
912-405-45-6 Superseded Accounting Standards Update No. 2014-09 05/28/2014
912-405-50-1 Superseded Accounting Standards Update No. 2014-09 05/28/2014
912-405-50-2 Amended Maintenance Update 2016-11 (PDF) 06/27/2016
912-405-50-3 Amended Maintenance Update 2016-11 (PDF) 06/27/2016
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This Subtopic provides guidance to government contractors on accounting for liabilities associated with claims of subcontractors on cost-plus-fixed-fee contracts and progress payments.
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This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 912-10-15.
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Paragraph 912-310-25-7 provides guidance on the circumstances in which progress payments received shall be accounted for as a financing transaction.
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Loans negotiated on the security of the termination claim shall be shown as current liabilities.
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Termination loans are liabilities to third parties, even though guaranteed in whole or in part by the government, and shall be presented in the balance sheet as liabilities, with appropriate cross-reference to the related claim or claims.
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If a terminated contract is one on which advance payments had previously been received, the financial statements of the contractor issued before final collection of the claim shall reflect any balance of those advances as deductions from the claim receivable.
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If progress and advance payments are accounted for as borrowings, such amounts shall be reported as cash received from financing activities.
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Financial statements issued before the termination claim is recorded shall disclose, by note or otherwise, the relationship of advance payment or guaranteed loan liabilities to a possible termination claim receivable.
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To the extent that the amounts of subcontractors' claims are not reasonably determinable, disclosure shall be made by note or otherwise in the financial statements.
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Termination loans (even if government-guaranteed) are third-party liabilities shown as current liabilities with cross-reference to the related claim; unliquidated advance payments on a terminated contract are deducted from the claim receivable. Progress and advance payments accounted for as borrowings under 912-310-25-7 are reported as cash received from financing activities.","key_points":["The Subtopic addresses liabilities from subcontractors' claims on cost-plus-fixed-fee contracts and from progress payments (405-912-05-1), and follows the scope of Subtopic 912-10 (405-912-15-1).","Whether progress payments received are accounted for as a financing transaction is determined under paragraph 912-310-25-7 (405-912-25-3).","Loans negotiated on the security of a termination claim are presented as current liabilities (405-912-45-3).","Termination loans are liabilities to third parties even when guaranteed in whole or in part by the government, and are presented as balance sheet liabilities cross-referenced to the related claim (405-912-45-4).","Advance payments previously received on a terminated contract are reflected as deductions from the claim receivable in statements issued before final collection (405-912-45-5).","Progress and advance payments accounted for as borrowings are reported as cash received from financing activities (405-912-45-7).","Disclosure is required of the relationship of advance payment or guaranteed loan liabilities to a possible termination claim receivable (405-912-50-2) and of subcontractors' claims whose amounts are not reasonably determinable (405-912-50-3)."],"categories":["Presentation","Disclosure","Cash flows","Industry-specific"],"audience_level":"intermediate","student_note":"Most of the old recognition and classification guidance here was superseded by ASU 2014-09 (ASC 606), so what remains is essentially balance sheet presentation, cash flow classification, and disclosure. The common trap is assuming a government guarantee makes a termination loan something other than a liability, or netting the loan against the claim receivable — only prior advance payments are deducted from the claim.","related_topics":["912-310","912-10","606","912-605","230","405-20"],"key_concepts":["termination claim","termination loans","advance payments","progress payments as financing","cost-plus-fixed-fee contract","subcontractors' claims","government contractor","financing activities"],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:bd000688f5081528c224e4593c8ed9661320651c6c52c5d7804d0d010d31a935","downloaded_from":"2026-09-10T00:16:17.263Z","last_downloaded_at":"2026-09-10T00:16:37.609Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},"related":[{"number":"310-912","title":"Contractors—Federal Government","topic_title":"Receivables","score":0.8303,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:1656b2723d12b89b63a51a0fb1232db6f3f77f8d261b55674a7405fcdc886288","downloaded_from":"2026-09-09T23:28:22.756Z","last_downloaded_at":"2026-09-09T23:28:44.996Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"450-912","title":"Contractors—Federal Government","topic_title":"Contingencies","score":0.8038,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:78f5655d2ad56f110d63a7dc4d94cbf59d9fc7e4cc2e49674a0149fdbad9185d","downloaded_from":"2026-09-10T00:28:13.837Z","last_downloaded_at":"2026-09-10T00:28:25.535Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"912-20","title":"Contract Costs","topic_title":"Contractors—Federal Government","score":0.7916,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:cce356b650ea736062acbebcc3bb58030f90e93587a186a6a92c7bbccae35142","downloaded_from":"2026-09-10T02:10:07.952Z","last_downloaded_at":"2026-09-10T02:10:28.388Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"275-912","title":"Contractors—Federal Government","topic_title":"Risks and Uncertainties","score":0.7696,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:dae5e702f1f9a80acd07e72c557261218f2d13ebe69a3d331bad4f3597a54ca1","downloaded_from":"2026-09-09T23:22:22.572Z","last_downloaded_at":"2026-09-09T23:22:31.368Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"405-910","title":"Contractors—Construction","topic_title":"Liabilities","score":0.7217,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:06ff9a233100e52741dd9a3055c66afb9e6e2d9135a25e063e292c0b032f2eed","downloaded_from":"2026-09-10T00:16:06.424Z","last_downloaded_at":"2026-09-10T00:16:15.597Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not 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timestamps"}},{"number":"405-920","topic":"405","title":"Entertainment—Broadcasters","area":"Liabilities","paragraphs":8,"summary":"This Subtopic governs how broadcasters account for the liabilities they incur under license agreements for program material. A broadcaster recognizes both an asset (the program rights) and a liability when the license period begins and the conditions in 920-350-25-2 are met, measuring both at either the fair value or the gross amount of the liability, with any discount accreted as interest under Topic 835. The liability is then split between current and noncurrent on the balance sheet according to the payment terms.","concepts":["broadcast license agreement","program material rights","license period","gross versus present value measurement","imputed interest","current and noncurrent classification","broadcaster liabilities"],"categories":["Recognition","Initial measurement","Presentation","Industry-specific"],"level":"intermediate","topic_title":"Liabilities","sections":[{"number":"00","label":"00 Status","anchor":"00-status","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-920-00-1","para":"00-1","html":"
The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
BarterSupersededAccounting Standards Update No. 2014-0905/28/2014
920-405-25-2SupersededAccounting Standards Update No. 2014-0905/28/2014
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This Subtopic addresses the accounting and reporting by broadcasters for obligations incurred under broadcast license agreements.
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This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 920-10-15.
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Paragraph 920-350-25-2 requires that a broadcaster shall recognize an asset and a liability for the rights acquired and obligations incurred under a license agreement for program material when the license period begins and certain conditions specified in that paragraph are met.
","snippet":"Paragraph 920-350-25-2 requires that a broadcaster shall recognize an asset and a liability for the rights acquired and obligations incurred under a license agreement for program material when the license period begins a…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:3f3eb3d77e8502b818aa3370048c22dc877361570cc55bf8ef288370bcda8aee","downloaded_from":"2026-09-10T00:16:50.984Z","last_downloaded_at":"2026-09-10T00:16:50.984Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478593","source_sha256":"b5eed151b22c41e5259fcbd0f14b3bf4a0d54d18ea4d3d115e1cb4d05e634661"}},{"citation":"405-920-25-2","para":"25-2","html":"
Paragraph superseded by Accounting Standards Update No. 2014-09.
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A licensee shall report the asset and liability for a broadcast license agreement at either of the following:
  1. a
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  2. b
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If a present value technique is used to measure fair value, the difference between the gross and net liability shall be accounted for as interest in accordance with Topic 835.
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The liability recorded for the obligation incurred under a license agreement for program material shall be segregated between current and noncurrent based on the payment terms.
","snippet":"The liability recorded for the obligation incurred under a license agreement for program material shall be segregated between current and noncurrent based on the payment terms.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:ebd4ed3da1a02b3a621c5ec7b51ea2dc8a4c79937def8a57b699d1a981a0d012","downloaded_from":"2026-09-10T00:16:55.184Z","last_downloaded_at":"2026-09-10T00:16:55.184Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478414","source_sha256":"d8de3cde2fa74ae10c13f02e0adff34fb4d5cd474711e38e604d8051f9f3ab9c"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:124105ee1e4c353b9716a05cb404fd07b83a9771090348a007dcb4fcbaea76f8","downloaded_from":"2026-09-10T00:16:55.184Z","last_downloaded_at":"2026-09-10T00:16:55.184Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478414","source_sha256":"d8de3cde2fa74ae10c13f02e0adff34fb4d5cd474711e38e604d8051f9f3ab9c"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:377cae65dc25acff183a29da3346a72e266bd5e2bfcc10ebd7d78a1a065b319a","downloaded_from":"2026-09-10T00:16:55.184Z","last_downloaded_at":"2026-09-10T00:16:55.184Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478414","source_sha256":"d8de3cde2fa74ae10c13f02e0adff34fb4d5cd474711e38e604d8051f9f3ab9c"}},{"number":"55","label":"55 Implementation Guidance and Illustrations","anchor":"55-implementation-guidance-and-illustrations","is_sec":false,"groups":[{"block":null,"heading":"License Agreement for Program Material","paragraphs":[{"citation":"405-920-55-1","para":"55-1","html":"
See Example 1 (paragraphs
920-350-55-1 through 55-7
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","snippet":"See Example 1 (paragraphs 920-350-55-1 through 55-7) for an Example illustrating the accounting for a license agreement for television program material in accordance with this Topic.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:21a9b3748dc97881c4dca37bf44cd0dc27340d55266c359ff7cf77301378c8b9","downloaded_from":"2026-09-10T00:16:57.671Z","last_downloaded_at":"2026-09-10T00:16:57.671Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477444","source_sha256":"6f31e3944185f123c1078fd8dabea59cb53357f53c906f2f0a0f2dd301747089"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:fa129da940f571b646282ffad17b52b6533f493b8ca8d6cbc2cce88c78ce05b8","downloaded_from":"2026-09-10T00:16:57.671Z","last_downloaded_at":"2026-09-10T00:16:57.671Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477444","source_sha256":"6f31e3944185f123c1078fd8dabea59cb53357f53c906f2f0a0f2dd301747089"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:0bac087fa65008cd6000cdb3974b991887b512d73653a436ab94e1690e4bcd27","downloaded_from":"2026-09-10T00:16:57.671Z","last_downloaded_at":"2026-09-10T00:16:57.671Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477444","source_sha256":"6f31e3944185f123c1078fd8dabea59cb53357f53c906f2f0a0f2dd301747089"}}],"enrichment":{"summary":"This Subtopic governs how broadcasters account for the liabilities they incur under license agreements for program material. A broadcaster recognizes both an asset (the program rights) and a liability when the license period begins and the conditions in 920-350-25-2 are met, measuring both at either the fair value or the gross amount of the liability, with any discount accreted as interest under Topic 835. The liability is then split between current and noncurrent on the balance sheet according to the payment terms.","key_points":["A broadcaster recognizes an asset and a liability for rights acquired and obligations incurred under a program license agreement when the license period begins and the conditions of 920-350-25-2 are met (405-920-25-1).","The licensee reports the asset and liability at either the fair value of the liability or the gross amount of the liability (405-920-30-1).","If a present value technique is used to measure fair value, the difference between the gross and net liability is accounted for as interest under Topic 835 (405-920-30-1).","The recorded liability must be segregated between current and noncurrent based on the payment terms of the license agreement (405-920-45-1).","The Subtopic uses the same scope as the Overall Broadcasters Subtopic, Section 920-10-15 (405-920-15-1).","Example 1 at 920-350-55-1 through 55-7 illustrates the accounting for a television program license agreement (405-920-55-1)."],"categories":["Recognition","Initial measurement","Presentation","Industry-specific"],"audience_level":"intermediate","student_note":"This is a rare instance where GAAP permits a policy choice between gross and fair (discounted) value for a liability — students often wrongly assume discounting is mandatory. Remember recognition is triggered by the start of the license period, not by contract signing or payment.","related_topics":["920-350","920-10","835","405-10","920-405"],"key_concepts":["broadcast license agreement","program material rights","license period","gross versus present value measurement","imputed interest","current and noncurrent classification","broadcaster liabilities"],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:906551a30d792a430cb6d04bae784779ce75cb23c31d0e69bd9297d529f49444","downloaded_from":"2026-09-10T00:16:39.447Z","last_downloaded_at":"2026-09-10T00:17:01.205Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval 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by retrieval timestamps"}},"next":{"number":"405-924","title":"Entertainment—Casinos","topic_title":"Liabilities","provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:e60061b768cac2d43276c97add7b70e836055ec7771d0fd8fa343fb3b96f36c7","downloaded_from":"2026-09-10T00:17:03.163Z","last_downloaded_at":"2026-09-10T00:17:19.253Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8055befa6be1eb03d8eefd501299e5532e4db8d375dff936e38446c6c5e7e5c2","downloaded_from":"2026-09-10T00:16:39.447Z","last_downloaded_at":"2026-09-10T00:17:01.205Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"405-924","topic":"405","title":"Entertainment—Casinos","area":"Liabilities","paragraphs":8,"summary":"This Subtopic governs two casino-specific liabilities: outstanding gaming chips and jackpot obligations. A casino recognizes a chip liability equal to the difference between chips placed in service and chips in its own custody/control, adjusted periodically for chips that will never be redeemed. Jackpot liabilities are accrued only when the casino has an obligation to pay — base jackpots that can be avoided (e.g., by pulling the machine) are not accrued, while the customer-funded incremental portion of a progressive jackpot is accrued as play occurs.","concepts":["gaming chip liability","chips placed in service","unredeemed chips","base jackpot","progressive jackpot","obligation to pay","customer-funded jackpot increment","breakage estimate"],"categories":["Recognition","Subsequent measurement","Industry-specific","Contingencies and guarantees"],"level":"intermediate","topic_title":"Liabilities","sections":[{"number":"00","label":"00 Status","anchor":"00-status","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-924-00-1","para":"00-1","html":"
The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
Base JackpotAddedAccounting Standards Update No. 2014-0905/28/2014
Slot MachineAddedAccounting Standards Update No. 2014-0905/28/2014
924-405-05-1AmendedAccounting Standards Update No. 2014-0905/28/2014
924-405-25-2AddedAccounting Standards Update No. 2014-0905/28/2014
924-405-55-1AddedAccounting Standards Update No. 2014-0905/28/2014
924-405-55-2AddedAccounting Standards Update No. 2014-0905/28/2014
","snippet":"The following table identifies the changes made to this Subtopic.\nParagraph | Action | Accounting Standards Update | Date |\n| | | |\nBase Jackpot | Added | Accounting Standards Update No. 2014-09 | 05/28/2014 |\nSlot Machi…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:fa2f137fa0355415046ef14c0bab4b85c67488388499ea6e13dbd67f759a5e4d","downloaded_from":"2026-09-10T00:17:03.163Z","last_downloaded_at":"2026-09-10T00:17:03.163Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478513","source_sha256":"c50ea6cac07f86e43add55a7aff44fcf8d7b1047aa9077dac588c4b551b7fc25"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f798b319e7e6f7817519af49458b7c871c8e16adc4f67bf657d2ae44ef285bf5","downloaded_from":"2026-09-10T00:17:03.163Z","last_downloaded_at":"2026-09-10T00:17:03.163Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478513","source_sha256":"c50ea6cac07f86e43add55a7aff44fcf8d7b1047aa9077dac588c4b551b7fc25"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:d3d4abab19ad0fdc633383fa5e9ca6e427b78338bec79ffff5572619663d0ec5","downloaded_from":"2026-09-10T00:17:03.163Z","last_downloaded_at":"2026-09-10T00:17:03.163Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478513","source_sha256":"c50ea6cac07f86e43add55a7aff44fcf8d7b1047aa9077dac588c4b551b7fc25"}},{"number":"05","label":"05 Overview and Background","anchor":"05-overview-and-background","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-924-05-1","para":"05-1","html":"
This Subtopic addresses the following:
  1. a
    The accounting for gaming chips held in inventory by casino entities and for gaming chips distributed to casino customers.
