ASC

ASC 505-50

Equity-Based Payments to Non-Employees

505 Equity

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In brief

IntermediateStock compensationDebt and equityTransition and effective datesRevenue

ASC 505-50 formerly governed the accounting for equity instruments (shares, options, warrants) issued to non-employees in exchange for goods or services, including measurement date, performance commitment, and counterparty-performance concepts. Every paragraph in the subtopic has been superseded — chiefly by ASU 2018-07 (Improvements to Nonemployee Share-Based Payment Accounting), with the share-based-payment-as-consideration-payable-to-a-customer paragraphs superseded earlier by ASU 2014-09 (Revenue from Contracts with Customers). As a result, the subtopic contains no operative guidance; nonemployee share-based payment awards are now accounted for under ASC 718.

Key points (5)
  • Every paragraph of 505-50 (Sections 05, 10, 15, 25, 30, 35, 45, 50, and 55) has been superseded and carries no operative U.S. GAAP requirements.
  • ASU 2018-07 superseded the bulk of the subtopic and moved nonemployee share-based payment awards issued for goods or services into ASC 718, aligning their measurement with employee awards.
  • Paragraphs addressing share-based consideration payable to a customer (for example, 505-50-25-5, 30-8, 30-18, 30-19, 30-29, 35-13 through 35-16, 50-2, and 55-25 through 55-27) were superseded by ASU 2014-09 and are now covered by the revenue guidance in ASC 606.
  • Under the superseded model, nonemployee awards were generally remeasured until a measurement date (performance completion or a performance commitment); that variable, mark-to-market approach no longer applies after ASU 2018-07.
  • Because the guidance is fully superseded, references to 505-50 in older contracts, filings, or textbooks should be redirected to ASC 718 (and ASC 606 for customer consideration), subject to the transition provisions of ASU 2018-07.

For students. The only thing to know here is that 505-50 is an empty shell: ASU 2018-07 folded nonemployee share-based payments into ASC 718 and ASU 2014-09 moved share-based consideration payable to a customer into ASC 606. The common error is applying the old measurement-date/remeasurement model from legacy materials instead of ASC 718's grant-date fair value approach.

nonemployee share-based paymentequity instruments issued for goods or servicesmeasurement dateperformance commitmentsuperseded guidanceconsideration payable to a customergrant-date fair value

Machine-generated study aid for ASC 505-50. Check the source paragraphs below.

