# ASC 450-10-15: Contingencies — Overall — 15 Scope and Scope Exceptions

Source: FASB Accounting Standards Codification, Basic View

[Read online](https://asc.understandingaccounting.org/asc/450/10/#15-scope-and-scope-exceptions)

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## ASC 450-10-15: 15 Scope and Scope Exceptions

[Read section](https://asc.understandingaccounting.org/asc/450/10/#15-scope-and-scope-exceptions)

SEC content: no

#### Overall Guidance

##### [450-10-15-1](https://asc.understandingaccounting.org/asc/450/10/#450-10-15-1)

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The Scope Section of the Overall Subtopic establishes the pervasive scope for all Subtopics of the Contingencies Topic. Unless explicitly addressed within specific Subtopics, the following scope guidance applies to all Subtopics of the Contingencies Topic.

#### Entities

##### [450-10-15-2](https://asc.understandingaccounting.org/asc/450/10/#450-10-15-2)

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The guidance in the Contingencies Topic applies to all entities.

#### Transactions

##### [450-10-15-2A](https://asc.understandingaccounting.org/asc/450/10/#450-10-15-2A)

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The guidance in the Contingencies Topic does not apply to the recognition and initial measurement of assets or liabilities arising from contingencies that are measured at fair value or assets arising from contingencies measured at an amount other than fair value on the [acquisition date](https://asc.understandingaccounting.org/glossary/a/#acquisition-date "The date on which the acquirer obtains control of the acquiree.") in a business combination under the requirements of Subtopic 805-20, on the acquisition date in an [acquisition by a not-for-profit entity](https://asc.understandingaccounting.org/glossary/a/#acquisition-by-a-not-for-profit-entity "A transaction or other event in which a not-for-profit acquirer obtains control of one or more nonprofit activities or businesses and initially recognizes their assets and liabilities in the acquirer's financial statements. When applicable guidance in Topic 805 is applied by a not-for-profit entity, the term business combination has the same meaning as this term has for a for-profit entity. Likewise, a reference to business combinations in guidance that links to Topic 805 has the same meaning as a reference to acquisitions by not-for-profit entities.") under the requirements of Subtopic 958-805, or on the [formation date](https://asc.understandingaccounting.org/glossary/f/#formation-date "The formation date of a joint venture is the date on which an entity initially meets the definition of a joint venture, which is not necessarily the legal entity formation date. The formation date is the measurement date for the formation transaction. If multiple arrangements are accounted for as a single transaction that establishes the formation of a joint venture, the formation date is the measurement date for all arrangements that form part of the single formation transaction.") in a [joint venture](https://asc.understandingaccounting.org/glossary/j/#joint-venture "An entity owned and operated by a small group of businesses (the joint venturers) as a separate and specific business or project for the mutual benefit of the members of the group. A government may also be a member of the group. The purpose of a joint venture frequently is to share risks and rewards in developing a new market, product, or technology; to combine complementary technological knowledge; or to pool resources in developing production or other facilities. A joint venture also usually provides an arrangement under which each joint venturer may participate, directly or indirectly, in the overall management of the joint venture. Joint venturers thus have an interest or relationship other than as passive investors. An entity that is a subsidiary of one of the joint venturers is not a joint venture. The ownership of a joint venture seldom changes, and its equity interests usually are not traded publicly. A minority public ownership, however, does not preclude an entity from being a joint venture. As distinguished from a corporate joint venture, a joint venture is not limited to corporate entities.") formation under the requirements of Subtopic 805-60. Those Subtopics provide the recognition and initial measurement requirements for assets and liabilities arising from contingencies measured at fair value and for assets arising from contingencies measured at an amount other than fair value as part of a business combination, an acquisition by a not-for-profit entity, or a joint venture formation.

#### Other Considerations

##### [450-10-15-3](https://asc.understandingaccounting.org/asc/450/10/#450-10-15-3)

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In some cases, there may be uncertainty about whether a situation is a [contingency](https://asc.understandingaccounting.org/glossary/c/#contingency "An existing condition, situation, or set of circumstances involving uncertainty as to possible gain (gain contingency) or loss (loss contingency) to an entity that will ultimately be resolved when one or more future events occur or fail to occur."). Section 450-10-55 includes several situations that are not contingencies, and thus are outside the scope of the Contingencies Topic.