  2. b
    The accounting for jackpot liabilities.
","snippet":"This Subtopic addresses the following:\n(a) The accounting for gaming chips held in inventory by casino entities and for gaming chips distributed to casino customers.\n(b) The accounting for jackpot liabilities.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:e95bb76881cebb89a90154a6e8f309c7af362d79ba6a62e8b39c2ce276de0158","downloaded_from":"2026-09-10T00:17:07.155Z","last_downloaded_at":"2026-09-10T00:17:07.155Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477917","source_sha256":"54ceb987ffd7a331200035460d3c4f970129fc6da1edc35df7990988bfaa0f8f"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:006767816c6240d43e4161ec67fb27f2142a4ac969470226c333c15db4e56a33","downloaded_from":"2026-09-10T00:17:07.155Z","last_downloaded_at":"2026-09-10T00:17:07.155Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477917","source_sha256":"54ceb987ffd7a331200035460d3c4f970129fc6da1edc35df7990988bfaa0f8f"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:4a71a193e27cea936ec7516ea6ec5f24c68f4b200ca28ecd44c0dfbf49665026","downloaded_from":"2026-09-10T00:17:07.155Z","last_downloaded_at":"2026-09-10T00:17:07.155Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477917","source_sha256":"54ceb987ffd7a331200035460d3c4f970129fc6da1edc35df7990988bfaa0f8f"}},{"number":"15","label":"15 Scope and Scope Exceptions","anchor":"15-scope-and-scope-exceptions","is_sec":false,"groups":[{"block":null,"heading":"Overall Guidance","paragraphs":[{"citation":"405-924-15-1","para":"15-1","html":"
This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 924-10-15.
","snippet":"This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 924-10-15.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:2bf161adf6df887c65f9c8a38ce567005da0d5d8b10c90f5688445d943367280","downloaded_from":"2026-09-10T00:17:10.978Z","last_downloaded_at":"2026-09-10T00:17:10.978Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477302","source_sha256":"809b96276e4c43640427a7e85e0a37d826d49266ee50a10fa1ac1716fa21c03d"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:329851330a14b6eae45535f83911d5882757279d3bf426c9d1d3c53aa0702939","downloaded_from":"2026-09-10T00:17:10.978Z","last_downloaded_at":"2026-09-10T00:17:10.978Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477302","source_sha256":"809b96276e4c43640427a7e85e0a37d826d49266ee50a10fa1ac1716fa21c03d"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:e0b927bf3c44a2b971500066db3ac3b0b11efd72e7bb3b3b32399bfb35ab7b2e","downloaded_from":"2026-09-10T00:17:10.978Z","last_downloaded_at":"2026-09-10T00:17:10.978Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477302","source_sha256":"809b96276e4c43640427a7e85e0a37d826d49266ee50a10fa1ac1716fa21c03d"}},{"number":"25","label":"25 Recognition","anchor":"25-recognition","is_sec":false,"groups":[{"block":null,"heading":"Gaming Chips","paragraphs":[{"citation":"405-924-25-1","para":"25-1","html":"
Gaming chips are accounted for from the time the casino receives them even though the casino may not issue them immediately, but, instead, hold them in reserve. When a customer exchanges cash for gaming chips, the casino has a liability as long as those chips are not redeemed or won by the house. That liability is established by determining the difference between the total chips placed in service and the actual inventory of chips in custody or under the control of the casino.
","snippet":"Gaming chips are accounted for from the time the casino receives them even though the casino may not issue them immediately, but, instead, hold them in reserve. When a customer exchanges cash for gaming chips, the casino…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:0d914ca3341b2fa12e68c5d6370c4af9f500aafa5a878e722ca85d844ef2525d","downloaded_from":"2026-09-10T00:17:15.787Z","last_downloaded_at":"2026-09-10T00:17:15.787Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478434","source_sha256":"e1a22e11c518ea2c0e2836b3b8776b197c5e4814d4772817cf67264dddd57e34"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:88ec2335878c7fec7722eb4c04a615487bfc7e77f5b92584990347d62b856769","downloaded_from":"2026-09-10T00:17:15.787Z","last_downloaded_at":"2026-09-10T00:17:15.787Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478434","source_sha256":"e1a22e11c518ea2c0e2836b3b8776b197c5e4814d4772817cf67264dddd57e34"}},{"block":null,"heading":"Jackpot Liabilities","paragraphs":[{"citation":"405-924-25-2","para":"25-2","html":"
An entity shall accrue a liability at the time the entity has the obligation to pay the jackpot (or a portion thereof as applicable), regardless of the manner of payment. See paragraphs
924-405-55-1 through 55-2
for implementation guidance.
","snippet":"An entity shall accrue a liability at the time the entity has the obligation to pay the jackpot (or a portion thereof as applicable), regardless of the manner of payment. See paragraphs 924-405-55-1 through 55-2 for impl…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:5bc96e822ac5a2cb3ea0637c3283d09ce6da5e03fe957fb2e2840caa89dd8baf","downloaded_from":"2026-09-10T00:17:15.787Z","last_downloaded_at":"2026-09-10T00:17:15.787Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478434","source_sha256":"e1a22e11c518ea2c0e2836b3b8776b197c5e4814d4772817cf67264dddd57e34"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:491eae9d6a67c612fdbb75af4d9e3d18f738bb05c2e039a319e3be91d37ed076","downloaded_from":"2026-09-10T00:17:15.787Z","last_downloaded_at":"2026-09-10T00:17:15.787Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478434","source_sha256":"e1a22e11c518ea2c0e2836b3b8776b197c5e4814d4772817cf67264dddd57e34"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:a4846cbdfc815939bb1852067bac1adf3fb3dd6ecd74a47632234afe31effdd9","downloaded_from":"2026-09-10T00:17:15.787Z","last_downloaded_at":"2026-09-10T00:17:15.787Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478434","source_sha256":"e1a22e11c518ea2c0e2836b3b8776b197c5e4814d4772817cf67264dddd57e34"}},{"number":"35","label":"35 Subsequent Measurement","anchor":"35-subsequent-measurement","is_sec":false,"groups":[{"block":null,"heading":"Unredeemable Gaming Chips","paragraphs":[{"citation":"405-924-35-1","para":"35-1","html":"
The chip liability shall be adjusted periodically to reflect an estimate of chips that will never be redeemed (for example, chips that have been lost, taken as souvenirs, and so on).
","snippet":"The chip liability shall be adjusted periodically to reflect an estimate of chips that will never be redeemed (for example, chips that have been lost, taken as souvenirs, and so on).","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:a1d72e0b1afa223bbe1798ec33452d0c876051f87767d5eb456acea14018a56c","downloaded_from":"2026-09-10T00:17:17.599Z","last_downloaded_at":"2026-09-10T00:17:17.599Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478368","source_sha256":"f4ca4c8666f7a438ddf128927f4d45fdf43ecfc909f89791c453275b7c45106b"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:cfaaf8088a10c79e4ff55510b57827113ed7dbaee70e3aa02bb105dc8c4ff679","downloaded_from":"2026-09-10T00:17:17.599Z","last_downloaded_at":"2026-09-10T00:17:17.599Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478368","source_sha256":"f4ca4c8666f7a438ddf128927f4d45fdf43ecfc909f89791c453275b7c45106b"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:9d761d0f852b8961e07598c8a1f8bb1ae8f45c260f1c8076c45f8f463600a3e7","downloaded_from":"2026-09-10T00:17:17.599Z","last_downloaded_at":"2026-09-10T00:17:17.599Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478368","source_sha256":"f4ca4c8666f7a438ddf128927f4d45fdf43ecfc909f89791c453275b7c45106b"}},{"number":"55","label":"55 Implementation Guidance and Illustrations","anchor":"55-implementation-guidance-and-illustrations","is_sec":false,"groups":[{"block":null,"heading":"Implementation Guidance","paragraphs":[{"citation":"405-924-55-1","para":"55-1","html":"
The implementation guidance in this paragraph and the following paragraph addresses the application of paragraph 924-405-25-2. Some slot machines or other games may contain base jackpots. Depending on the applicable gaming regulations, an entity may be able to avoid the payment of a base jackpot, for example, by removing the machine from play. In accordance with the guidance in paragraph 924-405-25-2, no liability associated with the base jackpot is recognized in such cases until the entity has the obligation to pay the base jackpot. That is the case even if the entity has no intention of removing the machine from play and expects the base jackpot to ultimately be won.
","snippet":"The implementation guidance in this paragraph and the following paragraph addresses the application of paragraph 924-405-25-2. Some slot machines or other games may contain base jackpots. Depending on the applicable gami…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:4324365b1585eb47208e1456ab8330689a07adbfe927cb2af42ca6589c4eca51","downloaded_from":"2026-09-10T00:17:19.253Z","last_downloaded_at":"2026-09-10T00:17:19.253Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477706","source_sha256":"c143ea043c0539cd9ee2feb7db0afc92e5342bb2c94c6e26d2fdd0509a36b55d"}},{"citation":"405-924-55-2","para":"55-2","html":"
This implementation guidance addresses the application of paragraph 924-405-25-2. Some slot machines or other gaming machines include progressive jackpots. Entities in many gaming jurisdictions cannot avoid payment of the portion of the progressive jackpot that is incremental to the base jackpot because the gaming regulators consider the incremental portion of the jackpot to be funded by customers and required to be paid out (whether as a jackpot or through other means, such as a raffle). Paragraph 924-405-25-2 requires that, in such cases, the incremental portion of the jackpot be accrued as a liability at the time of funding (play) by its customers.
","snippet":"This implementation guidance addresses the application of paragraph 924-405-25-2. Some slot machines or other gaming machines include progressive jackpots. Entities in many gaming jurisdictions cannot avoid payment of th…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:6f26a4982221d9d615fff483191667701f035ac47fe5a6c03a4d2bfcfbfd8e0a","downloaded_from":"2026-09-10T00:17:19.253Z","last_downloaded_at":"2026-09-10T00:17:19.253Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477706","source_sha256":"c143ea043c0539cd9ee2feb7db0afc92e5342bb2c94c6e26d2fdd0509a36b55d"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:b0dbbd907b5624e7001660709ddbaf1d2350f4f5b97fd2302ae856c522af9a95","downloaded_from":"2026-09-10T00:17:19.253Z","last_downloaded_at":"2026-09-10T00:17:19.253Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477706","source_sha256":"c143ea043c0539cd9ee2feb7db0afc92e5342bb2c94c6e26d2fdd0509a36b55d"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:06de499b6c712b1cd07c9fc34bcde9662bac1175c4dc88358a672a433d62251e","downloaded_from":"2026-09-10T00:17:19.253Z","last_downloaded_at":"2026-09-10T00:17:19.253Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477706","source_sha256":"c143ea043c0539cd9ee2feb7db0afc92e5342bb2c94c6e26d2fdd0509a36b55d"}}],"enrichment":{"summary":"This Subtopic governs two casino-specific liabilities: outstanding gaming chips and jackpot obligations. A casino recognizes a chip liability equal to the difference between chips placed in service and chips in its own custody/control, adjusted periodically for chips that will never be redeemed. Jackpot liabilities are accrued only when the casino has an obligation to pay — base jackpots that can be avoided (e.g., by pulling the machine) are not accrued, while the customer-funded incremental portion of a progressive jackpot is accrued as play occurs.","key_points":["Gaming chips are accounted for from the time the casino receives them, even if held in reserve rather than issued immediately (405-924-25-1).","When a customer exchanges cash for chips, the casino has a liability until the chips are redeemed or won by the house; the liability equals chips placed in service less the chip inventory in the casino's custody or control (405-924-25-1).","The chip liability shall be adjusted periodically to estimate chips that will never be redeemed, such as chips lost or kept as souvenirs (405-924-35-1).","A liability for a jackpot is accrued at the time the entity has the obligation to pay it (or the applicable portion), regardless of the manner of payment (405-924-25-2).","No liability is recognized for a base jackpot the entity can avoid paying (for example, by removing the machine from play), even if it has no intention of removing the machine and expects the jackpot to be won (405-924-55-1).","Where regulators treat the incremental portion of a progressive jackpot as customer-funded and require payout, that incremental portion is accrued as a liability at the time of funding (play) by customers (405-924-55-2).","Scope follows the Overall Casinos Subtopic, Section 924-10-15 (405-924-15-1)."],"categories":["Recognition","Subsequent measurement","Industry-specific","Contingencies and guarantees"],"audience_level":"intermediate","student_note":"The tested distinction is base vs. progressive jackpots: an avoidable base jackpot creates no liability no matter how likely a payout is, while the customer-funded incremental progressive amount accrues with play. Students often wrongly assume expected payment alone triggers accrual — the trigger is a present obligation the casino cannot avoid.","related_topics":["924-10","924-405","405-20","450-20","606-10"],"key_concepts":["gaming chip liability","chips placed in service","unredeemed chips","base jackpot","progressive jackpot","obligation to pay","customer-funded jackpot increment","breakage estimate"],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:20fafcfe52cbdfb114154f415ce4ba4b0c4e09d9c2858f1e84161b59bd5e1176","downloaded_from":"2026-09-10T00:17:03.163Z","last_downloaded_at":"2026-09-10T00:17:19.253Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},"related":[{"number":"740-924","title":"Entertainment—Casinos","topic_title":"Income Taxes","score":0.6928,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:6ad246ede2513ac7543a56ffd43bde9036ee047df88a5df363df8dbd3d3cb2c0","downloaded_from":"2026-09-10T01:19:35.937Z","last_downloaded_at":"2026-09-10T01:19:46.163Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"405-980","title":"Regulated Operations","topic_title":"Liabilities","score":0.6888,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:aa755d6cfd2b33bf853ce9539b259d53744bdf24a372c0a08660bbbb32dd73ee","downloaded_from":"2026-09-10T00:20:12.403Z","last_downloaded_at":"2026-09-10T00:20:28.784Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"815-924","title":"Entertainment—Casinos","topic_title":"Derivatives and Hedging","score":0.6696,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:41e9443aa4071b17b724df32d31f6690d1f7aa55aab0d236e4102ec8900ff194","downloaded_from":"2026-09-10T01:39:58.369Z","last_downloaded_at":"2026-09-10T01:40:04.850Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"605-924","title":"Entertainment—Casinos","topic_title":"Revenue Recognition","score":0.6611,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:d383e674649685954b115c5c5b937f349b3068f4e0b9f44586bd1f46396b8111","downloaded_from":"2026-09-10T00:47:28.279Z","last_downloaded_at":"2026-09-10T00:47:49.424Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"450-20","title":"Loss Contingencies","topic_title":"Contingencies","score":0.6554,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8d1ff39f076b551ff436984423ba875a10104a9037d364c370e1ecb019338341","downloaded_from":"2026-09-10T00:27:01.778Z","last_downloaded_at":"2026-09-10T00:27:44.704Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"405-944","title":"Financial Services—Insurance","topic_title":"Liabilities","score":0.6525,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:b9ef3bc1f369212b2e3187d92966bd7e5df0a0f7b29a3841dedf699585f89bf8","downloaded_from":"2026-09-10T00:18:57.648Z","last_downloaded_at":"2026-09-10T00:19:09.841Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}}],"prev":{"number":"405-920","title":"Entertainment—Broadcasters","topic_title":"Liabilities","provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:66ca80100cdc0aa47fb72549ceb62cdba5fb73360cedec0fb129f3094c75c284","downloaded_from":"2026-09-10T00:16:39.447Z","last_downloaded_at":"2026-09-10T00:17:01.205Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},"next":{"number":"405-926","title":"Entertainment—Films","topic_title":"Liabilities","provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:031a5b073b52d7872bf1ea405536f86e7e7bc3ff6737eeb5a0ae6c66acf2c1c4","downloaded_from":"2026-09-10T00:17:22.936Z","last_downloaded_at":"2026-09-10T00:17:44.605Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:2469fa574a4e223bbe7caffdcdda69ae56a8c36c6bd3600c61c0cd6b3c848cbb","downloaded_from":"2026-09-10T00:17:03.163Z","last_downloaded_at":"2026-09-10T00:17:19.253Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"405-926","topic":"405","title":"Entertainment—Films","area":"Liabilities","paragraphs":19,"summary":"ASC 405-926 governs how film production and distribution entities accrue participation costs — amounts owed to third parties such as actors and writers — and costs of insignificant post-release changes to a film. Participation costs are accrued using the individual-film-forecast-computation method (current period actual revenue over estimated remaining unrecognized ultimate revenue at the beginning of the fiscal year), but only when it is probable an entity will sacrifice assets to settle the obligation, and never for less than amounts currently payable. If the recorded participation liability exceeds estimated unpaid ultimate participation costs, the excess reduces unamortized film costs first, then goes to income.","concepts":["participation costs","individual-film-forecast-computation method","ultimate revenue","unamortized film costs","probable sacrifice of assets","film cost amortization","insignificant changes to a film","accrued participation liability"],"categories":["Recognition","Subsequent measurement","Disclosure","Industry-specific"],"level":"intermediate","topic_title":"Liabilities","sections":[{"number":"00","label":"00 Status","anchor":"00-status","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-926-00-1","para":"00-1","html":"
The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
RevenueSupersededAccounting Standards Update No. 2014-0905/28/2014
Significant ChangesSupersededAccounting Standards Update No. 2019-0203/06/2019
Significant Changes to a FilmAddedAccounting Standards Update No. 2019-0203/06/2019
926-405-25-1AmendedAccounting Standards Update No. 2014-0905/28/2014
926-405-55-2AmendedAccounting Standards Update No. 2014-0905/28/2014
926-405-55-3AmendedAccounting Standards Update No. 2014-0905/28/2014
926-405-55-5AmendedAccounting Standards Update No. 2014-0905/28/2014
926-405-55-6AmendedAccounting Standards Update No. 2014-0905/28/2014
","snippet":"The following table identifies the changes made to this Subtopic.\nParagraph | Action | Accounting Standards Update | Date |\n| | | |\nRevenue | Superseded | Accounting Standards Update No. 2014-09 | 05/28/2014 |\nSignifican…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8d8d88682e70b13a9d02d978721b1f313d8a9378cc3e8fab534efd06de9cdd8c","downloaded_from":"2026-09-10T00:17:22.936Z","last_downloaded_at":"2026-09-10T00:17:22.936Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478752","source_sha256":"dd91dd534b810cd84644515bc4352d20e88205446b78b80e8658e57dfd213788"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:41985663e4f7a8b62f371c166110e05851f611d5ee656101bb034ab28a9046b0","downloaded_from":"2026-09-10T00:17:22.936Z","last_downloaded_at":"2026-09-10T00:17:22.936Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478752","source_sha256":"dd91dd534b810cd84644515bc4352d20e88205446b78b80e8658e57dfd213788"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:ebfc208af5cad6bde09080d689f3b18efe5ce83fb6103af78229ac1772f8c670","downloaded_from":"2026-09-10T00:17:22.936Z","last_downloaded_at":"2026-09-10T00:17:22.936Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478752","source_sha256":"dd91dd534b810cd84644515bc4352d20e88205446b78b80e8658e57dfd213788"}},{"number":"05","label":"05 Overview and Background","anchor":"05-overview-and-background","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-926-05-1","para":"05-1","html":"
This Subtopic provides guidance to entities in the film production and distribution industry on the accounting for costs incurred to compensate third parties involved in the production of a film, such as actors or writers. These costs are referred to as participation costs. This Subtopic also addresses the accounting for costs incurred to make insignificant changes to a film after its initial availability to a customer.