505-50-00Status

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505-50-00-1
The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
ContractSupersededAccounting Standards Update No. 2018-0706/20/2018
ContractAddedAccounting Standards Update No. 2014-0905/28/2014
Counterparty Performance ConditionsSupersededAccounting Standards Update No. 2018-0706/20/2018
Customer (1st def.)SupersededAccounting Standards Update No. 2018-0706/20/2018
CustomerAddedAccounting Standards Update No. 2014-0905/28/2014
Employee (2nd def.)SupersededAccounting Standards Update No. 2018-0706/20/2018
Fair Value (1st def.)SupersededAccounting Standards Update No. 2018-0706/20/2018
Issued, Issuance, or Issuing of an Equity InstrumentSupersededAccounting Standards Update No. 2018-0706/20/2018
Issued, Issuance, or Issuing of an Equity InstrumentAddedAccounting Standards Update No. 2016-1912/14/2016
Market ConditionSupersededAccounting Standards Update No. 2018-0706/20/2018
Market ConditionAddedAccounting Standards Update No. 2014-0603/14/2014
Market ConditionsSupersededAccounting Standards Update No. 2014-0603/14/2014
Reload Feature and Reload OptionSupersededAccounting Standards Update No. 2018-0706/20/2018
Share-Based Payment TransactionsSupersededAccounting Standards Update No. 2018-0706/20/2018
Terms of a Share-Based Payment AwardSupersededAccounting Standards Update No. 2018-0706/20/2018
505-50-05-1 through 05-9
SupersededAccounting Standards Update No. 2018-0706/20/2018
505-50-05-1AmendedAccounting Standards Update No. 2016-1912/14/2016
505-50-05-2AmendedAccounting Standards Update No. 2014-0905/28/2014
505-50-05-2AAddedAccounting Standards Update No. 2014-0905/28/2014
505-50-05-3AmendedAccounting Standards Update No. 2014-0905/28/2014
505-50-05-4AmendedAccounting Standards Update No. 2014-0603/14/2014
505-50-05-5AmendedAccounting Standards Update No. 2014-0905/28/2014
505-50-10-1SupersededAccounting Standards Update No. 2018-0706/20/2018
505-50-15-1 through 15-3
SupersededAccounting Standards Update No. 2018-0706/20/2018
505-50-15-1AmendedAccounting Standards Update No. 2016-1912/14/2016
505-50-15-2AmendedAccounting Standards Update No. 2016-1912/14/2016
505-50-25-1 through 25-4
SupersededAccounting Standards Update No. 2018-0706/20/2018
505-50-25-6 through 25-10
SupersededAccounting Standards Update No. 2018-0706/20/2018
505-50-25-2AmendedAccounting Standards Update No. 2016-1912/14/2016
505-50-25-5SupersededAccounting Standards Update No. 2014-0905/28/2014
505-50-30-1 through 30-7
SupersededAccounting Standards Update No. 2018-0706/20/2018
505-50-30-1AmendedAccounting Standards Update No. 2014-0905/28/2014
505-50-30-2AmendedAccounting Standards Update No. 2016-1912/14/2016
505-50-30-3AmendedAccounting Standards Update No. 2014-0603/14/2014
505-50-30-8SupersededAccounting Standards Update No. 2014-0905/28/2014
505-50-30-9 through 30-17
SupersededAccounting Standards Update No. 2018-0706/20/2018
505-50-30-9AmendedAccounting Standards Update No. 2014-0905/28/2014
505-50-30-10AmendedAccounting Standards Update No. 2014-0905/28/2014
505-50-30-18SupersededAccounting Standards Update No. 2014-0905/28/2014
505-50-30-19SupersededAccounting Standards Update No. 2014-0905/28/2014
505-50-30-20 through 30-28
SupersededAccounting Standards Update No. 2018-0706/20/2018
505-50-30-22AmendedAccounting Standards Update No. 2014-0603/14/2014
505-50-30-29SupersededAccounting Standards Update No. 2014-0905/28/2014
505-50-30-30SupersededAccounting Standards Update No. 2018-0706/20/2018
505-50-30-31SupersededAccounting Standards Update No. 2018-0706/20/2018
505-50-35-1 through 35-12
SupersededAccounting Standards Update No. 2018-0706/20/2018
505-50-35-1AmendedAccounting Standards Update No. 2016-1912/14/2016
505-50-35-1AmendedAccounting Standards Update No. 2014-0905/28/2014
505-50-35-3AmendedAccounting Standards Update No. 2014-0905/28/2014
505-50-35-4AmendedAccounting Standards Update No. 2014-0603/14/2014
505-50-35-13 through 35-16
SupersededAccounting Standards Update No. 2014-0905/28/2014
505-50-35-15AmendedAccounting Standards Update No. 2012-0410/01/2012
505-50-45-1SupersededAccounting Standards Update No. 2018-0706/20/2018
505-50-45-1AmendedAccounting Standards Update No. 2016-1912/14/2016
505-50-50-1SupersededAccounting Standards Update No. 2018-0706/20/2018
505-50-50-2SupersededAccounting Standards Update No. 2014-0905/28/2014
505-50-55-1 through 55-24
SupersededAccounting Standards Update No. 2018-0706/20/2018
505-50-55-2AmendedAccounting Standards Update No. 2016-1912/14/2016
505-50-55-11AmendedAccounting Standards Update No. 2014-0603/14/2014
505-50-55-17AmendedAccounting Standards Update No. 2014-0905/28/2014
505-50-55-18AmendedAccounting Standards Update No. 2014-0905/28/2014
505-50-55-25 through 55-27
SupersededAccounting Standards Update No. 2014-0905/28/2014
505-50-55-28 through 55-40
SupersededAccounting Standards Update No. 2018-0706/20/2018

505-50-05Overview and Background

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505-50-10Objectives

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505-50-15Scope and Scope Exceptions

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505-50-20Glossary

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505-50-25Recognition

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505-50-30Initial Measurement

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505-50-35Subsequent Measurement

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505-50-45Other Presentation Matters

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505-50-50Disclosure

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505-50-55Implementation Guidance and Illustrations

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505-50-S00StatusSEC

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505-50-S25RecognitionSEC

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505-50-S99SEC MaterialsSEC

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