","snippet":"This Subtopic provides guidance to entities in the film production and distribution industry on the accounting for costs incurred to compensate third parties involved in the production of a film, such as actors or writer…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:b244f4d466152a8d36cd3706af30d2c5a074277dae24e7b17d708f1f2da798d6","downloaded_from":"2026-09-10T00:17:24.635Z","last_downloaded_at":"2026-09-10T00:17:24.635Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477724","source_sha256":"9a1668443afb668d61a5ce636bf7b9ff9ae3e394cd7f21ce78a6946e62c21fd0"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:0e25b16fc25d7ad531393fe2a6f9fcacdddbf8aec8037359477c363cc4a0db8f","downloaded_from":"2026-09-10T00:17:24.635Z","last_downloaded_at":"2026-09-10T00:17:24.635Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477724","source_sha256":"9a1668443afb668d61a5ce636bf7b9ff9ae3e394cd7f21ce78a6946e62c21fd0"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:2ebf58d12325c5c828886bac8727da0de9ea8c37039b856eecd76b65b09954f2","downloaded_from":"2026-09-10T00:17:24.635Z","last_downloaded_at":"2026-09-10T00:17:24.635Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477724","source_sha256":"9a1668443afb668d61a5ce636bf7b9ff9ae3e394cd7f21ce78a6946e62c21fd0"}},{"number":"15","label":"15 Scope and Scope Exceptions","anchor":"15-scope-and-scope-exceptions","is_sec":false,"groups":[{"block":null,"heading":"Overall Guidance","paragraphs":[{"citation":"405-926-15-1","para":"15-1","html":"
This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 926-10-15.
","snippet":"This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 926-10-15.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:281ca0df37c779196df12c1f3674a55f32d614397d43e09ad55eb2f0d1279e87","downloaded_from":"2026-09-10T00:17:26.473Z","last_downloaded_at":"2026-09-10T00:17:26.473Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477200","source_sha256":"e2a249f1466f82ea1c404cf5d9a784d4d42ed1707cf3f926f7c344725ce9d0e1"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:ed672df010c2dbdad9e6b86e2f39b55477db9808c200e9505d679698ffef0cab","downloaded_from":"2026-09-10T00:17:26.473Z","last_downloaded_at":"2026-09-10T00:17:26.473Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477200","source_sha256":"e2a249f1466f82ea1c404cf5d9a784d4d42ed1707cf3f926f7c344725ce9d0e1"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:3af41b65a01dee94c09436021a4631b749aee9b0dfd014bbbdd8d704f0616505","downloaded_from":"2026-09-10T00:17:26.473Z","last_downloaded_at":"2026-09-10T00:17:26.473Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477200","source_sha256":"e2a249f1466f82ea1c404cf5d9a784d4d42ed1707cf3f926f7c344725ce9d0e1"}},{"number":"25","label":"25 Recognition","anchor":"25-recognition","is_sec":false,"groups":[{"block":null,"heading":"Participation Costs","paragraphs":[{"citation":"405-926-25-1","para":"25-1","html":"
An entity shall accrue (expense) participation costs using the individual-film-forecast-computation method, which accrues (expenses) such costs in the same ratio that current period actual revenue (numerator) bears to estimated remaining unrecognized ultimate revenue as of the beginning of the current fiscal year (denominator). That is, unaccrued (not yet expensed) ultimate participation costs at the beginning of the current fiscal year are multiplied by the individual-film-forecast-computation method fraction. In this way, in the absence of changes in estimates, participation costs are accrued (expensed) in a manner that yields a constant rate of profit over the ultimate period, as described in paragraph 926-20-35-5(a), for each film before exploitation costs, manufacturing costs, and other period expenses.
","snippet":"An entity shall accrue (expense) participation costs using the individual-film-forecast-computation method, which accrues (expenses) such costs in the same ratio that current period actual revenue (numerator) bears to es…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:3742a9327d036321493c7f7d93de07cf9fb7291e3d5d54435e6a4b4c8f0dbaf0","downloaded_from":"2026-09-10T00:17:32.820Z","last_downloaded_at":"2026-09-10T00:17:32.820Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477848","source_sha256":"c9cb94e62650a444c6763d733dd8b632a222b3d551dbfa57b37f593d9a089282"}},{"citation":"405-926-25-2","para":"25-2","html":"
An entity shall accrue a liability for participation costs only if it is probable that there will be a sacrifice of assets to settle its obligation under the terms of the participation agreement. At each balance sheet date, accrued participation costs shall not be less than the amounts that an entity is obligated to pay as of that date.
","snippet":"An entity shall accrue a liability for participation costs only if it is probable that there will be a sacrifice of assets to settle its obligation under the terms of the participation agreement. At each balance sheet da…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:1350d0e41facc782d5c434f798d20eebd9920f9dea11562b566c07336d16f178","downloaded_from":"2026-09-10T00:17:32.820Z","last_downloaded_at":"2026-09-10T00:17:32.820Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477848","source_sha256":"c9cb94e62650a444c6763d733dd8b632a222b3d551dbfa57b37f593d9a089282"}},{"citation":"405-926-25-3","para":"25-3","html":"
An entity shall begin accruing (expensing) participation costs when a film is released and it begins to recognize revenue from that film.
","snippet":"An entity shall begin accruing (expensing) participation costs when a film is released and it begins to recognize revenue from that film.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:b01c1d8dfe881285b6f0f6b1613d6d58e6f4b9f7e76fab43d19be70ba636c983","downloaded_from":"2026-09-10T00:17:32.820Z","last_downloaded_at":"2026-09-10T00:17:32.820Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477848","source_sha256":"c9cb94e62650a444c6763d733dd8b632a222b3d551dbfa57b37f593d9a089282"}},{"citation":"405-926-25-4","para":"25-4","html":"
Estimates of unaccrued (that is, not yet expensed) ultimate participation costs are used in the individual-film-forecast-computation method to arrive at current period participation cost expense. Such costs shall be determined using assumptions that are consistent with an entity's estimates of film costs, exploitation costs, and ultimate revenue, as limited by paragraphs 926-20-35-5 and 926-20-35-11.
","snippet":"Estimates of unaccrued (that is, not yet expensed) ultimate participation costs are used in the individual-film-forecast-computation method to arrive at current period participation cost expense. Such costs shall be dete…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:98b2c4ad44bc896635f738e89e9b4deeace98810004fbd0fbb773f9df402c63f","downloaded_from":"2026-09-10T00:17:32.820Z","last_downloaded_at":"2026-09-10T00:17:32.820Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477848","source_sha256":"c9cb94e62650a444c6763d733dd8b632a222b3d551dbfa57b37f593d9a089282"}},{"citation":"405-926-25-5","para":"25-5","html":"
A film may continue to generate revenue after its film costs are fully amortized. When revenue is recorded on fully amortized films, an entity shall accrue associated participation costs as that revenue is recognized.
","snippet":"A film may continue to generate revenue after its film costs are fully amortized. When revenue is recorded on fully amortized films, an entity shall accrue associated participation costs as that revenue is recognized.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:67d096f1032c46c08db969ab1ac6b493661e34566228e6095197a5650e4a0068","downloaded_from":"2026-09-10T00:17:32.820Z","last_downloaded_at":"2026-09-10T00:17:32.820Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477848","source_sha256":"c9cb94e62650a444c6763d733dd8b632a222b3d551dbfa57b37f593d9a089282"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:17f3c13a489da27af5c11d90eb8983d29851758ee7432827cd0242419b95f7f4","downloaded_from":"2026-09-10T00:17:32.820Z","last_downloaded_at":"2026-09-10T00:17:32.820Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477848","source_sha256":"c9cb94e62650a444c6763d733dd8b632a222b3d551dbfa57b37f593d9a089282"}},{"block":null,"heading":"Costs Incurred for Insignificant Changes to a Film","paragraphs":[{"citation":"405-926-25-6","para":"25-6","html":"
A licensing arrangement may require an entity to make changes to a film after its initial availability to a customer. Those changes may be deemed significant or not significant. Any costs expected to be incurred for changes that are not significant shall be accrued and charged to expense if an entity begins to recognize revenue from the arrangement before incurring those costs.
","snippet":"A licensing arrangement may require an entity to make changes to a film after its initial availability to a customer. Those changes may be deemed significant or not significant. Any costs expected to be incurred for chan…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:0c79cea9c8e6f8e6aea511f7432004cc78c375806a995d57be51f2ad2eced939","downloaded_from":"2026-09-10T00:17:32.820Z","last_downloaded_at":"2026-09-10T00:17:32.820Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477848","source_sha256":"c9cb94e62650a444c6763d733dd8b632a222b3d551dbfa57b37f593d9a089282"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:180453256ae22f11d0f7dca7ec66901a73745b859d625a8451e9fd040832dace","downloaded_from":"2026-09-10T00:17:32.820Z","last_downloaded_at":"2026-09-10T00:17:32.820Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477848","source_sha256":"c9cb94e62650a444c6763d733dd8b632a222b3d551dbfa57b37f593d9a089282"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:60828de462cdd6c68385e0d95365535509ca174b424ac38b2e6c4e4db8566a5b","downloaded_from":"2026-09-10T00:17:32.820Z","last_downloaded_at":"2026-09-10T00:17:32.820Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477848","source_sha256":"c9cb94e62650a444c6763d733dd8b632a222b3d551dbfa57b37f593d9a089282"}},{"number":"35","label":"35 Subsequent Measurement","anchor":"35-subsequent-measurement","is_sec":false,"groups":[{"block":null,"heading":"Ultimate Participation Costs","paragraphs":[{"citation":"405-926-35-1","para":"35-1","html":"
If, at any balance sheet date, the recognized participation costs liability exceeds the estimated unpaid ultimate participation costs for an individual film, the excess liability shall be reduced with an offsetting credit to unamortized film costs. To the extent that an excess liability exceeds unamortized film costs for that film, that excess liability shall be credited to income. For more information, see Example 1 (paragraph 926-405-55-1).
","snippet":"If, at any balance sheet date, the recognized participation costs liability exceeds the estimated unpaid ultimate participation costs for an individual film, the excess liability shall be reduced with an offsetting credi…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:3b77930425a8afb380de2ab052e440f6e0eb5372309249460226b88c9c9e6296","downloaded_from":"2026-09-10T00:17:35.142Z","last_downloaded_at":"2026-09-10T00:17:35.142Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478066","source_sha256":"4e3e3c1a64a3b0f9c08ccb48d85396376ffa621f42ef632b02871c794ebb43c2"}},{"citation":"405-926-35-2","para":"35-2","html":"
For the accounting of revised estimates of participation costs, see paragraph 926-20-35-3.
","snippet":"For the accounting of revised estimates of participation costs, see paragraph 926-20-35-3.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:e94773533a5ee7b55e512b4bafaab3b9f5b22e58b9e336abffec444a7936cad7","downloaded_from":"2026-09-10T00:17:35.142Z","last_downloaded_at":"2026-09-10T00:17:35.142Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478066","source_sha256":"4e3e3c1a64a3b0f9c08ccb48d85396376ffa621f42ef632b02871c794ebb43c2"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:0ff8c7d34e86ad8cf4a20be5c7784bf021018f5a2fc5a5ae9bfde2ce46aecf0d","downloaded_from":"2026-09-10T00:17:35.142Z","last_downloaded_at":"2026-09-10T00:17:35.142Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478066","source_sha256":"4e3e3c1a64a3b0f9c08ccb48d85396376ffa621f42ef632b02871c794ebb43c2"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:c0186a825a2bb287d0d6a88270ab351cab8dca6fee3f821cab601396b257bce9","downloaded_from":"2026-09-10T00:17:35.142Z","last_downloaded_at":"2026-09-10T00:17:35.142Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478066","source_sha256":"4e3e3c1a64a3b0f9c08ccb48d85396376ffa621f42ef632b02871c794ebb43c2"}},{"number":"50","label":"50 Disclosure","anchor":"50-disclosure","is_sec":false,"groups":[{"block":null,"heading":"Accrued Participation Liabilities","paragraphs":[{"citation":"405-926-50-1","para":"50-1","html":"
An entity shall disclose the amount of accrued participation liabilities that it expects to pay during the upcoming operating cycle.
","snippet":"An entity shall disclose the amount of accrued participation liabilities that it expects to pay during the upcoming operating cycle.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:ef88dba3cfd63ca041006bde39a5092297ca8500f0452ed8542ce1fb87b13d6b","downloaded_from":"2026-09-10T00:17:38.268Z","last_downloaded_at":"2026-09-10T00:17:38.268Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477694","source_sha256":"50c0b0c92c4198439710d3173d992260a66bc547c8b49a370f15f3883a85dc99"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f1dc45df4d6aa5e07544020752f72b84064c15abea5a63d6bc33cef7a80a3e22","downloaded_from":"2026-09-10T00:17:38.268Z","last_downloaded_at":"2026-09-10T00:17:38.268Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477694","source_sha256":"50c0b0c92c4198439710d3173d992260a66bc547c8b49a370f15f3883a85dc99"}},{"block":null,"heading":"Participation Costs","paragraphs":[{"citation":"405-926-50-2","para":"50-2","html":"
An entity shall disclose its methods of accounting for participation costs.
","snippet":"An entity shall disclose its methods of accounting for participation costs.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:9591818af84e6397b30c7c6b20615e6bbffd98dd7862447bb9b186230ca09efe","downloaded_from":"2026-09-10T00:17:38.268Z","last_downloaded_at":"2026-09-10T00:17:38.268Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477694","source_sha256":"50c0b0c92c4198439710d3173d992260a66bc547c8b49a370f15f3883a85dc99"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:67b9913abeb3176677edec62cdb052161ea53e1f1cf12ef137b85f6a9e886168","downloaded_from":"2026-09-10T00:17:38.268Z","last_downloaded_at":"2026-09-10T00:17:38.268Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477694","source_sha256":"50c0b0c92c4198439710d3173d992260a66bc547c8b49a370f15f3883a85dc99"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:def930361671081698638c01a471f04672641f2713ed5ecc3004015531e70b9b","downloaded_from":"2026-09-10T00:17:38.268Z","last_downloaded_at":"2026-09-10T00:17:38.268Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477694","source_sha256":"50c0b0c92c4198439710d3173d992260a66bc547c8b49a370f15f3883a85dc99"}},{"number":"55","label":"55 Implementation Guidance and Illustrations","anchor":"55-implementation-guidance-and-illustrations","is_sec":false,"groups":[{"block":null,"heading":"Illustrations","paragraphs":[{"citation":"405-926-55-1","para":"55-1","html":"
This Example illustrates the adjustment of a participation liability that is in excess of a revised estimate of amounts ultimately payable (in accordance with paragraph 926-405-35-1).
","snippet":"This Example illustrates the adjustment of a participation liability that is in excess of a revised estimate of amounts ultimately payable (in accordance with paragraph 926-405-35-1).","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:1e085d5cc7ac7d3b10cb8d725200cabc015fcfcecce1bae83a6e86cd8899822f","downloaded_from":"2026-09-10T00:17:41.616Z","last_downloaded_at":"2026-09-10T00:17:41.616Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478776","source_sha256":"42f0fd1a08fbaf0fb4a49d95ea190db44fa9679b6486d18609c0c272796b09aa"}},{"citation":"405-926-55-2","para":"55-2","html":"
In accordance with paragraph 926-405-35-1, a participation liability that exceeds the unpaid amount expected to be ultimately payable shall be offset against the remaining carrying value of the corresponding film. This scenario can result from changes in ultimate revenue and cost estimates that result in reduced expectations of ultimate participation costs.
","snippet":"In accordance with paragraph 926-405-35-1, a participation liability that exceeds the unpaid amount expected to be ultimately payable shall be offset against the remaining carrying value of the corresponding film. This s…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:1ac7eccb03b11c1907bdc6ce4cc768da5951ce893df0f58b8243861bb2ae13de","downloaded_from":"2026-09-10T00:17:41.616Z","last_downloaded_at":"2026-09-10T00:17:41.616Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478776","source_sha256":"42f0fd1a08fbaf0fb4a49d95ea190db44fa9679b6486d18609c0c272796b09aa"}},{"citation":"405-926-55-3","para":"55-3","html":"
Assume the following:
  1. a
    Film cost: $50,000
  2. b
    Estimated ultimate revenue:
    1. 1
      Year 1: $100,000
    2. 2
      Year 2: $80,000.
  3. c
    Actual revenue recognized:
    1. 1
      In Year 1: $60,000
    2. 2
      In Year 2: $10,000.
  4. d
    Estimated ultimate participation costs:
    1. 1
      Year 1: $10,000
    2. 2
      Year 2: $0.
  5. e
    For Year 1, film cost amortization was $30,000, and participation costs accrued were $6,000.
","snippet":"Assume the following:\n(a) Film cost: $50,000\n(b) Estimated ultimate revenue:\n(1) Year 1: $100,000\n(2) Year 2: $80,000.\n(c) Actual revenue recognized:\n(1) In Year 1: $60,000\n(2) In Year 2: $10,000.\n(d) Estimated ultimate …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8b7c471de282594ccd3efe3453caad75918ad4a639cfbb72ed5f3738bc8afbf1","downloaded_from":"2026-09-10T00:17:41.616Z","last_downloaded_at":"2026-09-10T00:17:41.616Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478776","source_sha256":"42f0fd1a08fbaf0fb4a49d95ea190db44fa9679b6486d18609c0c272796b09aa"}},{"citation":"405-926-55-4","para":"55-4","html":"
Adjustments of Participation Liability and Film Costs in Year 2.
","snippet":"Adjustments of Participation Liability and Film Costs in Year 2.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:a4f626f07110ee3a07b5a1ac51cfae96b3da6e52fe9a5978833215d42a8e7f8a","downloaded_from":"2026-09-10T00:17:41.616Z","last_downloaded_at":"2026-09-10T00:17:41.616Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478776","source_sha256":"42f0fd1a08fbaf0fb4a49d95ea190db44fa9679b6486d18609c0c272796b09aa"}},{"citation":"405-926-55-5","para":"55-5","html":"
Film cost amortization in Year 2:
","snippet":"Film cost amortization in Year 2:\n$10,000 recognized revenue/$20,000 remaining ultimate revenue x $14,000 unamortized film costs = $7,000\nThe $20,000 remaining ultimate revenue is computed as follows: Year 2 revised ulti…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:643795c0ac195a76d8a1cf96470110f95aa421defaf7e8318964a58bb3401a8e","downloaded_from":"2026-09-10T00:17:41.616Z","last_downloaded_at":"2026-09-10T00:17:41.616Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478776","source_sha256":"42f0fd1a08fbaf0fb4a49d95ea190db44fa9679b6486d18609c0c272796b09aa"}},{"citation":"405-926-55-6","para":"55-6","html":"
Participation costs accrued in Year 2:
","snippet":"Participation costs accrued in Year 2:\n$10,000 recognized revenue/$20,000 remaining ultimate revenue x $0 remaining ultimate participation costs = $0\nThe $20,000 remaining ultimate revenue is computed as follows: Year 2 …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:6b314be987226642014239525d0e1e90618f6aab23a20cf7a1a6c74f49182ed3","downloaded_from":"2026-09-10T00:17:41.616Z","last_downloaded_at":"2026-09-10T00:17:41.616Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478776","source_sha256":"42f0fd1a08fbaf0fb4a49d95ea190db44fa9679b6486d18609c0c272796b09aa"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:af020fca95158086d744c07791d4695453bc1f19892f59730a4592211572f00b","downloaded_from":"2026-09-10T00:17:41.616Z","last_downloaded_at":"2026-09-10T00:17:41.616Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478776","source_sha256":"42f0fd1a08fbaf0fb4a49d95ea190db44fa9679b6486d18609c0c272796b09aa"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:1c6f88fbf1510b548791908cc011b169293ed42db2147dee146c38641bd16d86","downloaded_from":"2026-09-10T00:17:41.616Z","last_downloaded_at":"2026-09-10T00:17:41.616Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478776","source_sha256":"42f0fd1a08fbaf0fb4a49d95ea190db44fa9679b6486d18609c0c272796b09aa"}}],"enrichment":{"summary":"ASC 405-926 governs how film production and distribution entities accrue participation costs — amounts owed to third parties such as actors and writers — and costs of insignificant post-release changes to a film. Participation costs are accrued using the individual-film-forecast-computation method (current period actual revenue over estimated remaining unrecognized ultimate revenue at the beginning of the fiscal year), but only when it is probable an entity will sacrifice assets to settle the obligation, and never for less than amounts currently payable. If the recorded participation liability exceeds estimated unpaid ultimate participation costs, the excess reduces unamortized film costs first, then goes to income.","key_points":["Participation costs are accrued using the individual-film-forecast-computation method, applying the fraction of current period actual revenue over estimated remaining unrecognized ultimate revenue as of the beginning of the fiscal year to unaccrued ultimate participation costs (405-926-25-1).","A participation liability is accrued only if it is probable there will be a sacrifice of assets to settle the obligation, and accrued participation costs at each balance sheet date shall not be less than amounts the entity is obligated to pay as of that date (405-926-25-2).","Accrual begins when the film is released and the entity begins recognizing revenue from that film, and continues on fully amortized films as revenue is recognized (405-926-25-3; 405-926-25-5).","Estimates of unaccrued ultimate participation costs must use assumptions consistent with the entity's estimates of film costs, exploitation costs, and ultimate revenue, as limited by 926-20-35-5 and 926-20-35-11 (405-926-25-4).","Costs expected for changes to a film that are not significant under a licensing arrangement are accrued and charged to expense if revenue recognition begins before the costs are incurred (405-926-25-6).","Any recognized participation liability in excess of estimated unpaid ultimate participation costs is reduced with an offsetting credit to unamortized film costs, and only the remainder beyond unamortized film costs is credited to income (405-926-35-1; Example 1 at 926-405-55-1).","Disclose the amount of accrued participation liabilities expected to be paid during the upcoming operating cycle and the methods of accounting for participation costs (405-926-50-1; 405-926-50-2)."],"categories":["Recognition","Subsequent measurement","Disclosure","Industry-specific"],"audience_level":"intermediate","student_note":"The classic trap is treating participation costs as ratably expensed or as payable-based; instead they follow the same revenue-based forecast ratio as film cost amortization, floored at amounts currently due. Also remember the excess-liability reversal cascades to unamortized film costs first — income only after film costs are exhausted.","related_topics":["926-20","926-10","926-405","450-20","606"],"key_concepts":["participation costs","individual-film-forecast-computation method","ultimate revenue","unamortized film costs","probable sacrifice of assets","film cost amortization","insignificant changes to a film","accrued participation liability"],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:3b20e4f4ffc566f6e8ee737533a8bace0715325e455a605fb23befa5c53c7bcf","downloaded_from":"2026-09-10T00:17:22.936Z","last_downloaded_at":"2026-09-10T00:17:44.605Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},"related":[{"number":"926-20","title":"Other Assets—Film 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timestamps"}},{"number":"405-928","topic":"405","title":"Entertainment—Music","area":"Liabilities","paragraphs":3,"summary":"This subtopic tells a music licensee how to account for fees owed under a license agreement with the owner/licensor of a record master or music copyright that grants the right to sell or distribute records or music for a stipulated fee. Its single rule: license fees that are not fixed in amount before the agreement expires must be estimated and accrued, license by license.","concepts":["license agreement","record master","music copyright","licensee fees","accrual of estimated fees","license-by-license basis","record club free records"],"categories":["Recognition","Industry-specific","Subsequent measurement"],"level":"intermediate","topic_title":"Liabilities","sections":[{"number":"05","label":"05 Overview and Background","anchor":"05-overview-and-background","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-928-05-1","para":"05-1","html":"
A licensee entity may enter into a license agreement with an owner or licensor of a record master or music copyright granting the licensee the right to sell or distribute records or music for a stipulated fee. This Subtopic provides guidance for the accounting and reporting by the licensee of fees paid under such license arrangements.
","snippet":"A licensee entity may enter into a license agreement with an owner or licensor of a record master or music copyright granting the licensee the right to sell or distribute records or music for a stipulated fee. This Subto…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:6e04505ceff12fe72b057a0febea2fd194b78a2f8da8aa01f140950c77de54ef","downloaded_from":"2026-09-10T00:17:48.299Z","last_downloaded_at":"2026-09-10T00:17:48.299Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478957","source_sha256":"86ed3ac473452ce97b4dc440519c3089f7f25cddd578fe2c00059c9f0b458eec"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:96e2cc4fcdbeb67c99f2421341570532103707eb3d5d9f53823a6c83e3647a9c","downloaded_from":"2026-09-10T00:17:48.299Z","last_downloaded_at":"2026-09-10T00:17:48.299Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478957","source_sha256":"86ed3ac473452ce97b4dc440519c3089f7f25cddd578fe2c00059c9f0b458eec"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:1e001cbffbd8b91767d2782cad421de1393062a18b2f365db59f15e33c2addd6","downloaded_from":"2026-09-10T00:17:48.299Z","last_downloaded_at":"2026-09-10T00:17:48.299Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478957","source_sha256":"86ed3ac473452ce97b4dc440519c3089f7f25cddd578fe2c00059c9f0b458eec"}},{"number":"15","label":"15 Scope and Scope Exceptions","anchor":"15-scope-and-scope-exceptions","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-928-15-1","para":"15-1","html":"
This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 928-10-15.
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Any fees required by a licensing agreement (for example, for free records distributed by a record club in excess of a stipulated number) that are not fixed in amount prior to the expiration date of the agreement shall be estimated and accrued on a license-by-license basis by the licensee.
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Its single rule: license fees that are not fixed in amount before the agreement expires must be estimated and accrued, license by license.","key_points":["A licensee may obtain the right to sell or distribute records or music from the owner or licensor of a record master or music copyright for a stipulated fee, and this Subtopic governs the licensee's accounting and reporting for those fees (405-928-05-1).","Scope follows the Overall Subtopic scope in Section 928-10-15 (405-928-15-1).","Fees required by a licensing agreement that are not fixed in amount prior to the agreement's expiration date must be estimated and accrued by the licensee (405-928-25-1).","The estimate and accrual must be made on a license-by-license basis, not in the aggregate (405-928-25-1).","An example of such an unfixed fee is the amount owed for free records distributed by a record club in excess of a stipulated number (405-928-25-1)."],"categories":["Recognition","Industry-specific","Subsequent measurement"],"audience_level":"intermediate","student_note":"This is a one-rule industry subtopic: the licensee cannot wait for the fee to become fixed—unfixed license fees must be estimated and accrued as incurred. The common misunderstanding is aggregating estimates across licenses; the guidance requires a license-by-license computation.","related_topics":["928-10","928-340","928-405","450-20","926"],"key_concepts":["license agreement","record master","music copyright","licensee fees","accrual of estimated fees","license-by-license basis","record club free records"],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:2e54add5de867f81314e5356aa1e592f11ccf3344422581276a37bb0150902d3","downloaded_from":"2026-09-10T00:17:48.299Z","last_downloaded_at":"2026-09-10T00:17:59.597Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},"related":[{"number":"720-928","title":"Entertainment—Music","topic_title":"Other 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The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
Financial Asset (2nd def.)AmendedAccounting Standards Update No. 2016-1912/14/2016
Repurchase AgreementAmendedAccounting Standards Update No. 2014-1106/12/2014
Repurchase Agreement (1st def.)AddedAccounting Standards Update No. 2014-0603/14/2014
Repurchase Agreement (2nd def.)SupersededAccounting Standards Update No. 2014-0603/14/2014
940-405-45-1AmendedAccounting Standards Update No. 2014-0603/14/2014
940-405-55-1SupersededAccounting Standards Update No. 2018-0907/16/2018
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This Subtopic addresses liabilities for brokers and dealers in securities (broker-dealers), including stock-loan and repo transactions entered into for the purpose of financing investment positions (such as in lieu of a bank loan).
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This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 940-10-15.
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Stock-loan and repurchase transactions may be entered into for the purpose of financing positions (such as in lieu of a bank loan). Topic 860 provides general guidance on such transactions. If such transactions are accounted for as financing transactions, the rebate or interest expense shall be reflected in the income statement as an expense separate and apart from any trading gains or losses.
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Paragraph superseded by Accounting Standards Update No. 2018-09.
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Deposit liabilities are recognized when deposits are received (not when funds are collected), with deposit float recorded as both an asset and a liability, and credit unions must present member share/savings accounts unequivocally as liabilities. Short sales (\"securities sold, not yet purchased\") are reported as liabilities measured at fair value through income, with interest on short positions accrued as interest expense.","concepts":["deposit liabilities","deposit float","securities sold, not yet purchased","short sales","member share accounts","redeemable preferred stock of a subsidiary","uninsured time deposits","credit union presentation"],"categories":["Recognition","Presentation","Disclosure","Industry-specific"],"level":"intermediate","topic_title":"Liabilities","sections":[{"number":"00","label":"00 Status","anchor":"00-status","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-942-00-1","para":"00-1","html":"
The following table identifies the changes made to this Subtopic.
Paragraph Action Accounting Standards Update Date
942-405-50-1 Amended Maintenance Update 2018-02 (PDF) 02/02/2018
942-405-50-1 Amended Maintenance Update 2014-07 (PDF) 03/17/2014
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This Subtopic provides disclosure and implementation guidance for deposit liabilities by financial institutions.
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This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 942-10-15.
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The obligations incurred in short sales shall be reported as liabilities. Such liabilities are generally called securities sold, not yet purchased.
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See paragraph 815-10-55-57 for additional guidance concerning short sales.
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The institution's liability for deposits originates and shall be recognized at the time deposits are received rather than when the institution collects the funds. Checks that are deposited by customers and that are in the process of collection and are currently not available for withdrawal (deposit float) shall be recorded as assets and liabilities. Deposits shall not be recorded based solely on collections.
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Credit unions and corporate credit unions shall report unequivocally all member deposit accounts, including member shares, as liabilities in the statement of financial condition.
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The obligations incurred in short sales shall be subsequently measured at fair value through the income statement at each reporting date. Interest on the short positions shall be accrued periodically and reported as interest expense.
","snippet":"The obligations incurred in short sales shall be subsequently measured at fair value through the income statement at each reporting date. Interest on the short positions shall be accrued periodically and reported as inte…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:e76d4721fc7ffc3b9d7ee98501ca8a014a5029ce62362b9cf9ad761a2063d6e7","downloaded_from":"2026-09-10T00:18:42.712Z","last_downloaded_at":"2026-09-10T00:18:42.712Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478592","source_sha256":"0fa23bd8e59768462cdfd39a2aa3b44e3819e30317aad5a7f36253021dc77daf"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:7debfd0bc05701541a715d9b3500c222bf84d5263d1b3b18a5783e6016df26ef","downloaded_from":"2026-09-10T00:18:42.712Z","last_downloaded_at":"2026-09-10T00:18:42.712Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478592","source_sha256":"0fa23bd8e59768462cdfd39a2aa3b44e3819e30317aad5a7f36253021dc77daf"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:4ec2f820be2daf1f5bcc75599407033ab15f1f076a13cabc90d5eb9512893941","downloaded_from":"2026-09-10T00:18:42.712Z","last_downloaded_at":"2026-09-10T00:18:42.712Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478592","source_sha256":"0fa23bd8e59768462cdfd39a2aa3b44e3819e30317aad5a7f36253021dc77daf"}},{"number":"45","label":"45 Other Presentation Matters","anchor":"45-other-presentation-matters","is_sec":false,"groups":[{"block":null,"heading":"Short Sales of Securities","paragraphs":[{"citation":"405-942-45-1","para":"45-1","html":"
The fair value adjustment on short sales of securities shall be classified in the income statement with gains and losses on securities.
","snippet":"The fair value adjustment on short sales of securities shall be classified in the income statement with gains and losses on securities.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:2638a4b9a518b6fe95be6b549c5976f6f7a791509bacf2353a7baf056b59d883","downloaded_from":"2026-09-10T00:18:44.394Z","last_downloaded_at":"2026-09-10T00:18:44.394Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477787","source_sha256":"0fb2257cc38cd18a38c75824f27229b83aaf22d8df43c25a73bf83e7e52cf25d"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:491da17a8a55d8a511afdfbab707a58c2d45858f1b42e4e0fbdd29a36bfa1a27","downloaded_from":"2026-09-10T00:18:44.394Z","last_downloaded_at":"2026-09-10T00:18:44.394Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477787","source_sha256":"0fb2257cc38cd18a38c75824f27229b83aaf22d8df43c25a73bf83e7e52cf25d"}},{"block":null,"heading":"Redeemable Preferred Stock Dividends","paragraphs":[{"citation":"405-942-45-2","para":"45-2","html":"
For redeemable preferred stock of a subsidiary accounted for as a liability in a parent's consolidated financial statements, dividends shall be included in the determination of income as interest expense. For redeemable preferred stock of a subsidiary accounted for as a noncontrolling interest in a subsidiary in a parent's consolidated financial statements, the dividends shall be presented as noncontrolling interest in income of a subsidiary. For redeemable preferred stock of a parent treated as capital, but displayed in the balance sheet as mezzanine capital, dividends shall be included in the statement of changes in shareholders' equity.
","snippet":"For redeemable preferred stock of a subsidiary accounted for as a liability in a parent's consolidated financial statements, dividends shall be included in the determination of income as interest expense. For redeemable …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:0a241250fe6d71f733e30c438df20cf0a51a726fdfc82e277ddea3c43ecff65e","downloaded_from":"2026-09-10T00:18:44.394Z","last_downloaded_at":"2026-09-10T00:18:44.394Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477787","source_sha256":"0fb2257cc38cd18a38c75824f27229b83aaf22d8df43c25a73bf83e7e52cf25d"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:82d4b7c62cb3ac179b754ad89dbacacac2ed88d50d06351c7d3b1aa1ed59368d","downloaded_from":"2026-09-10T00:18:44.394Z","last_downloaded_at":"2026-09-10T00:18:44.394Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477787","source_sha256":"0fb2257cc38cd18a38c75824f27229b83aaf22d8df43c25a73bf83e7e52cf25d"}},{"block":null,"heading":"Member Deposits","paragraphs":[{"citation":"405-942-45-3","para":"45-3","html":"
The statement of financial condition of credit unions and corporate credit unions shall either:
  1. a
    Present deposit accounts as the first item in the liabilities and equity section
  2. b
    Include deposit accounts within a captioned subtotal for total liabilities.
An unclassified presentation whereby all liabilities and equity are shown together under one subheading and savings accounts are presented as the last item before retained earnings shall not be an acceptable presentation.
","snippet":"The statement of financial condition of credit unions and corporate credit unions shall either:\n(a) Present deposit accounts as the first item in the liabilities and equity section\n(b) Include deposit accounts within a c…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:bd26888a9120f27e370a69aacd51666c8311e329414865d564ca9e232ceb0aa1","downloaded_from":"2026-09-10T00:18:44.394Z","last_downloaded_at":"2026-09-10T00:18:44.394Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477787","source_sha256":"0fb2257cc38cd18a38c75824f27229b83aaf22d8df43c25a73bf83e7e52cf25d"}},{"citation":"405-942-45-4","para":"45-4","html":"
The interest paid or accrued on these accounts, commonly referred to as dividends, shall be reported as an expense on the statement of income, and the amount of interest payable to members shall be included as a liability in the statement of financial condition.
","snippet":"The interest paid or accrued on these accounts, commonly referred to as dividends, shall be reported as an expense on the statement of income, and the amount of interest payable to members shall be included as a liabilit…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f2df08cac4fa2576badadac62aaea2da66e305cff087cd1c367efd3bb0caedfe","downloaded_from":"2026-09-10T00:18:44.394Z","last_downloaded_at":"2026-09-10T00:18:44.394Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477787","source_sha256":"0fb2257cc38cd18a38c75824f27229b83aaf22d8df43c25a73bf83e7e52cf25d"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:149afaf688534438855d08c2b5d148e70c646399e95b7c8ee5938acd71948d26","downloaded_from":"2026-09-10T00:18:44.394Z","last_downloaded_at":"2026-09-10T00:18:44.394Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477787","source_sha256":"0fb2257cc38cd18a38c75824f27229b83aaf22d8df43c25a73bf83e7e52cf25d"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:0b3e9ec3c03c0dc16fbf8920b159a5bc88c27a589d45de17c2e989159714a656","downloaded_from":"2026-09-10T00:18:44.394Z","last_downloaded_at":"2026-09-10T00:18:44.394Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477787","source_sha256":"0fb2257cc38cd18a38c75824f27229b83aaf22d8df43c25a73bf83e7e52cf25d"}},{"number":"50","label":"50 Disclosure","anchor":"50-disclosure","is_sec":false,"groups":[{"block":null,"heading":"Deposits","paragraphs":[{"citation":"405-942-50-1","para":"50-1","html":"
Disclosures about deposit liabilities shall include all of the following:
  1. a
    The aggregate amount of time deposit accounts (including certificates of deposit) in denominations that meet or exceed the insured limit at the balance sheet date
  2. b
    Securities, mortgage loans, or other financial instruments that serve as collateral for deposits, that are otherwise not disclosed under Topic 860
  3. c
    The aggregate amount of any demand deposits that have been reclassified as loan balances, such as overdrafts, at the balance-sheet date
  4. d
    Deposits that are received on terms other than those available in the normal course of business.
","snippet":"Disclosures about deposit liabilities shall include all of the following:\n(a) The aggregate amount of time deposit accounts (including certificates of deposit) in denominations that meet or exceed the insured limit at th…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:706c668bfb80248803f60aafa21bc2c7ab19c29a6eed6022b1ab7006b5b1fe60","downloaded_from":"2026-09-10T00:18:48.452Z","last_downloaded_at":"2026-09-10T00:18:48.452Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478353","source_sha256":"1ef7a7146161993eab6b98a076dced2a98623eeec0324857e05214c0b5ad3ea8"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:5f0030ac0b67e8a0b71323bfea01cf8cf89bf1f6cd3f00055f706e80d2b91648","downloaded_from":"2026-09-10T00:18:48.452Z","last_downloaded_at":"2026-09-10T00:18:48.452Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478353","source_sha256":"1ef7a7146161993eab6b98a076dced2a98623eeec0324857e05214c0b5ad3ea8"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:c070bef8ec479951f3cf3adb00d6cd13728145a7c10717f0bfcfe117f1e23669","downloaded_from":"2026-09-10T00:18:48.452Z","last_downloaded_at":"2026-09-10T00:18:48.452Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478353","source_sha256":"1ef7a7146161993eab6b98a076dced2a98623eeec0324857e05214c0b5ad3ea8"}},{"number":"55","label":"55 Implementation Guidance and Illustrations","anchor":"55-implementation-guidance-and-illustrations","is_sec":false,"groups":[{"block":null,"heading":"Implementation Guidance","paragraphs":[{"citation":"405-942-55-1","para":"55-1","html":"
For a credit union to be in compliance with the Codification, it must be unequivocal on the face of the statement of financial condition that savings accounts are a liability.
","snippet":"For a credit union to be in compliance with the Codification, it must be unequivocal on the face of the statement of financial condition that savings accounts are a liability.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:0fbdbeddd42a20e41f8ba298a9617abfe38fc24d57b5ef312ef44f13602658c6","downloaded_from":"2026-09-10T00:18:51.823Z","last_downloaded_at":"2026-09-10T00:18:51.823Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477683","source_sha256":"ad3516eb9fb40e8faa0abc84dcb165bbfa7e54943e2492bade7301ae6c2f112b"}},{"citation":"405-942-55-2","para":"55-2","html":"
A credit union statement of financial condition shall either:
  1. a
    Present savings accounts as the first item in the liabilities and equity section
  2. b
    Include savings accounts within a captioned subtotal for total liabilities.
","snippet":"A credit union statement of financial condition shall either:\n(a) Present savings accounts as the first item in the liabilities and equity section\n(b) Include savings accounts within a captioned subtotal for total liabil…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:2832ace07f2ae86d30a147aa9b9b4b5fd0071350ecdc830464cac90064aa94e4","downloaded_from":"2026-09-10T00:18:51.823Z","last_downloaded_at":"2026-09-10T00:18:51.823Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477683","source_sha256":"ad3516eb9fb40e8faa0abc84dcb165bbfa7e54943e2492bade7301ae6c2f112b"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:49a87f6d59f0bf5300a00a2ebfd0b5c14d5b182fc6d35f441b91cf5c29e82bec","downloaded_from":"2026-09-10T00:18:51.823Z","last_downloaded_at":"2026-09-10T00:18:51.823Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477683","source_sha256":"ad3516eb9fb40e8faa0abc84dcb165bbfa7e54943e2492bade7301ae6c2f112b"}},{"block":null,"heading":"Illustrations","paragraphs":[{"citation":"405-942-55-3","para":"55-3","html":"
This Example provides an illustration in which it is unequivocal on the face of the statement of financial condition that savings accounts are a liability.
","snippet":"This Example provides an illustration in which it is unequivocal on the face of the statement of financial condition that savings accounts are a liability.\nSample Credit Union\nStatements of Financial Condition\nDecember 3…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:18d8bedb225a19726f49fad884ee36a113da21fa7943958d7806084d4fff15d0","downloaded_from":"2026-09-10T00:18:51.823Z","last_downloaded_at":"2026-09-10T00:18:51.823Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477683","source_sha256":"ad3516eb9fb40e8faa0abc84dcb165bbfa7e54943e2492bade7301ae6c2f112b"}},{"citation":"405-942-55-4","para":"55-4","html":"
This Example provides an illustration in which it is unequivocal on the face of the statement of financial condition that savings accounts are a liability.
","snippet":"This Example provides an illustration in which it is unequivocal on the face of the statement of financial condition that savings accounts are a liability.\nSample Credit Union\nStatements of Financial Condition\nDecember 3…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:b76983f18980ca76c183bd5d8800e4dde0f050b0e0574fc6abcff3c7fd4ac93e","downloaded_from":"2026-09-10T00:18:51.823Z","last_downloaded_at":"2026-09-10T00:18:51.823Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477683","source_sha256":"ad3516eb9fb40e8faa0abc84dcb165bbfa7e54943e2492bade7301ae6c2f112b"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:2a69f9d8203f1979733c0358217b62dbf5465390b779fccb3179bc41d8d04a95","downloaded_from":"2026-09-10T00:18:51.823Z","last_downloaded_at":"2026-09-10T00:18:51.823Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477683","source_sha256":"ad3516eb9fb40e8faa0abc84dcb165bbfa7e54943e2492bade7301ae6c2f112b"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:5045bdf379628ab5ca8f00883e0cd5e16137ecc55e9ed67525c91f24f4a77e8e","downloaded_from":"2026-09-10T00:18:51.823Z","last_downloaded_at":"2026-09-10T00:18:51.823Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477683","source_sha256":"ad3516eb9fb40e8faa0abc84dcb165bbfa7e54943e2492bade7301ae6c2f112b"}}],"enrichment":{"summary":"This Subtopic governs how depository and lending institutions recognize, measure, present, and disclose deposit liabilities and short-sale obligations. Deposit liabilities are recognized when deposits are received (not when funds are collected), with deposit float recorded as both an asset and a liability, and credit unions must present member share/savings accounts unequivocally as liabilities. Short sales (\"securities sold, not yet purchased\") are reported as liabilities measured at fair value through income, with interest on short positions accrued as interest expense.","key_points":["Obligations incurred in short sales are reported as liabilities, generally called securities sold, not yet purchased (405-942-25-1), with additional guidance in 815-10-55-57.","Short-sale obligations are subsequently measured at fair value through the income statement at each reporting date with interest accrued as interest expense (405-942-35-1); the fair value adjustment is classified with gains and losses on securities (405-942-45-1).","A deposit liability is recognized when deposits are received, not when the institution collects the funds; deposit float (checks in process of collection, not available for withdrawal) is recorded as both an asset and a liability, and deposits are not recorded based solely on collections (405-942-25-3).","Credit unions and corporate credit unions must report all member deposit accounts, including member shares, unequivocally as liabilities on the statement of financial condition (405-942-25-4; 405-942-55-1).","Credit union statements of financial condition must either present deposit/savings accounts as the first item in the liabilities and equity section or include them within a captioned total-liabilities subtotal; an unclassified presentation showing savings accounts last before retained earnings is unacceptable (405-942-45-3; 405-942-55-2).","Interest on member accounts (commonly called dividends) is reported as expense in the statement of income, and interest payable to members is included as a liability (405-942-45-4).","Required deposit disclosures include aggregate time deposits (including CDs) at or above the insured limit, instruments pledged as collateral for deposits not otherwise disclosed under Topic 860, demand deposits reclassified as loans such as overdrafts, and deposits received on terms other than those available in the normal course of business (405-942-50-1)."],"categories":["Recognition","Presentation","Disclosure","Industry-specific"],"audience_level":"intermediate","student_note":"Two traps: deposits become liabilities when received, not when the check clears (float sits on both sides of the balance sheet), and credit union \"shares\"/savings accounts are liabilities despite the equity-sounding label and the \"dividend\" terminology used for interest paid on them.","related_topics":["942-10","815-10","860","480","825","942-405"],"key_concepts":["deposit liabilities","deposit float","securities sold, not yet purchased","short sales","member share accounts","redeemable preferred stock of a subsidiary","uninsured time deposits","credit union 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Liabilities for claims costs and future policyholder benefits are in Subtopic 944-40, premium deficiencies in 944-60, and policyholder dividends in 944-50. The substantive rule here: a ceding entity that agrees to service the reinsured contracts without reasonable compensation must accrue a liability for estimated excess future servicing costs (405-944-25-1).","concepts":["reinsurance contract","ceding entity","excess future servicing costs","policyholder benefits","premium deficiency","policyholder dividends","insurance liabilities"],"categories":["Recognition","Industry-specific","Subsequent measurement"],"level":"intermediate","topic_title":"Liabilities","sections":[{"number":"00","label":"00 Status","anchor":"00-status","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-944-00-1","para":"00-1","html":"
The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
Dividend to PolicyholdersAddedAccounting Standards Update No. 2014-0603/14/2014
944-405-05-1AmendedAccounting Standards Update No. 2016-1912/14/2016
944-405-05-2AmendedAccounting Standards Update No. 2014-0603/14/2014
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This Subtopic provides guidance to insurance entities on accounting for and financial reporting of liabilities. The guidance in this Subtopic is provided in the following two Subsections:
  1. a
    General
  2. b
    Reinsurance contracts.
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For guidance on liabilities for claims costs and future policyholder benefits, see Subtopic 944-40. For guidance on liabilities related to premium deficiencies, see Subtopic 944-60. For guidance on liabilities for dividends to policyholders, see Subtopic 944-50.
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This Subtopic provides guidance to insurance entities on accounting for and financial reporting of liabilities related to reinsurance contracts.
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This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 944-10-15.
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The Reinsurance Contracts Subsections of this Subtopic follow the same Scope and Scope Exceptions as outlined in the General Subsection of this Section, with specific instrument qualifications noted below.
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The guidance in the Reinsurance Contracts Subsections of this Subtopic applies only to reinsurance contracts. For guidance on identifying a reinsurance contract, see the Reinsurance Contracts Subsection of Section 944-20-15.
","snippet":"The guidance in the Reinsurance Contracts Subsections of this Subtopic applies only to reinsurance contracts. For guidance on identifying a reinsurance contract, see the Reinsurance Contracts Subsection of Section 944-20…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:393dccf6b2e41c6af99b627f89fbecb3d54e82934cb37d06f5753070b944b8c2","downloaded_from":"2026-09-10T00:19:02.199Z","last_downloaded_at":"2026-09-10T00:19:02.199Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478046","source_sha256":"a2d82a36154606c38f4a7ad19de452e1b2d815f7aa44ec16183f5a224410ff4e"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:356b1196f19e5a304910e3c2f66746acb59bcc202d8a7af74b993552e121b727","downloaded_from":"2026-09-10T00:19:02.199Z","last_downloaded_at":"2026-09-10T00:19:02.199Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478046","source_sha256":"a2d82a36154606c38f4a7ad19de452e1b2d815f7aa44ec16183f5a224410ff4e"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:cf1ccf395ded670a03c0c9bcff36dd39fbda853893c361616601def0ba89c4d9","downloaded_from":"2026-09-10T00:19:02.199Z","last_downloaded_at":"2026-09-10T00:19:02.199Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478046","source_sha256":"a2d82a36154606c38f4a7ad19de452e1b2d815f7aa44ec16183f5a224410ff4e"}},{"number":"25","label":"25 Recognition","anchor":"25-recognition","is_sec":false,"groups":[{"block":"Reinsurance Contracts","heading":null,"paragraphs":[{"citation":"405-944-25-1","para":"25-1","html":"
If a ceding entity has agreed to service all of the related insurance contracts without reasonable compensation, a liability shall be accrued for estimated excess future servicing costs under the reinsurance contract.
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Liabilities for claims costs and future policyholder benefits are in Subtopic 944-40, premium deficiencies in 944-60, and policyholder dividends in 944-50. The substantive rule here: a ceding entity that agrees to service the reinsured contracts without reasonable compensation must accrue a liability for estimated excess future servicing costs (405-944-25-1).","key_points":["The Subtopic is organized into a General Subsection and a Reinsurance Contracts Subsection, both addressing insurance entity liabilities (405-944-05-1).","Cross-references direct users elsewhere: claims costs and future policyholder benefits to Subtopic 944-40, premium deficiencies to 944-60, and dividends to policyholders to 944-50 (405-944-05-2).","Scope follows Section 944-10-15 (the Overall insurance Subtopic), and the Reinsurance Contracts Subsections apply only to reinsurance contracts, identified under 944-20-15 (405-944-15-1 through 15-3).","If a ceding entity agrees to service all related insurance contracts without reasonable compensation, it must accrue a liability for estimated excess future servicing costs under the reinsurance contract (405-944-25-1)."],"categories":["Recognition","Industry-specific","Subsequent measurement"],"audience_level":"intermediate","student_note":"The only operative rule in this Subtopic is the accrual of excess future servicing costs by a ceding entity that services reinsured contracts for less than reasonable compensation; everything else is a signpost to Subtopics 944-40, 944-50, and 944-60. 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It requires accounts payable to be broken out separately for investment securities purchased and for capital stock reacquired, and describes what falls into \"other liabilities.\" Foreign-currency payables are translated at current exchange rates and may be grouped with the corresponding functional currency payables.","concepts":["investment company","statement of assets and liabilities","accounts payable","securities lending collateral","dividends and distributions payable","foreign currency payables","functional currency","capital stock reacquired"],"categories":["Presentation","Industry-specific","Foreign currency","Financial statement presentation"],"level":"intermediate","topic_title":"Liabilities","sections":[{"number":"05","label":"05 Overview and Background","anchor":"05-overview-and-background","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-946-05-1","para":"05-1","html":"
This Subtopic addresses an investment company's accounting for liabilities.
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This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 946-10-15.
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Accounts payable shall be listed separately for investment securities purchased and capital stock reacquired.
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The line item other liabilities includes amounts due to counterparties for collateral on return of securities loaned, deferred income, and dividends and distributions payable. Payables denominated in foreign currencies shall be converted into the functional currency at current exchange rates and may be categorized within the corresponding functional currency payables.
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Payables denominated in foreign currencies s…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:61cfe843e1b0dc7acedf33e2c20e94f3ec5bc2c9b964ea10645f8e33c51f7367","downloaded_from":"2026-09-10T00:19:18.650Z","last_downloaded_at":"2026-09-10T00:19:18.650Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478790","source_sha256":"39c7903a92190fab987a4897894ccdccb238da40e77a8d597edc4aca79d22c67"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:371dbbb735de7710fc78bb521a67a732500f021cc82c580d491f9fa5160f23c2","downloaded_from":"2026-09-10T00:19:18.650Z","last_downloaded_at":"2026-09-10T00:19:18.650Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478790","source_sha256":"39c7903a92190fab987a4897894ccdccb238da40e77a8d597edc4aca79d22c67"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:3c6f6f66a32595fec799535a4d8f1c4db0e1ceeff501d7ff1f4786108567c411","downloaded_from":"2026-09-10T00:19:18.650Z","last_downloaded_at":"2026-09-10T00:19:18.650Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478790","source_sha256":"39c7903a92190fab987a4897894ccdccb238da40e77a8d597edc4aca79d22c67"}}],"enrichment":{"summary":"This Subtopic gives presentation guidance for liabilities in an investment company's statement of assets and liabilities. It requires accounts payable to be broken out separately for investment securities purchased and for capital stock reacquired, and describes what falls into \"other liabilities.\" Foreign-currency payables are translated at current exchange rates and may be grouped with the corresponding functional currency payables.","key_points":["The Subtopic addresses an investment company's accounting for liabilities (405-946-05-1) and follows the scope of Section 946-10-15 (405-946-15-1).","Accounts payable must be listed separately for investment securities purchased and for capital stock reacquired (405-946-45-1).","Other liabilities includes amounts due to counterparties for collateral on return of securities loaned, deferred income, and dividends and distributions payable (405-946-45-2).","Payables denominated in foreign currencies are converted into the functional currency at current exchange rates and may be categorized within the corresponding functional currency payables (405-946-45-2)."],"categories":["Presentation","Industry-specific","Foreign currency","Financial statement presentation"],"audience_level":"intermediate","student_note":"This is a short, purely presentational subtopic: it dictates line-item detail on a fund's statement of assets and liabilities rather than recognition or measurement. 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Providers that bear risk for referrals and outside services must accrue a liability for unpaid claims, including incurred but not reported (IBNR) claims, and must accrue health care costs as services are rendered, including services required beyond the premium period and post-termination costs. It also clarifies that entering into a Medicare fraud settlement that requires five years of future compliance audits is not itself the obligating event, so no liability is recognized for those future audits.","concepts":["capitation contract","incurred but not reported claims","unpaid claims liability","prepaid health care services","lag analysis","obligating event","third-party settlements","risk-retention and bonus programs"],"categories":["Recognition","Disclosure","Industry-specific","Contingencies and guarantees"],"level":"intermediate","topic_title":"Liabilities","sections":[{"number":"00","label":"00 Status","anchor":"00-status","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-954-00-1","para":"00-1","html":"
The following table identifies the changes made to this Subtopic.
Paragraph Action Accounting Standards Update Date
954-405-25-1 Amended Accounting Standards Update No. 2014-09 05/28/2014
954-405-25-3 Superseded Accounting Standards Update No. 2014-09 05/28/2014
954-405-25-5 Amended Accounting Standards Update No. 2024-02 03/29/2024
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This Subtopic provides guidance on liabilities for health care entities within the scope of this Topic.
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Contracts between a health care provider and a payor based on anything other than full charges require the provider to accept some financial risk. The nature and degree of risk for the provider varies depending on the contract terms (for example, the definition of the unit of service or the basis for payment).
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This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 954-10-15.
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If a capitation contract obligates the provider to assume the risk of physician referrals and other outside services, a liability for unpaid claims, including incurred but not reported claims, shall be established. A lag analysis may be helpful in estimating the liability.
","snippet":"If a capitation contract obligates the provider to assume the risk of physician referrals and other outside services, a liability for unpaid claims, including incurred but not reported claims, shall be established. A lag…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:755374ff53a0c6181d18e36a663db0047d87fccfabc7681f7f79240e8f380383","downloaded_from":"2026-09-10T00:19:32.072Z","last_downloaded_at":"2026-09-10T00:19:32.072Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478889","source_sha256":"2c9e35441412b61903ff4bf78e9615c79dc843872d47e83747096b9b34b29195"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:2bf7d14268d4fb90d01452a3c51a2f79300585cba1a513438841f7cf4de9f8db","downloaded_from":"2026-09-10T00:19:32.072Z","last_downloaded_at":"2026-09-10T00:19:32.072Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478889","source_sha256":"2c9e35441412b61903ff4bf78e9615c79dc843872d47e83747096b9b34b29195"}},{"block":null,"heading":"Prepaid Health Care Services","paragraphs":[{"citation":"405-954-25-2","para":"25-2","html":"
Health care costs shall be accrued as services are rendered, including estimates of the costs of services rendered but not yet reported. Furthermore, if a provider of prepaid health care services is obligated to render services to specific members beyond the premium period due to provisions in the contract or regulatory requirements, the costs of such services to be incurred also shall be accrued currently. Costs that will be incurred after a contract is terminated, such as guaranteed salaries, rent, and depreciation, net of any anticipated revenues, shall be accrued when it is determined that a contract with a sponsoring employer or other group will be terminated. Amounts payable to hospitals, physicians, or other health care providers under risk-retention, bonus, or similar programs shall be accrued during the contract period based on relevant factors, such as experience to date.
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Paragraph superseded by Accounting Standards Update No. 2014-09.
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A number of health care entities have entered into settlement agreements with the U.S. government regarding allegations of Medicare fraud. In addition to the promise to pay specified penalties to the U.S. government, the settlement agreements impose an obligation on the health care entity to engage an independent review entity to test and report on compliance with Medicare requirements each year for the following five years.
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The settlement agreement represents a promise by a health care entity to perform future compliance audits and a duty or responsibility on which others are justified in relying is created by that promise. However, that promise creates a present duty or responsibility only if an obligating event has already occurred (the third characteristic of a liability; see paragraph 6 of FASB Concepts Statement No. 6, Elements of Financial Statements) that leaves the health care entity with little or no discretion to avoid the future transfer or use of assets. The obligating event for the costs of the future compliance audits is not entering into the agreement. Therefore, the entity shall not recognize a liability for the future Medicare compliance audits on the date the settlement is agreed to.
Transition date:(P) December 16, 2024; (N) December 16, 2025Transition guidance:
105-10-65-9The settlement agreement represents a promise by a health care entity to perform future compliance audits and a duty or responsibility on which others are justified in relying is created by that promise. However, that promise creates a present duty or responsibility only if an obligating event has already occurred that leaves the health care entity with little or no discretion to avoid the future transfer or use of assets. The obligating event for the costs of the future compliance audits is not entering into the agreement. Therefore, the entity shall not recognize a liability for the future Medicare compliance audits on the date the settlement is agreed to.
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Section not used.
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With regard to contractual adjustments and third-party settlements, identification and explanation of the estimated amounts that are payable by the entity shall be disclosed.
","snippet":"With regard to contractual adjustments and third-party settlements, identification and explanation of the estimated amounts that are payable by the entity shall be disclosed.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:752acfbf0c2061fc537870fa4fc4419b77fd8d199339791f01d287dba67e702e","downloaded_from":"2026-09-10T00:19:36.311Z","last_downloaded_at":"2026-09-10T00:19:36.311Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147479043","source_sha256":"18228a08056909057e2964ea788011d6f7b9ef35e875833591de3a08cff68f32"}},{"citation":"405-954-50-2","para":"50-2","html":"
For providers of prepaid health care services, the basis for accruing health care costs and significant business and contractual arrangements with hospitals, physicians, or other associated entities shall be disclosed in the notes to financial statements.
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Providers that bear risk for referrals and outside services must accrue a liability for unpaid claims, including incurred but not reported (IBNR) claims, and must accrue health care costs as services are rendered, including services required beyond the premium period and post-termination costs. It also clarifies that entering into a Medicare fraud settlement that requires five years of future compliance audits is not itself the obligating event, so no liability is recognized for those future audits.","key_points":["A capitation contract that obligates the provider to assume the risk of physician referrals and other outside services requires establishing a liability for unpaid claims, including incurred but not reported claims; a lag analysis may help estimate it (405-954-25-1).","Health care costs are accrued as services are rendered, including estimates of the cost of services rendered but not yet reported (405-954-25-2).","If a prepaid health care provider must render services to specific members beyond the premium period (by contract or regulation), the costs of those services are accrued currently (405-954-25-2).","Costs to be incurred after contract termination—such as guaranteed salaries, rent, and depreciation, net of anticipated revenues—are accrued when it is determined a contract with a sponsoring employer or group will be terminated (405-954-25-2).","Amounts payable to hospitals, physicians, or other providers under risk-retention, bonus, or similar programs are accrued during the contract period based on relevant factors such as experience to date (405-954-25-2).","No liability is recognized on the settlement date for future Medicare compliance audits required by a fraud settlement agreement, because entering into the agreement is not the obligating event (405-954-25-4 through 25-5).","Disclosure is required of estimated amounts payable for contractual adjustments and third-party settlements, and, for prepaid health care providers, the basis for accruing health care costs and significant business/contractual arrangements with hospitals, physicians, or associated entities (405-954-50-1; 405-954-50-2)."],"categories":["Recognition","Disclosure","Industry-specific","Contingencies and guarantees"],"audience_level":"intermediate","student_note":"The recurring exam trap is timing: costs are accrued when services are rendered (including IBNR and obligations extending past the premium period), but a promise to perform future compliance audits under a Medicare settlement creates no liability because the obligating event hasn't occurred. Distinguish \"we already received/owe the service\" from \"we promised to do something in the future.\"","related_topics":["954-10","954-405","405-20","450-20","606","944-40"],"key_concepts":["capitation contract","incurred but not reported claims","unpaid claims liability","prepaid health care services","lag analysis","obligating event","third-party settlements","risk-retention and bonus programs"],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:903338166a5e427c33e85413e25970d70866d4ef4cc0373d9e47f4350cc4dc42","downloaded_from":"2026-09-10T00:19:21.041Z","last_downloaded_at":"2026-09-10T00:19:37.991Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},"related":[{"number":"450-954","title":"Health Care 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It fixes the discount rate used in a present-value measurement at initial recognition (no revision unless the fair value option under 825-10 is elected), requires discount amortization to be reported in the same functional expense classification as the original promise, and requires a maturity schedule disclosure. It also cross-references guidance for donated assets transferred to intermediaries/agents and for refundable membership interests of social and country clubs.","concepts":["unconditional promise to give","present value measurement","fixed discount rate","discount amortization","functional expense classification","maturity schedule disclosure","agent and intermediary transfers","refundable membership interests"],"categories":["Not-for-profit","Subsequent measurement","Disclosure","Recognition"],"level":"intermediate","topic_title":"Liabilities","sections":[{"number":"00","label":"00 Status","anchor":"00-status","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-958-00-1","para":"00-1","html":"
The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
Conditional ContributionAddedAccounting Standards Update No. 2018-0806/21/2018
ContributionAddedAccounting Standards Update No. 2018-0806/21/2018
Donor-Imposed ConditionAddedAccounting Standards Update No. 2018-0806/21/2018
Functional ClassificationSupersededAccounting Standards Update No. 2016-1408/18/2016
Functional Expense ClassificationAddedAccounting Standards Update No. 2016-1408/18/2016
958-405-25-2SupersededAccounting Standards Update No. 2014-0905/28/2014
958-405-45-1AmendedAccounting Standards Update No. 2016-1408/18/2016
","snippet":"The following table identifies the changes made to this Subtopic.\nParagraph | Action | Accounting Standards Update | Date |\n| | | |\nConditional Contribution | Added | Accounting Standards Update No. 2018-08 | 06/21/2018 …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:4e2f1f866eb01915a29b806bd13e146e8d1a29df79311677a9ae93de9d6c8047","downloaded_from":"2026-09-10T00:19:40.959Z","last_downloaded_at":"2026-09-10T00:19:40.959Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478396","source_sha256":"f1cda56742e8f4e4daf322568c1ee3f1b0113471187a983c8b6a1b0a244c469f"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:a745ef27b2feae6d9fe1af285610357596144cdfcea12db855b4c1dca7eeac3d","downloaded_from":"2026-09-10T00:19:40.959Z","last_downloaded_at":"2026-09-10T00:19:40.959Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478396","source_sha256":"f1cda56742e8f4e4daf322568c1ee3f1b0113471187a983c8b6a1b0a244c469f"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:08766aca17319c43e6e9abfd1408dac7a2aadd64d427e7159bff999ce72477f6","downloaded_from":"2026-09-10T00:19:40.959Z","last_downloaded_at":"2026-09-10T00:19:40.959Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478396","source_sha256":"f1cda56742e8f4e4daf322568c1ee3f1b0113471187a983c8b6a1b0a244c469f"}},{"number":"05","label":"05 Overview and Background","anchor":"05-overview-and-background","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-958-05-1","para":"05-1","html":"
This Subtopic provides guidance about promises to give made by not-for-profit entities (NFPs). NFPs also shall comply with the applicable standards in Subtopic 720-25. This Subtopic also identifies the Sections within the Not-For-Profit Entities Topic that provide guidance on accounting for liabilities.
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This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 958-10-15.
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For recognition guidance on liabilities that result from transfers of donated assets to intermediaries and agents, see paragraphs
958-605-25-23 through 25-24
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","snippet":"For recognition guidance on liabilities that result from transfers of donated assets to intermediaries and agents, see paragraphs 958-605-25-23 through 25-24.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:be64497c0bcfd04f1ead1518b6a1213a7f83de36dac10bc51d03b42bb3785288","downloaded_from":"2026-09-10T00:19:53.538Z","last_downloaded_at":"2026-09-10T00:19:53.538Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478880","source_sha256":"bd473d3abaed602e99780ec7636c8d9a7e09fc9d671a4829d9cae347abc0a2c7"}},{"citation":"405-958-25-2","para":"25-2","html":"
Paragraph superseded by Accounting Standards Update No. 2014-09.
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A not-for-profit entity (NFP) that is a social or country club may issue membership interests, such as capital shares. If those interests are wholly or partially refundable when the member dies, moves away, resigns his or her membership, or at a fixed date, Subtopic 480-10 provides guidance.
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For initial measurement guidance on liabilities that result from transfers of donated assets to intermediaries and agents, see paragraph 958-605-30-13.
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For initial measurement guidance on liabilities that result from making promises to give, see paragraphs
720-25-30-1 through 30-2
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If the present value of the amounts to be paid is used to measure fair value of an unconditional promise to give at initial recognition, in conformity with paragraphs
835-30-25-10 through 25-11
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The amortization of any discount related to unconditional promises to give shall be reported in the same functional expense classification in which the promise to give was initially reported.
","snippet":"The amortization of any discount related to unconditional promises to give shall be reported in the same functional expense classification in which the promise to give was initially reported.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:49f52aefd5a9b2a22fc86d03ac657bbdfd85b461e16d25106509ba2469f6ac76","downloaded_from":"2026-09-10T00:20:02.539Z","last_downloaded_at":"2026-09-10T00:20:02.539Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478307","source_sha256":"831c0ce1a98fdb1e318a3cdc7661550ee2f75d55110516d6e7239c3ca6f88bef"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:9d5edf8b5011e1a81bbb10b0d6dd857828233841a65d93d0fa02e869ae0faeb5","downloaded_from":"2026-09-10T00:20:02.539Z","last_downloaded_at":"2026-09-10T00:20:02.539Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478307","source_sha256":"831c0ce1a98fdb1e318a3cdc7661550ee2f75d55110516d6e7239c3ca6f88bef"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:95dd88d8ffab80b8758644784ca9040f8ac56fdc8e807e291ae26726c4e34728","downloaded_from":"2026-09-10T00:20:02.539Z","last_downloaded_at":"2026-09-10T00:20:02.539Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478307","source_sha256":"831c0ce1a98fdb1e318a3cdc7661550ee2f75d55110516d6e7239c3ca6f88bef"}},{"number":"50","label":"50 Disclosure","anchor":"50-disclosure","is_sec":false,"groups":[{"block":null,"heading":"Liability for Promises to Give","paragraphs":[{"citation":"405-958-50-1","para":"50-1","html":"
In addition to disclosures required by Section 450-20-50, the notes to financial statements shall include a schedule of unconditional promises to give that shows the total amount separated into amounts payable in each of the next five years, the aggregate amount due in more than five years, and for unconditional promises to give that are reported using present value techniques, the unamortized discount.
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For guidance for not-for-profit entities (NFPs) that have entered into settlement agreements with the U.S. government regarding allegations of Medicare fraud that impose an obligation on the entity to engage an independent review entity to test and report on compliance with Medicare requirements each year for five years, see Section 954-405-25.
","snippet":"For guidance for not-for-profit entities (NFPs) that have entered into settlement agreements with the U.S. government regarding allegations of Medicare fraud that impose an obligation on the entity to engage an independe…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:0602a1e83e264e723257ab989f71a6780c2e859ae9f7bbac4cad25fec8fd6971","downloaded_from":"2026-09-10T00:20:08.319Z","last_downloaded_at":"2026-09-10T00:20:08.319Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477455","source_sha256":"453c0eca1880ddd583e162dff108b3058d246dce23618843d35ed8b051e6a7bb"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:e903f894d913a3477e1bb17f8e6e337235d8f798b381433811263cac29d43ffb","downloaded_from":"2026-09-10T00:20:08.319Z","last_downloaded_at":"2026-09-10T00:20:08.319Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477455","source_sha256":"453c0eca1880ddd583e162dff108b3058d246dce23618843d35ed8b051e6a7bb"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:b9ac578d37d6cf522b3ec11401cb99678c7748904f95c48a7c888aa54bccb5ca","downloaded_from":"2026-09-10T00:20:08.319Z","last_downloaded_at":"2026-09-10T00:20:08.319Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477455","source_sha256":"453c0eca1880ddd583e162dff108b3058d246dce23618843d35ed8b051e6a7bb"}}],"enrichment":{"summary":"This Subtopic addresses how a not-for-profit entity accounts for its own liabilities, principally unconditional promises to give (grants/pledges the NFP makes to others). It fixes the discount rate used in a present-value measurement at initial recognition (no revision unless the fair value option under 825-10 is elected), requires discount amortization to be reported in the same functional expense classification as the original promise, and requires a maturity schedule disclosure. It also cross-references guidance for donated assets transferred to intermediaries/agents and for refundable membership interests of social and country clubs.","key_points":["Recognition of liabilities from transfers of donated assets to intermediaries and agents follows 958-605-25-23 through 25-24, with initial measurement in 958-605-30-13 (405-958-25-1; 405-958-30-1).","Initial measurement of liabilities arising from making promises to give is governed by 720-25-30-1 through 30-2 (405-958-30-2).","If present value of amounts to be paid is used to measure the fair value of an unconditional promise to give at initial recognition (per 835-30-25-10 through 25-11), the discount rate is set at initial recognition and shall not be revised unless the promise is remeasured at fair value under the Fair Value Option Subsections of 825-10 (405-958-35-1).","Amortization of discount on unconditional promises to give is reported in the same functional expense classification in which the promise was initially reported (405-958-45-1).","Notes must include, in addition to 450-20-50 disclosures, a schedule of unconditional promises to give showing amounts payable in each of the next five years, the aggregate due in more than five years, and the unamortized discount for promises reported at present value (405-958-50-1).","Membership interests such as capital shares issued by an NFP social or country club that are wholly or partially refundable on death, relocation, resignation, or at a fixed date are addressed by Subtopic 480-10 (405-958-25-3).","NFPs that must engage an independent review entity for five years under a Medicare fraud settlement agreement look to Section 954-405-25 (405-958-60-1)."],"categories":["Not-for-profit","Subsequent measurement","Disclosure","Recognition"],"audience_level":"intermediate","student_note":"Watch the direction of the promise: this Subtopic covers promises the NFP makes (a liability), while 958-605 covers promises received (a receivable/contribution). The classic trap is revising the discount rate in later periods — the rate is locked in at initial recognition unless the fair value option is elected, and the discount amortization stays in the original functional expense line rather than becoming interest expense.","related_topics":["720-25","958-605","835-30","825-10","480-10","954-405"],"key_concepts":["unconditional promise to give","present value measurement","fixed discount rate","discount amortization","functional expense classification","maturity schedule disclosure","agent and intermediary transfers","refundable membership 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by retrieval timestamps"}},{"number":"470-958","title":"Not-for-Profit Entities","topic_title":"Debt","score":0.8032,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:c84f7651c7fd34a442aac40ade29104e2f52366a06bcc3514e2e70f90cc14e55","downloaded_from":"2026-09-10T00:34:51.743Z","last_downloaded_at":"2026-09-10T00:34:59.299Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"450-958","title":"Not-for-Profit Entities","topic_title":"Contingencies","score":0.7962,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8a48a90380515377a71fd91d9ead3e400aa830080ddf047955d980f779c67880","downloaded_from":"2026-09-10T00:28:58.769Z","last_downloaded_at":"2026-09-10T00:29:12.159Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"720-25","title":"Contributions Made","topic_title":"Other Expenses","score":0.7508,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:d9267a5d452a65c0e77029dc20d9b0a24f4a5c90b006239670773398dd31d63c","downloaded_from":"2026-09-10T01:07:47.863Z","last_downloaded_at":"2026-09-10T01:08:09.526Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"958-10","title":"Overall","topic_title":"Not-for-Profit Entities","score":0.7403,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:9c7e0ee746dbd1dd2e99d8d55f0f587902e1c081b34157fa60894d69fdc10270","downloaded_from":"2026-09-10T02:21:08.558Z","last_downloaded_at":"2026-09-10T02:21:26.859Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"325-958","title":"Not-for-Profit Entities","topic_title":"Investments—Other","score":0.7377,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:7fc8383164c115792c74d6fbaecbccfb2cd497dd35ddba8f4148d0896e9716ee","downloaded_from":"2026-09-09T23:47:13.039Z","last_downloaded_at":"2026-09-09T23:47:39.630Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}}],"prev":{"number":"405-954","title":"Health Care Entities","topic_title":"Liabilities","provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:9ea7001fb48a96fd7c7b72167cbc05a1cd8c7bd8db2a2421b071118666bb3100","downloaded_from":"2026-09-10T00:19:21.041Z","last_downloaded_at":"2026-09-10T00:19:37.991Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},"next":{"number":"405-980","title":"Regulated Operations","topic_title":"Liabilities","provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:d03141c66a2b7d8085b382cc11a67acfd7adfe8c8fd310ff14354f15aab8570f","downloaded_from":"2026-09-10T00:20:12.403Z","last_downloaded_at":"2026-09-10T00:20:28.784Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f635772f3a0ea59489fd0928c29e13abd1b1ffca9af0b848fa2311ccdcd1ffa7","downloaded_from":"2026-09-10T00:19:40.959Z","last_downloaded_at":"2026-09-10T00:20:08.319Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"405-980","topic":"405","title":"Regulated Operations","area":"Liabilities","paragraphs":5,"summary":"This Subtopic explains when a regulator's rate actions create liabilities (regulatory liabilities) for an entity with regulated operations. Three mechanisms create liabilities: required refunds to customers that meet the loss-contingency accrual criteria, current rates collected to recover costs expected to be incurred in the future for which the entity remains accountable, and gains or other reductions of net allowable costs that the regulator requires be amortized to customers over future periods. A regulator's actions can eliminate a liability only if the regulator's actions imposed it in the first place.","concepts":["regulatory liability","rate actions of a regulator","allowable costs","refunds to customers","loss contingency accrual","deferred revenue recognition","amortization of gains for rate-making","regulated operations"],"categories":["Recognition","Derecognition","Industry-specific","Revenue"],"level":"intermediate","topic_title":"Liabilities","sections":[{"number":"05","label":"05 Overview and Background","anchor":"05-overview-and-background","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"405-980-05-1","para":"05-1","html":"
This Subtopic provides guidance for liabilities for entities with regulated operations.
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This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 980-10-15.
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Rate actions of a regulator can impose a liability on a regulated entity. Such liabilities are usually obligations to the entity's customers. The following are the usual ways in which liabilities can be imposed and the resulting accounting:
  1. a
    A regulator may require refunds to customers. Refunds can be paid to the customers who paid the amounts being refunded; however, they are usually provided to current customers by reducing current charges. Refunds that meet the criteria of accrual of loss contingencies (see paragraph 450-20-25-2) shall be recorded as liabilities and as reductions of revenue or as expenses of the regulated entity.
  2. b
    A regulator can provide current rates intended to recover costs that are expected to be incurred in the future with the understanding that if those costs are not incurred future rates will be reduced by corresponding amounts. If current rates are intended to recover such costs and the regulator requires the entity to remain accountable for any amounts charged pursuant to such rates and not yet expended for the intended purpose, the entity shall not recognize as revenues amounts charged pursuant to such rates. The usual mechanism used by regulators for this purpose is to require the regulated entity to record the anticipated cost as a liability in its regulatory accounting records. Those amounts shall be recognized as liabilities and taken to income only when the associated costs are incurred. (For related implementation guidance, see paragraph 980-405-55-1).
  3. c
    A regulator can require that a gain or other reduction of net allowable costs be given to customers over future periods. That would be accomplished, for rate-making purposes, by amortizing the gain or other reduction of net allowable costs over those future periods and reducing rates to reduce revenues in approximately the amount of the amortization. If a gain or other reduction of net allowable costs is to be amortized over future periods for rate-making purposes, the regulated entity shall not recognize that gain or other reduction of net allowable costs in income of the current period. Instead, it shall record it as a liability for future reductions of charges to customers that are expected to result.
","snippet":"Rate actions of a regulator can impose a liability on a regulated entity. Such liabilities are usually obligations to the entity's customers. The following are the usual ways in which liabilities can be imposed and the r…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:a84f9ba22b29304b72ae8be98a912cbf6fddc4b0dc33f664184833ff5466f57e","downloaded_from":"2026-09-10T00:20:21.402Z","last_downloaded_at":"2026-09-10T00:20:21.402Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477571","source_sha256":"961229730bb8f4e23c6a6cc90ff20f6d88a3a87c7a7a4112473649d80c6e51b1"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:ae4dd9c30d044cec2e83fcbc9939a6d02f17670e01ba241330b5373b78b95004","downloaded_from":"2026-09-10T00:20:21.402Z","last_downloaded_at":"2026-09-10T00:20:21.402Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477571","source_sha256":"961229730bb8f4e23c6a6cc90ff20f6d88a3a87c7a7a4112473649d80c6e51b1"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:e48b752d11193e311d31c2b7ad061aeda20fe210f5c5671f1ec849913fc14648","downloaded_from":"2026-09-10T00:20:21.402Z","last_downloaded_at":"2026-09-10T00:20:21.402Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477571","source_sha256":"961229730bb8f4e23c6a6cc90ff20f6d88a3a87c7a7a4112473649d80c6e51b1"}},{"number":"40","label":"40 Derecognition","anchor":"40-derecognition","is_sec":false,"groups":[{"block":null,"heading":"Regulator-Imposed Liabilities","paragraphs":[{"citation":"405-980-40-1","para":"40-1","html":"
Actions of a regulator can eliminate a liability only if the liability was imposed by actions of the regulator.
","snippet":"Actions of a regulator can eliminate a liability only if the liability was imposed by actions of the regulator.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:4c5621e01e924c54ec2bd41992c8e6df26b8790c8fcdd31eb00a765df5926234","downloaded_from":"2026-09-10T00:20:24.235Z","last_downloaded_at":"2026-09-10T00:20:24.235Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478137","source_sha256":"5377d5f5f3bb891cad0f736785005abbf2b1301c61958757072f7ede60414425"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:c3875be4c26d90b7321f558772fe41ac0fbcf3de097c53f6db3f076ee3bd2a46","downloaded_from":"2026-09-10T00:20:24.235Z","last_downloaded_at":"2026-09-10T00:20:24.235Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478137","source_sha256":"5377d5f5f3bb891cad0f736785005abbf2b1301c61958757072f7ede60414425"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:8215a8c38004e587306ed0ffcae5afa568fe11732578f08f32f0ead76b9d00e9","downloaded_from":"2026-09-10T00:20:24.235Z","last_downloaded_at":"2026-09-10T00:20:24.235Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478137","source_sha256":"5377d5f5f3bb891cad0f736785005abbf2b1301c61958757072f7ede60414425"}},{"number":"55","label":"55 Implementation Guidance and Illustrations","anchor":"55-implementation-guidance-and-illustrations","is_sec":false,"groups":[{"block":null,"heading":"Implementation Guidance","paragraphs":[{"citation":"405-980-55-1","para":"55-1","html":"
This paragraph provides guidance on implementing paragraph 980-405-25-1(b). A regulator may direct a regulated entity to include an amount for a contingency in allowable costs for rate-making purposes even though the amount does not meet the criteria in Subtopic 450-20 for recording. For example, a regulator may direct a regulated entity to include an amount for repairs of expected future uninsured storm damage. If a cost to repair storm damage is not subsequently incurred, the increased charges will have to be refunded to customers through future rate reductions. Accordingly, the regulated entity would recognize the amounts charged pursuant to such rates as liabilities rather than as revenues. If a cost to repair storm damage is subsequently incurred, the entity would charge that cost to expense and reduce the liabilities at that time by recognizing income in amounts equal to the cost.
","snippet":"This paragraph provides guidance on implementing paragraph 980-405-25-1(b). A regulator may direct a regulated entity to include an amount for a contingency in allowable costs for rate-making purposes even though the amo…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:9bf3390594965f4ffb3e273741ae2620f10652de3203cfbba8fd6fd079ac12e0","downloaded_from":"2026-09-10T00:20:26.812Z","last_downloaded_at":"2026-09-10T00:20:26.812Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478509","source_sha256":"86d53acc1fe7e63b9330c01d8080c3f7a0ac13ee958e179e07a0c6b30ec43ad6"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:4afe5916a8d6f80e09d0ecac8d9499ae30fa666e1e329a7f4ac5742d934622f3","downloaded_from":"2026-09-10T00:20:26.812Z","last_downloaded_at":"2026-09-10T00:20:26.812Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478509","source_sha256":"86d53acc1fe7e63b9330c01d8080c3f7a0ac13ee958e179e07a0c6b30ec43ad6"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:bb40587369d1bc6e13fcac3d55a50ce7effe8dd1057d3171c8442fbc9faabef2","downloaded_from":"2026-09-10T00:20:26.812Z","last_downloaded_at":"2026-09-10T00:20:26.812Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147478509","source_sha256":"86d53acc1fe7e63b9330c01d8080c3f7a0ac13ee958e179e07a0c6b30ec43ad6"}}],"enrichment":{"summary":"This Subtopic explains when a regulator's rate actions create liabilities (regulatory liabilities) for an entity with regulated operations. Three mechanisms create liabilities: required refunds to customers that meet the loss-contingency accrual criteria, current rates collected to recover costs expected to be incurred in the future for which the entity remains accountable, and gains or other reductions of net allowable costs that the regulator requires be amortized to customers over future periods. A regulator's actions can eliminate a liability only if the regulator's actions imposed it in the first place.","key_points":["Rate actions of a regulator can impose a liability on a regulated entity, usually an obligation to the entity's customers (405-980-25-1).","Refunds required by a regulator that meet the criteria for accrual of loss contingencies in paragraph 450-20-25-2 are recorded as liabilities and as reductions of revenue or as expenses (405-980-25-1(a)).","When current rates are intended to recover costs expected to be incurred in the future and the regulator requires the entity to remain accountable for amounts collected but not yet expended, those amounts are recognized as liabilities rather than revenues and are taken to income only when the associated costs are incurred (405-980-25-1(b)).","A gain or other reduction of net allowable costs that is to be amortized over future periods for rate-making purposes is not recognized in current income; it is recorded as a liability for the expected future reductions of charges to customers (405-980-25-1(c)).","Actions of a regulator can eliminate a liability only if the liability was imposed by actions of the regulator (405-980-40-1).","Implementation example: amounts collected in rates for a regulator-directed contingency (e.g., expected future uninsured storm damage) that does not meet Subtopic 450-20 recognition criteria are recorded as liabilities, and income is recognized equal to the cost when the repair cost is incurred (405-980-55-1)."],"categories":["Recognition","Derecognition","Industry-specific","Revenue"],"audience_level":"intermediate","student_note":"This is the liability mirror image of regulatory assets: cash collected today under a regulator's rate order is not always revenue. The common misunderstanding is thinking a regulator can wipe out any liability — it can only eliminate liabilities that its own actions imposed.","related_topics":["980-10","980-340","980-405","450-20","980-605","606"],"key_concepts":["regulatory liability","rate actions of a regulator","allowable costs","refunds to customers","loss contingency accrual","deferred revenue recognition","amortization of gains for rate-making","regulated operations"],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:86156372b51ba401f71771a4b002e5bf481fe4d6495d6c34b0244498de8a0ded","downloaded_from":"2026-09-10T00:20:12.403Z","last_downloaded_at":"2026-09-10T00:20:28.784Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},"related":[{"number":"450-980","title":"Regulated Operations","topic_title":"Contingencies","score":0.8729,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:68aac7e997780097db4c6d2f8fd0b7534873753394f03e4f3df20f0ccdcc192a","downloaded_from":"2026-09-10T00:29:15.540Z","last_downloaded_at":"2026-09-10T00:29:23.763Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"410-980","title":"Regulated Operations","topic_title":"Asset Retirement and Environmental Obligations","score":0.816,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:a554ce65e81cf45312da62bb4332360fe49dea55d7548f0644cdc067f944506b","downloaded_from":"2026-09-10T00:22:01.250Z","last_downloaded_at":"2026-09-10T00:22:29.648Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"470-980","title":"Regulated Operations","topic_title":"Debt","score":0.7901,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:498456079d7a9fcb74ba3a1ed90b1732b97a3c036a860ec67ea2a8940c376f49","downloaded_from":"2026-09-10T00:35:14.586Z","last_downloaded_at":"2026-09-10T00:35:24.744Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"740-980","title":"Regulated Operations","topic_title":"Income Taxes","score":0.7459,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:a629350c795950069d0fcc45a07888d51c5f47e9291953dfa69e75f24db03cc3","downloaded_from":"2026-09-10T01:21:36.471Z","last_downloaded_at":"2026-09-10T01:21:55.089Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},{"number":"710-980","title":"Regulated 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Corrections","score":0.7259,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:90b5435919774481df1bd6ef0d5561e84b5ed0f4536774be67a7428854f7af92","downloaded_from":"2026-09-09T23:17:47.227Z","last_downloaded_at":"2026-09-09T23:17:57.739Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}}],"prev":{"number":"405-958","title":"Not-for-Profit Entities","topic_title":"Liabilities","provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:7d1d315b26ff285d9f56103a2d2e88f55a8a553f73caa2e8ed6b4578db00d500","downloaded_from":"2026-09-10T00:19:40.959Z","last_downloaded_at":"2026-09-10T00:20:08.319Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},"next":{"number":"410-10","title":"Overall","topic_title":"Asset Retirement and Environmental Obligations","provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:429fe5e86887b627349438c821787ab06d3cca7749682b6a96027d2d2a2c67fc","downloaded_from":"2026-09-10T00:20:32.113Z","last_downloaded_at":"2026-09-10T00:20:38.088Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}},"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:41877d518ce49aa2964f27dc64b87df4dc66c11e5cea10dcd0db24b9649af0d3","downloaded_from":"2026-09-10T00:20:12.403Z","last_downloaded_at":"2026-09-10T00:20:28.784Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}}],"paragraphs":242,"summary":"ASC 405 is the Codification's home for general liability guidance, but it works mostly as a roadmap plus a handful of targeted rules. The Overall Subtopic (405-10) simply points to where liability recognition guidance actually resides (Topics 410, 420, 430, 440, 450, 460, 470, 480), while the substantive general rules are in 405-20 (a debtor derecognizes a liability if and only if it is extinguished — payment with relief of the obligation or legal release as primary obligor, plus breakage rules for prepaid stored-value products), 405-30 (accrual of insurance-related assessments when probable, an obligating event has occurred, and the amount is reasonably estimable), 405-40 (joint and several obligations fixed in total amount, measured at the entity's agreed share plus amounts expected to be paid for co-obligors), and 405-50 (disclosure-only rules for buyers in supplier finance programs). The remaining Subtopics are industry-specific overlays — agriculture cooperatives, broadcasters, casinos, films, music, contractors, brokers-dealers, insurers, investment companies, regulated entities, not-for-profits, health care, and depository institutions — each layering a narrow recognition, measurement, or presentation rule onto the general framework. The unifying idea is that a liability stays on the books until an obligating event ends it: derecognition requires actual extinguishment, not merely economic defeasance or an intent not to pay.","concepts":["extinguishment of liabilities","legal release as primary obligor","breakage for prepaid stored-value products","joint and several liability arrangements","insurance-related assessments and obligating events","supplier finance program disclosures","regulatory liabilities","industry-specific liability accruals"],"categories":["Derecognition","Recognition","Disclosure","Industry-specific"],"level":"intermediate","provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:738f0bfb0dff9bab3485f2c7e030c31d50a4a68b2f4193cd008deb1b9dd5eded","downloaded_from":"2026-09-10T00:13:36.711Z","last_downloaded_at":"2026-09-10T00:20:28.784Z","date_scope":"source_page_range","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps"}}